UK ad agencies call for strike against AB-InBev
Is this the Brave New World? An industry group for ad agencies in the United Kingdom is calling for a “strike” against AB-InBev over what it calls “despicable” business practices, St Louis media reported on 19 March 2015.
The London-based Marketing Agencies Association (MAA) is proposing that all agencies that currently work with the brewer stop doing so by 7 April 2015. In a statement, the MAA pointed to an AB-InBev e-auction for marketing services that “made a number of exploitive demands”.
According to MAA’s account, in AB-InBev’s pitch the brewer asked firms about their lowest rates, how many work hours they would “effectively give free to AB-InBev, out of the scope of total work,” how far beyond 120 days the agencies would be willing to wait for payment, and how much they would pay the brewer in rebates over the stipulated minimum for AB-InBev’s “Better World” sustainability programme.
MAA managing director Scott Knox said in a statement, “AB-InBev is behaving disgracefully, forcing agencies to provide them with discounts and financial sweeteners across every possible work stream, even asking them to contribute hefty rebates that finance their CSR initiative ’Better World’, for which AB-InBev promptly takes all the glory.”
“What would make this a ’Better World’ would be for clients such as AB-InBev to stop screwing agencies over payment terms and rate cards, and approach any negotiation on price in a fair and respectful way.”
Mr Knox also describes as “cheeky” AB-InBev’s inquiry into how long firms could wait for payment, given that the UK government is currently working to issue a 30-day standard for payment practices.
Responding to the MAA’s call for a strike against the brewer, a UK spokeswoman for AB-InBev said in a statement: “Our decisions as to appointments of marketing agency partners are based on a variety of factors, including the outcome of the creative pitch, account management and commercial terms, and all participating agencies are made aware of this at the outset.”
“Payment terms are always set as part of a broader commercial negotiation and are established in mutual agreement,” she continued. “As part of the process, we ask all potential partners to provide details on many dimensions of their service offer so we can evaluate in a fair and objective manner the proposals we receive from each.”
