Adbrands Weekly Update 15th May 2008
A weekly round up of key news about 
leading  advertisers, agencies and mediaowners
 
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First, our favourite ads this week: 

Dove Chocolates "Pam Nesia"
by Cummins Nitro

Schweppes "Gamme" 
by FFL

Britvic Drench "Brains" 
by CHI & Partners

Subaru  "Carwash" 
by Carmichael Lynch

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Australian agency Cummins Nitro is responsible for a witty and entertaining campaign for Mars' Dove chocolates. Under the banner of Dove Chocumentaries, these purport to tell the stories of unusual people who deal with life's little challenges by scoffing a choc. Our favourite from the first two is Pam Nesia, but see also the accompanying ad Em Ocean. I guess a bottle of Schweppes tonic must have the same effect on the French, if this luscious and luminous new ad by FFL is anything to go by. Maintaining the theme of liquid refreshment, CHI & Partners (who don't often get a look-in at Ads of the Week) have selected Brains from Thunderbirds as the spokesmodel for Britvic's bottled water brand Drench. I always knew there was more to Brains than brains... And finally, how about this ad for Subaru from Carmichael Lynch in which a group of playful topless Japanese get wet and soapy in the carwash? Oh, did I mention that they're all sumo wrestlers...? 


In the news this past week: Advertisers

Unilever's Dove personal care brand was at the centre of a PR imbroglio after photographic retoucher Pascal Dangin appeared to suggest, in an interview in the New Yorker, that he was involved in manipulating some of the campaign's 'real beauty' images. "Do you know how much retouching was on that?" he was reported to have said. "But it was great to do, a challenge, to keep everyone's skin and faces showing the mileage but not looking unattractive." The Dove campaign famously features "real" women, with all their weight, skin and complexion issues intact, while also casting barbs at retouched "unreal" images. A revelation that the Dove models had themselves been retouched would not reflect well on the brand, and as a result the New Yorker quotes were widely reported elsewhere by a scandal-hungry media. However, all the parties involved in the production of the images were quick to deny that any such changes had been made. Dangin himself issued a follow-up statement saying, "My quotes have been taken out of context and my role with Dove misconstrued". He worked only on the 2007 Dove Pro-Age campaign, photographed by Annie Leibovitz, and said that "I was directed only to remove dust and do colour correction - both the integrity of the photographs and the women's natural beauty were maintained." Unilever confirmed that "the women's bodies were not digitally altered" in the original 2005 real women ads and that the only actions taken in the Dove Pro-Age campaign "were the removal of dust from the film and minor colour correction."

Delivering better-than-expected 1Q results for 2008, Unilever said it was "considering strategic options" for its Bertolli olive oil business, the usual code for a potential sale. It is understood that any such disposal would only be of the oil brands - Unilever would keep hold of rights to use the Bertolli name on other products. It has introduced a number of Italian foods under the Bertolli banner in recent years, including spreads, sauces and even ready-made meals. Unilever also recently announced plans to transfer 14 of its regional food brands out of their local divisions and into a separate operating unit in Rotterdam, codenamed Project Chrysalis. This move is not necessarily the overture to a sale, says the company. Instead, the strategy is designed to give more specialised attention to these "local jewels", brands with a strong following in one market but limited international appeal. The British brands involved include Marmite, Bovril, Pot Noodle and Peperami, and they will be joined by other as yet unidentified products from France, Germany and Sweden. Meanwhile, Unilever is also still negotiating with potential buyers for its North American laundry detergents business. A decision is expected by mid-year. 

There are some brands, it seems, that we Britons love to hate and hate to love. Marketing magazine this week published its 4th annual ranking of the country's most loved and most hated brands, based on consumer research compiled by Joshua G2. Typically, no less than four brands top both lists for their sector. Tesco, British Airways, Manchester United and The Sun are not just the UK's most loved supermarket, airline, football club and newspaper, respectively, but also its most hated. Displaying a similar paradox, McDonald's topped the list as the single most hated brand in Britain, picked by 27% of respondents despite the fact that (presumably the other) 70% of the population confess to eating there at least once a year. McD clawed its way onto the Most Loved list as well, albeit at lowly #37. Also among the top five hatees were AOL, Nokia's N-Gage handheld gaming device and discount store TK Maxx (the UK offshoot of America's TJ Maxx). The overall best-loved brand was Nokia, named by an impressive 39.6% of respondents. In third place (after Tesco) was the Apple iPod, followed by mobile service O2 at #4. Facebook was 5th. Cable provider Virgin Media was by far the biggest climber, becoming the country's 6th favourite brand, up from #140 last year. Among celebrities, Paul McCartney was most loved; his ex-wife Heather Mills was most hated. See the full survey results here.

Printer and computer giant HP announced plans to acquire IT services group EDS for around $14bn. Assuming the deal goes through, EDS will combine with HP's existing IT outsourcing and consultancy units. Combined revenues would be around $40bn, closing the gap a little with market leader IBM, which has IT services revenues of around $54bn.

British supermarket group Tesco announced the biggest deal in its history, agreeing to acquire a collection of 36 hypermarket stores in South Korea from local retailer E-Land for just under £1bn. Most of the stores were themselves acquired by E-Land from Carrefour when the French group pulled out of Korea two years ago. The purchase will confirm Tesco as Korea's #2 food retailer although it still sits some way behind market leader E-mart. Korea is already Tesco's #2 market by revenues after the UK. Once this latest deal is completed it will have almost 100 hypermarkets and more than 70 convenience stores in the country, with combined sales of around £4bn annually.

Movie studio Warner Bros is pulling out of the arthouse circuit, having announced plans to close its two specialty distribution units, Warner Independent Pictures and Picturehouse. That decision follows the move to absorb second-string mass-market studio New Line into the main Warner Bros business earlier this year. Time Warner was one of the last of the studio majors to move onto the arthouse circuit in the wake of the huge critical and commercial successes notched up by Miramax, the independent distributor responsible for the likes of Pulp Fiction and The English Patient. Warner Independent Pictures and Picturehouse each scored some modest hits: WIP was responsible for US distribution of March of the Penguins, a surprise hit in 2005; Picturehouse recently won Oscars with Pan's Labyrinth and La Vie En Rose, but neither of those films earned much at the box office. Despite the critical plaudits these so-called thinking movies generate, they rarely make much money but are becoming increasingly expensive to make and ever more difficult to raise funding for in these belt-tightening days. 


In the news this past week: Agencies

Mainardo de Nardis, global CEO of Aegis Media, has left the company abruptly, apparently without a job to go to. He was replaced by Jerry Buhlmann, previously CEO of Aegis Media EMEA. The sudden departure of de Nardis does not appear to have been expected. Only two weeks ago Aegis had announced that, in addition to his CEO duties, de Nardis would also take over direct control of the group's Latin American division. That move was prompted by the resignation of David Verklin, previously CEO of Carat America. No explanation for de Nardis's departure was given other than that this was "an evolution". Over at WPP, former MediaCom CEO Alexander Schmidt-Vogel was named as the new global CEO of trading at GroupM, the group's central negotiation unit. Schmidt-Vogel was replaced as MediaCom chief last week by Steven Allan.

Meanwhile, WPP chief Sir Martin Sorrell made a new approach to research group Taylor Nelson Sofres, increasing his offer to £996m, 5% up on the last bid. Once again, the price was rejected by the TNS board, which is attempting to merge instead with Gfk. Sorrell's chances of breaking up the TNS-Gfk combination took a further blow with the news that Nielsen, the global #1 in market research, had abandoned plans to mount its own separate offer for Gfk.

WPP also unveiled the name of its newly created agency global Dell agency. The company formerly known as Project DaVinci is now officially Synarchy Worldwide. As yet however, WPP still hasn't found a CEO, although it has assembled the rest of the executive committee. According to Advertising Age, they are Valerie Hausladen (general manager of the main Synarchy office in Austin, Texas); Kelly McGinnis (global corporate communications lead); Matt Rayner (global media lead); Joseph Scangamor (COO & CFO); Ken Segall (global creative lead); Stephen Sonnenfeld (global consumer lead); and Jeffrey Wilks (president, business solutions group).

In account news, Pernod-Ricard's Chivas Regal transferred its global account into Euro RSCG; Michelin tires called a review of US creative and digital, out of Campbell-Ewald; graphics chip manufacturer Nvidia placed its $35m creative account with TBWA-affiliated Cutwater; baby foods maker Beech-Nut handed its entire integrated account to Palio Communications of Saratoga Springs, NY, best-known as a healthcare agency; UK broadcaster Channel 4 and retailer Debenhams both called reviews of media; For all other appointments, subscribers can access the full Adbrands Account Assignments database here.


In the news this past week: Media

UK pay-TV operators Virgin Media and BSkyB confirmed that they are in preliminary talks over the return of the latter's free-to-air channels to the Virgin cable platform. Sky pulled its Sky One and Sky News channels from Virgin in February 2007 after the two sides failed to agree over a hike in carriage fees. A bitter PR battle ensued, which cost both sides. Virgin shed a substantial number of its users to Sky, while the satellite broadcaster suffered a sharp fall in ad revenues as a result of the reduction in total viewing figures. Much has changed since then, not least the two companies' respective CEOs. At the same time, Virgin has scaled down its own ambitions in the TV market, and has now put its portfolio of owned channels, including Bravo, Living and a 50% share in UKTV up-for-sale. One scenario suggested by observers is that Sky will renew supply of its free channels to Virgin in part-exchange for the latter's cable channels.

This week the five main US broadcast networks began presenting their programme schedules for the coming Fall/Winter season to advertisers in order to secure commitments for ad buys. Last year, they did better than expected, notching up around $9.1bn in prime time sales, up 5% on the year before. However most analysts are predicting a sharp decline this year, reflecting the interruption in programme development cycles created by last winter's writers' strike, a continuing move towards online media, and the weakening economy. Analyst Jessica Reif Cohen of Merrill Lynch predicts a best-case scenario of minus 2%, to just under $8.8bn, and worst-case of minus 14%, to $7.7bn. In the best-case scenario, she expects four of the five networks to register a decline, with only Fox delivering an increase of around 2%. At worst, all five would be down by between 12% and 15%. In both predictions, she expects cable to outperform the main broadcast networks. 

Cablevision, a late entrant into the contest to acquire Long Island daily Newsday, has secured the prize with a bid of $612m for a 97% shareholding. The remaining shares will be retained by the seller, Tribune Co. Family-controlled Cablevision also own the Madison Square Garden entertainment venue and the New York Knicks basketball team, as well as various cable channels. Rival bidder Rupert Murdoch dropped out of the race last weekend.

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Simon Tesler
Publisher, Adbrands


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