Do Clients Care About Agency Swag?

“It’s the way this business has always been, and I’ve never heard a peer of mine complain about the way things are done,” said one head of digital at a Fortune 500 company. “The folks that have been in the industry for a while just understand that this is just how this industry works. If you’re part of a sales organization, your job is to get an audience with a decision maker and to break through the clutter,” he added.

Entertainment budgets have been helping to sell media for years, of course, courtesy of ball games, steak dinners and strip clubs. But some worry the recent trend of trading gifts for media buyers’ time is taking things too far and threatens to undermine the ability of buyers to select vendors objectively based on the strength of their offering and not on what might be in it for them personally.

“We’ve always known this was going on; it’s certainly not new. But it’s always seemed somehow softer than what I’ve seen recently, said another digital marketer for a major consumer-focused brand, who held dramatically stronger views about the practice.

“Some of the worst examples seem like out-and-out bribery, and the agency leaders who are letting this go on in their cultures should be fired. It’s a real, legitimate and probably systemic conflict of interests. Clients pay these teams millions of dollars to make hard choices about where our brand dollars go, and knowing there’s a decent chance we’re getting Publisher X or Ad Network Z on our plans because that planner got a cool new pair of jeans or got loaded by the pool of a summer house leads to questions about whether we’re getting the quality we paid for.”

But agencies insist that their buyers remain objective in their decisions, regardless of the incentives vendors throw at them. To that end, they have strict policies in place governing what they can and can’t accept, they say. Yet many are reluctant to give details of exactly what these policies are, and it’s near impossible to tell if they’re being enforced. According to one junior buyer, senior agency staffers accept gifts and entertainment worth far more than the ones they’re offered, so it would seem somewhat hypocritical for them to penalize others.

Some suggest agencies have no real incentive to stamp out this gift culture because it works in their interests. Agencies know they can pay junior staffers less with the promise of free meals at top restaurants and box-seat tickets to Yankees games. The sell-side is effectively subsidizing media buyers’ salaries with these perks, the argument goes, which helps expand their ever-pressurized margins. “I don’t think a lot of clients know what’s going on. They don’t know the extent of it,” said one senior agency executive.

Other clients, however, seem pretty clued in and even get in on the action. Multiple agency buyers said they’ve been asked by clients to get them tickets for sporting events, concerts, or the theater. Often they specifically ask for the sales rep not to attend, so they’re essentially bagging hundreds of dollars worth of free tickets with no intention of talking shop. “It’s embarrassing for us to have to call vendors to ask for this stuff,” one agency buyer reported.

Ultimately, it appears client views on the gift culture issue differ greatly and vary to some extent based on the type of business they’re in and the background of the staffers heading up their marketing efforts. Though many are content to continue to turn a blind eye to the practice, others hold much stronger views.

One thing’s for sure, though: As long as agency staffers continue to accept gifts, vendors will keep giving them.

We’d love to hear your views on this issue. If you work on the client-side, please email your thoughts and experiences to me at the address below. You will be kept anonymous if we use your submission.