Dive Brief:
- Anheuser-Busch InBev, or AB InBev, has initiated a global agency review with the goal of consolidating business down to one or two agencies, according to Ad Age, although the final number of agencies hasn’t been determined. Currently the brewing company uses eight agencies to handle its ad business in more than 50 countries.
- An AB InBev spokesperson told Ad Age all of its current agency holding companies have been invited to participate in the view with Media Link serving as search consultant and Media Path as auditor.
- WPP’s MediaCom has held the U.S. AB InBev account since late 2014.
Dive Insight:
Considering the review announcement comes months after the brewer acquired SABMiller for $103 billion, it is not complete surprise as major brands tend to look for areas of consolidation and media efficiencies after large acquisitions.
However, the review is the first time AB InBev has considered consolidating a significant component of its marketing capability, a company spokesperson told Ad Age. This suggests the brewer, like many other major brands, is looking for ways to drive greater efficiency in its marketing efforts and is focusing on agency relationships as one area where there is inefficiency. For example, AB InBev, the 20th largest U.S. advertiser at $1.68 billion in 2015 per Ad Age Datacenter, is looking to create consistency in media rates.
Inconsistent, possibly inflated, agency fees is a growing concern for brands in the wake of allegations from several sources last yera that fees are being mishandled. The Department of Justice is investigating several agencies over allegations of mishandling production contracts while the ANA published a report claiming non-transparent billing practices by agencies.
AB InBev's announcement coud have agencies flashing back to 2015 when a record number of agency relationships dollar-wise were put under review and the entire industry scrambled and essentially played musical chairs as new deals were formed with big brands.