McKinsey: Not much has changed three years after media rebate uproar
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Three years after former Mediacom CEO Jon Mandel gave a blistering speech alleging widespread media rebates in the U.S. — and the Association of National Advertisers launched a crusade to investigate and stop them — nothing much has changed, according to a report by McKinsey & Co.
The McKinsey effort, which was scheduled to be discussed at the ANA’s Advertising Financial Management Conference on Monday, was led by Sarah Armstrong, a former Coca-Cola Co. executive who dealt with media rebates extensively during the last 15 of her 20 years there before moving to McKinsey last year.
The firm found that 500 media accounts have been reviewed by advertisers in the past three years, contracts have been widely rewritten and audits of media agencies have skyrocketed. Yet rebates and other forms of “non-transparent” incentives from media companies to agencies remain common, Armstrong says.
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