"We will always do what we believe is in the best interest of you, our clients. Rest assured: Kickbacks, rebates and lack of transparency have never been, and will never, be a concern during your partnership with Empower.” - Jim Price, president and CEO
A letter to clients from Jim Price, president and CEO, Empower MediaMarketing
If you recall in March 2016, Ad Age published an article about former Mediacom CEO Jon Mandel’s “blistering” remarks about media agency rebates and kickbacks. Mandel claimed media agencies don’t live up to their fiduciary duties to clients and “cross the line of acceptable conduct in a partnership.” He goes on to state, “they are not transparent about their actions. They recommend or implement media that is off strategy or off target if it works for their financial gain.”
At that time, Empower renounced those activities by stating, “The costs that you receive from us are not marked up and are always fully transparent. In our 30 years of business, we have never received a kickback. Volume rebates, while few and far between, are prorated back to you.”
Since that period in time two significant activities have occurred:
1. The 4A’s (American Association of Advertising Agencies) of which we are a current member published the “transparency guiding principles of conduct” in January 2016.
In principle, while we agree with the 4A’s transparency statement and we are in compliance, we have been disappointed in the 4A’s prioritizing holding companies in developing these principles and their inability to work with the ANA. In addition, we’re disappointed the names of people and the agencies who have violated clients’ trust were not released at this time. It’s an unfair blanket allegation on those who have always done what’s in the best interest of their clients, like Empower.
Therefore, today, Empower has decided to suspend our membership with the 4A’s until they further identify who is in violation and how they plan to take action. It’s not in the best interest of our clients and Empower to be associated with agencies who have clearly dishonored clients’ trust.
We will evaluate our options once the 4A’s has responded and the violators have been identified.
In the interim, we want to say again (like we have in all 31 years), we welcome audits at any time. We will always do what we believe is in the best interest of you, our clients. Rest assured: Kickbacks, rebates and lack of transparency have never been, and will never, be a concern during your partnership with Empower.
Thanks for reading and — most importantly — placing your trust in us.
Jim Price, president and CEO, Empower MediaMarketing