Consultants routinely have many clients in the same industry, because they have expertise in that vertical. Ditto for lawyers, accountants, researchers and even models. But when it comes to advertising agencies, the whole issue of conflict crops up. Why is that?
On the one hand, clients want domain knowledge and experience. On the other they don't want you to work for the competition. Why is that? Confidentiality reasons did you say? Are you telling me that advertising agencies know more about their clients' business than management consultants, lawyers, auditors and tax specialists? Or are we saying that clients don't trust advertising agencies to keep their mouths shut?
The focus on confidentiality is all wrong. Insiders in each industry routinely know everything important that there is to know about others in their industry, long before the client gets around to briefing their advertising partners. If there is something they don't know, all they need to do is to invite an employee from their competition for an interview and then give him or her a gentle grilling. You don't even need to hire the person.
Although people are changing jobs all the time anyway. Both at client end and the agency end. So how do you keep things confidential from your own people?
So perhaps it is not confidentiality. Perhaps clients want their agencies exclusive because they want the best ideas for themselves and not have to share them with others in their industry. There may be something in this. However, even this thesis breaks down when you consider that clients are today shopping around for ideas from so many different places. From their celebrity models, their event agencies, their PR firms and so on. Most of them are not bound to exclusive contracts like ad agencies are.
In fact there is a lot to learn from model contracts. There are two kinds of model contracts. One which prevents the model from appearing in any competing ads, and the other which does not. The first is a lot more expensive than the second, for the same amount of time.
Perhaps ad agencies need to codify such an arrangement with its clients. If you want exclusivity, it will cost more. Then we will know how many clients seriously worry about their agencies leaking information.