‘100 clients’ caught in Dentsu billing scandal in Japan as cloud cast over 2020 Olympics role

Toyota and Dentsu logosThe transparency scandal to emerge from Japan today involves 100 of Dentsu’s clients and 160 incidences of irregularities in digital media pricing over a three year period, according to sources close to the matter.

An audit was initially carried out to investigate digital media over-billing for Dentsu’s flagship client Toyota, and was later applied across the Japanese agency giant’s huge client portfolio to check for further misdealing.

Toyota’s headquarters in Japan confirmed with Mumbrella afternoon that the car maker had been notified by Dentsu of the “irregularities”, but declined to go into any more detail.

The company commented: “At Toyota, we value our relationships with our agencies and other partners. While we are not in a position to provide additional details, we have been notified by Dentsu of irregularities in some digital media business transactions.”

Dentsu has declined to give any more information on the nature of the irregularities, describing them as “inappropriate operations” in digital media trading. The agency has also issued a formal apology to Toyota, according to sources.

The incidences relate to Dentsu’s performance marketing arm DASL, but industry observers predict that the audit’s findings will lead to greater scrutiny of Dentsu’s traditional media trading operations.

Dentsu is by far the largest player in Japan, and enjoys unrivalled supremacy as both a buyer and seller of media in one of the world’s least transparent media markets, which could now face increased scrutiny.

The news will cast a cloud over Dentsu’s status as the marketing agency for the 2020 Olympics in Japan. It came as no surprise when Dentsu was appointed by the Tokyo Organising Committee in 2014, and the agency was set a target of 150 billion yen (US$1.5 billion) to be raised from sponsorship sales and other commercial activities.

The news will also be of interest to marketers operating in other relatively opaque media markets such as Korea, India and Indonesia at a time when the impact of a report into client-media agency transparency in the US, released four months ago, is beginning to be felt globally.


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