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We have a very diverse selection of moods and styles from around the world for you this week. First up, the new spot from Saatchi New York for General Mills' Fruit By The Foot candy in which two nerdy kids face off against one another. Well at least it's better for you than playing Dungeons & Dragons.

Also from Saatchi's, this time their Argentinean unit Del Campo Nazca Saatchi & Saatchi, the best of a set of new ads for Cadbury's, which explore different permutations on the theme of "A man will never be as good as a whole bar of Cadbury's Dairy Milk". Tragically, that might actually be true...

The Ahh! factor adds considerable appeal to this documentary-style ad by Ogilvy South Africa for the new Volkswagen Golf.

And finally, an intriguing and hypnotic spot from Brazilian agency Filadelfia for the Inhotim Museum of Contemporary Art. It's named Stendhal Syndrome, after the effect described by the 19th century writer Stendhal, who claimed to have fainted as a result of the beauty of the art he encountered on a trip to Florence. Slow motion, crowd scenes and modern art. You can't get much better than that in an ad.

In the news this past week: Advertisers

Ford reinforced its current reputation as Detroit's strongest auto manufacturer with a 2Q profit of $2.3bn. That surplus was mainly the result of one-off gains (without which the company would have reported a $424m loss) but it was nevertheless considerably better than most analysts were predicting. It was also Ford's first quarterly profit after four consecutive losses. A key metric watched by analysts was the rate of cash burned during the quarter. During 2Q Ford spent around $1bn in cash, well below the $3.7bn used in 1Q. This was seen as a clear sign that the company has found a way of stabilising its operations at the much lower sales volumes currently experienced by all the automobile majors. Most other auto manufacturers reported dismal results. Among the worst: Daimler notched up a E1bn loss for the quarter, although that figure was less than had been feared. France's PSA Peugeot Citroen had almost the same deficit for the first-half.

General Motors veteran Bob Lutz kicked off his new role as head of the auto giant's sales and marketing with a thorough review of recent advertising produced by the company's incumbent agencies. According to a report in AdAge, Lutz "spent 10 to 20 minutes critiquing the work for each brand and, in the words of someone in the know, 'crapped all over the advertising'." In an earlier public webcast, Lutz announced "I think you will very quickly see a drastic change in the tone and content of our advertising. And if you don't, it will mean that I have failed." The most likely outcome will be marked shift away from mood or lifestyle-oriented campaigns towards more straightforward "nuts and bolts" advertising which highlights cars' design and features. However marketing guru Al Ries, also writing in Ad Age, was scathing regarding the 77-year-old Lutz's credentials in this area. Until April this year, Lutz headed global product development for GM. "Has respect for marketing fallen so low," asked Ries, "that the most difficult job in the profession (getting GM out of the ditch) can be given to someone with so little experience in marketing?" He warned GM not to make the mistake of making ad agencies the fall guys for a fault that lies squarely with the company's own marketing strategy.

Sprint Nextel said it would take full control of Virgin Mobile USA, the prepaid MVNO operator to which it currently supplies call volumes. The deal values Virgin Mobile at $483m. Sprint already has a 13% holding in the business, and will acquire the shares owned by partners Virgin Group and SK Telecom of Korea. It launched an offer for the remaining shares which are publicly held. Virgin Mobile will be merged with Sprint's existing Boost service, although both brands will continue to co-exist in the short term.

In a serious new blow to Formula 1 motor racing, another key sponsor has withdrawn its support from the sport after more than ten years' involvement. BMW said its decision to pull out of F1 was prompted mainly by its strategic repositioning as an environmentally sustainable manufacturer. (F1's fuel-burning supercars are notoriously "ungreen"). However the company also acknowledged that the poor performance of the BMW Sauber team in the latest F1 season - it currently ranks 8th- had contributed to its decision. Malaysian energy company Petrobras will remain the headline sponsor of the Sauber team.

Pernod Ricard sold its Tia Maria drinks brand to Ilva Saronno of Italy for E125m. Tia Maria is the world's #2 coffee liqueur behind Kahlua, also owned by Pernod. 

Vodafone named Wendy Becker, previously MD of UK telecoms company Talk Talk, as its new group chief marketing officer. She replaces Frank Rovekamp.

In the news this past week: Agencies

The major marketing groups have been reporting quarterly results, and all have seen sharp falls in profitability. Arguably the poorest results to-date were from Interpublic, which reported a net loss of $39.2m for the first six months of the year, compared to a net loss of $32.3m for the same period last year. Revenues were $2.8bn, down 16%. The most worrying metric was the decline in organic revenues, which exclude the effects of currency fluctuation and acquisitions. The figure for 2Q slumped 14.5%. Deutsche Bank analyst Matt Chesler called the figures "shockingly disappointing" in a research note and added "we are not surprised that questions about IPG's competitiveness are resurfacing".

Omnicom saw net income decline 23% for the first six months of the year to $398m on revenues down 16% to $5.6bn. Like Interpublic, Omnicom experienced the hardest trading outside the US, with international revenues falling by roughly twice as much as domestic sales in percentage terms. Publicis Groupe demonstrated more resilience, with half year revenues falling less than 1% to E2.2bn. Net income declined 13% to E167m. Organic revenues fell 10% for Omnicom in 2Q and by 8.6% for Publicis. All three groups are exposed to the hard-hit auto sector: Omnicom works for Chrysler; Interpublic and Publicis for GM. WPP and Havas have yet to report. WPP's figures are expected late August.

Former TBWA exec Robert LePlae was named as president, McCann North America, with overall responsibility for most of that agency's outposts in the US and Canada, except flagship McCann New York. LePlae's first task will be to strengthen McCann's weakening hold on the key Microsoft account, steadily leaching across to JWT. 

There were management changes at two Omnicom agencies in Germany this week. Frank Lotze, a Jung von Matt executive, was named as the new CEO-elect of BBDO Germany. He will take over that role at the end of the year from Anton Hildmann, who will remain chairman. At TBWA, Hubertus von Lobenstein resigned as CEO and was replaced by Sven Becker.

In account assignments, US fast-feeder Wendy's appointed Kaplan Thaler as its new agency, replacing Kirshenbaum Bond. AB InBev called a global review of the Beck's account after it was resigned by Lowe London, and also put the UK Budweiser account up for grabs, out of Fallon London. According to Brand Republic, Kraft has kicked off a rolling global review of media. The first countries affected will be smaller European markets. In the US, drugstore Walgreens appointed Arc Worldwide to handle promotional marketing. For all other appointments, subscribers can access the full Adbrands Account Assignments database here. 

In the news this past week: Media

Bing! After months of on-again off-again negotiations, Microsoft and Yahoo finally agreed terms for a ten-year strategic alliance in the search advertising market, designed to narrow the gap with Google. Under the proposed deal, Yahoo will pull the plug on its own search service and will instead use Microsoft's newly launched Bing service to deliver results across its network, under the branding of Yahoo "powered by Bing". It will also take over responsibility for all search advertising sales for both companies, mainly using Microsoft's technology. The two businesses will split revenues, with Microsoft paying Yahoo 88% of the search revenue generated from the arrangement during the first five years of the agreement. If cleared by regulators, the partnership should launch in early 2010. Based on June 09 figures, the Microsoft-Yahoo partnership would give Bing an effective 30% share of US search, compared to Google's 65%. Yahoo CEO Carol Bartz said that the deal would let Yahoo focus on its strengths in content development and ad sales, without the distractions of technology development. Analysts were disappointed by the news, especially the lack of any upfront payment by Microsoft, and marked down Yahoo's shares by as much as 12% in initial trading. However advertising figures including Sir Martin Sorrell voiced their support of the partnership. "It is very welcome for our clients," said Sorrell, "as it brings more balance to the search marketplace and may moderate pricing."

Ben Silverman, the high-profile chairman of NBC's entertainment unit, has left the media group to establish a new production joint venture with Barry Diller's IAC. Silverman's two-year stint at NBC has been controversial. Considered something of a golden boy of the industry by 2007 because of hit shows Ugly Betty, The Office and Biggest Loser, which he launched in the US as an independent producer, he was hired to kick-start NBC Entertainment, then struggling to find replacements for long-running hit shows Friends and Frasier. It was not an especially popular appointment within the industry. The abrupt ousting of Silverman's predecessor provoked a degree of resentment among many insiders, as did the new boy's regular presence in the social columns and the dream deal he pulled off to sell his pre-NBC production company Reveille for $200m. Most importantly, however, the new shows he introduced at NBC, which included a dismal reinvention of Knight Rider, failed to capture an audience, leaving the "Peacock network" still stuck in bottom place among the big four broadcasters. Silverman's new production JV with IAC is described as "Reveille meets BBDO", with the aim of creating sponsor-branded entertainment programming. His programming duties at NBC Entertainment have been absorbed by head of NBC Universal cable TV Jeff Gaspin. Marc Graboff, previously co-chairman with responsibility for the business side of the division, becomes sole chairman of NBC Entertainment.

The UK will soon see the launch of a new competitor in the video-on-demand sector. Arqiva, which owns all of the country's TV transmission towers and around a fifth of mobile aerials, has acquired the technology behind "Project Kangaroo", the commercial VOD service jointly conceived by the BBC, ITV and Channel 4, but recently blocked by regulators on monopoly grounds. Arqiva plans to launch its own service before the end of the year, funded by subscriptions and advertising.

As always, if you haven't already done so, please confirm your subscription to the free Adbrands Weekly Update by clicking here or on the link at the foot of this email. Thank you for your assistance! 

Simon Tesler
Publisher, Adbrands

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