In a recent letter sent to Mars Global Chief Marketing Officer Bruce McColl, the AICP lamented the corporation's announcement that it will move to a 120-day payment policy across the board. If this policy had been applied to ad agencies, it could have severely harmed the companies that create its ads. In the letter, AICP President and CEO Matt Miller wrote, "While I
believe that the type of policy described may have a profound effect on
the many businesses Mars regularly works with, if applicable to the
world of advertising and media production, it would be extremely
detrimental to all parties involved."
The letter sent by the AICP as well as one sent by the Association of Independent Creative Editors were picked up in a recent edition of Advertising Age.In a recent interview, AICE Executive Director Rachelle Madden summarized that association's thoughts saying, "It ultimately boils down to a large multi-billion dollar corporation
leaning on independent small businesses for interest-free loans and
that's just absurd."
The pressure applied by the AICP, as well as the press the story was receiving led to Mr. McColl replying to Mr. Miller's letter, with the reassurance that extended payment policies will not be applied to dollars earmarked for production. Read Mr. Miller's satisfied response to Mr. McColl here. Ad Age added a follow-up article detailing the saga.
The initial policy follows moves by other big advertisers to extend payment periods, including Procter & Gamble, which has sought to move from 30 to 75 days, and Mondelez International, which confirmed a year ago that it was seeking 120-day terms, both of which generated a call to action by the AICP.