Isn't it ironic? The IPA's stance on in-house production units puts indies at risk
A view from Steve Davies

Isn't it ironic? The IPA's stance on in-house production units puts indies at risk

The IPA slammed Accenture for venturing into programmatic media-buying services, yet it hasn't changed its stance on agency in-house production units.

I’ve had an earworm for the past few weeks. It’s Alanis Morissette’s ‘90s hit single Ironic.

I’m sure you remember some of the lyrics. They’re sort of hilarious, because by and large, they prove the singer doesn’t have a clue about irony. 

It’s been stuck in my head since the end of May, when the IPA slammed Accenture for venturing into programmatic media-buying services, loudly shouting that it was incompatible with their role as a media auditor. 

There’s a killer line from the IPA’s Paul Bainsfair: "In an era where transparency is under the spotlight, this self-evident conflict of interest is unacceptable." 

All this, when the IPA has been furiously telling the APA that it’s "unreasonable" to suggest agency in-house production companies shouldn’t pitch against independent production companies for the same work.

That’s up there with Alanis saying the epitome of irony is finding a black fly in your Chardonnay or having 10,000 spoons when all you need is a knife.

And in more Alanis-channelling, irony-ignorant japes, the IPA nicked one of the phrases we’ve been using to protest against agencies pitching against independent production companies, when it accused Accenture of "marking their own homework".

Isn’t it ironic? Certainly, when in the US, the FBI and the Department of Justice are investigating whether agencies are intentionally rigging pitches for production work to favour their in-house production arms. We need to stop the same thing happening here.

At the APA, we’ve repeatedly raised concerns about the rise of in-house production companies working for brands pitching against independent production houses. The IPA claims the system isn’t rigged and is fair and transparent. How can this be when in-house agencies are winning their clients’ budgets by making themselves out to be separate entities? Agencies have come up with in-house production department names that sound eerily similar to the independent production companies they pitch against, such as ‘Inside Job’, ‘Trailer Park’, ‘Kin’, ‘Kream’, ‘Flare’, ‘Black Sheep’.

Meanwhile, independent companies are putting in the financial and emotional commitment and getting way down the line on projects, only to be told by agencies that they’ve had to put their in-house bid in because the client has asked for it, or some such flam. More importantly, APA members don’t want to bid against in-house departments because pitching is an investment of time and money and it requires putting their creative ideas out in the open. 

Why should they go to those lengths when they are at such a disadvantage?

Independent companies cannot survive if the situation continues like this. We have asked the IPA to commit to the principle that ad agencies should not bid their own in-house department against the independent market. We suggested the sensible solution would be that they either bid for the work themselves or use the open market – but not both. That would be eminently fairer to clients and in the best interests of their brand. They would have the option of genuine free market competition involving three independent production companies fighting for their work based solely on expertise and price. 

The IPA has said its agencies will ensure they do not use any information disclosed to them by a production company to enhance their own bids. That is so counter-intuitive to the agency’s interests, it is clearly impossible to achieve in practice. 

In true Alanis style, the IPA has been complaining that Accenture is not in a position to assess bids for media buying while bidding itself for the business. Can it not see that we are going through the very same situation with ad agency in-house pitches? 

There’s an obvious attraction for agencies to keep work in-house. It bolsters their revenue and gives them closer control of the production process. They may put it down to quick turnaround times or a budget too small to engage a production company. But for the benefit of advertisers and the integrity of the industry, they should instead be reaping the rewards of true open market competition. 

The process is rigged and we don’t want to be part of it. We genuinely don’t believe it’s in the interests of agencies either, because a fair, open and transparent process is what advertisers want.

I’m calling on the IPA to do the right thing and stop defending the indefensible. The current situation isn’t sustainable, not just from a creative perspective, but for the health of the industry. How on earth can you slate Accenture while taking your current stance on in-house production?

One Alanis line is ringing in my ears right now: "It’s the good advice that you just didn’t take. Who would have thought? It figures…"

Steve Davies is the chief executive of the APA.