Starcom / MediaVest Spark

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Until recently, Starcom MediaVest (SMG) was the world's #1 media network, with global billings estimated by Recma at $43.26bn in 2014. It was originally formed in 2000 from the merger of what were then the media arms of Leo Burnett and D'Arcy, part of Publicis Groupe, and a partner to stablemate ZenithOptimedia. The Starcom and MediaVest brands were for the most part merged as a single business, although the group still operated separate units in some markets, notably the US, to resolve client conflicts. Starcom was named US Media Agency of the Year in both 2006 and 2007 by Advertising Age, and as Media Agency of the Decade by Adweek in 2009. However overall performance was rocked after 2010 by several major account losses. The first major blow was the loss of the massive General Motors account in North America in 2012. Far more dramatic was the quadruple whammy of Coca-Cola, Procter & Gamble, Mondelez and Walmart, all of whom moved their North America business out of the network during 2015 and early 2016. That prompted a complete overhaul in 2016, which involved the spin-off of MediaVest and its combination with smaller unit Spark, leaving Starcom as a separate standalone brand. Many of the old network's back office functions have at the same time been centralised in a newly created Publicis Media umbrella company.

Which clients do Starcom and MediaVest Spark handle? Find out more from Adbrands Account Assignments

Who are the competitors of Starcom and MediaVest Spark? See ranking of Leading Media Agency Brands

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Adbrands Company Profiles provide a detailed analysis of the history and current operations of leading advertisers, agencies and brands worldwide, and include a critical summary which identifies key strengths and weaknesses. Adbrands Account Assignments tracks account management for the world's leading brands and companies, including details of which advertising agency handles which accounts in which countries for major markets.

Recent stories from Adbrands Weekly Update:

Adbrands Weekly Update 2nd Mar 2017: In account assignments, no one can accuse Publicis Media of standing quietly on the sidelines. The group is working hard to rebuild its organic growth metric for the current quarter, after a horrendous Q4 2016. However, headwinds remain. Publicis agencies feature in seven of the ten biggest media moves so far this year, but it's been on the losing side in two of those transfers, making the need to win all the more urgent. This week's major positive was the capture by Starcom of DIY retailer Lowe's $300m US account (from OMD).

Adbrands Weekly Update 12th Jan 2017: There was proof once again that, in the media buying business, today's joy can quickly turn into tomorrow's misery. Publicis Media's end-of-2016 gains of Fiat Chrysler and a greater share of global Mars were all but obliterated by two beginning-of-2017 losses. American Honda reversed a decision made three years ago to move media for the Honda and Acura brands from indie RPA to what is now MediaVest Spark. That $600m account will now move back to RPA. Meanwhile Starcom will surrender media for Coca-Cola Company in China to a newly created unit of Dentsu Aegis Network, to be baptised Dentsu Coca-Cola Community.

Adbrands Weekly Update 18th Aug 2016: P&G is continuing to tweak international media requirements. It concluded a review in China, retaining Starcom as lead agency for buying but expanding the role of planning partner Mediacom to cover more brands, as well as branded entertainment, digital and selected ecommerce projects. P&G also confirmed this week that it will indeed review media in the UK, as had been rumoured for a couple of weeks. Starcom currently handles broadcast and most other media, while Mediacom has print and some planning duties.

Adbrands Weekly Update 26th May 2016: Heineken is searching for a second media agency to work alongside main current partner Starcom MediaVest. The brewer stressed that it is not looking to replace Starcom but to find a complementary offer for the 40 or so smaller markets where it does not currently use the Publicis-owned network. So why not simply appoint Starcom for those markets as well? This situation has been generated, at least in part, by the Groupe's decision to reduce the focus of networks such as Starcom, or indeed Leo Burnett or Saatchi, only on larger or more lucrative ad markets. All duties of those networks in smaller markets will be subsumed into the catch-all Publicis ONE entity. Clearly that may not appeal to all clients.

Adbrands Weekly Update 10th Mar 2016: In a shock announcement that will further unsettle staff and clients, Publicis Groupe announced a major restructuring of its global media division that will include the dismantling of the Starcom MediaVest and ZenithOptimedia networks. The current portfolio of six media brands will be reconfigured to create four networks. Starcom and Zenith will continue to operate as distinct units. However, the MediaVest brand will now be paired with smaller partner Spark as MediaVest Spark, while Optimedia will merge with its own smaller satellite Blue 449 as Optimedia Blue 449. Each network will also be slimmed down, with most back office functions centralised at umbrella entity Publicis Media. Seven new group units have been created to oversee technology, content, trading, analytics and other disciplines. "A leaner and simpler structure will bring more value to our clients and will further accelerate our growth," claimed group CEO Maurice Levy. However, WPP, in its 4Q results presentation, issued an analysis of 2015's "mediapalooza" pitch frenzy which demonstrated that Publicis was the only one of the six major networks to suffer a net loss in billings, totalling around $3bn; compared to gains and retentions of over $6bn for WPP and $2bn for Omnicom. The restructured Publicis Media entity is led by CEO Steve King, with John Sheehy as president, global clients. Lisa Donohue was named as president of the slimmed-down Starcom network; Vittorio Bonori is global brand president, Zenith; Brian Terkelsen will lead MediaVest Spark; and Andras Vigh was appointed as president of Optimedia Blue 449.


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Background

Free for all users | see full profile for current activities: The oldest unit within Starcom MediaVest Group is effectively MediaVest, originally created from the media department of ad agency Benton & Bowles (later part of DMB&B/D'Arcy). In the late 1920s, B&B was a pioneer in the use of radio for advertising, and began creating its own programs to serve as springboards for its clients. The same approach was adapted for television with the growth of that medium in the 1950s, and in 1956 B&B and core client Procter & Gamble jointly created the CBS daytime serial As The World Turns, which was sponsored by P&G's newly launched Tide detergent. That relationship led to daytime serials becoming known as soap operas, since they were regularly interrupted by commercials for Tide, and rival detergents. Three years later, B&B merged its programming and media planning departments into a single unit within the agency.

For the next 30 years, this department continued to handle programming and media purchases under the overall umbrella of Benton & Bowles, and later D'Arcy MacManus Benton & Bowles. But in 1993, the most important team within DMB&B's media department, handling big ticket national broadcast television buying, was spun out as a separate unit under the name TeleVest. This business later absorbed first the spot and cable buying functions of media department, and then responsibility for other media as well. At the end of 1997 TeleVest had captured all of P&G's TV media, making it by far the country's leading buyer, and at the close of 1998, TeleVest was hired by Coca-Cola to help formulate a global TV strategy.

This centralization of media worked so well that DMB&B began to roll it out in other markets as well, creating the MediaVest brand for the first time in 1996 with the spin-out of the media department of its German agency. In 1997 the brand was extended to the UK with the rebranding of DMB&B UK's planning and buying arm, The Media Centre, which had achieved standalone status back in in 1991. By the close of 1998, the MediaVest brand had been established in four countries - France, Germany, Mexico and the UK. The following year, TeleVest also adopted the MediaVest name after absorbing DMB&B's planning department.

Other agencies were also establishing their media departments as semi-independent units. In 1997, Leo Burnett in Chicago had also established its media department as a semi-autonomous unit under the name Starcom. Like TeleVest at DMB&B, initially it was simply the Leo Burnett in-house media department under a new name, only handling existing Burnett clients. But those clients were big hitters, including Procter & Gamble (in 45 countries), Coca-Cola (in 13 countries), McDonald’s (15 countries), and Kellogg's (32 countries), among others. In the US, Starcom spent almost $1.4bn on national and regional TV in 1997, and was involved in setting up global deals for lead clients via Leo Burnett Media. Starcom launched in the UK in 1999, and soon capture the centralised Heinz planning account, as part of a growing centralization of Heinz business within the Leo Burnett group. Subsidiary business Starlink was established in 1999 to plan and buy media for smaller agencies, both within the Burnett portfolio and third-party.

Further consolidation was soon on the cards. DMB&B and Leo Burnett already shared at least two big-spending clients in P&G and Coca-Cola. During 1998 DMB&B's corporate holding company MacManus had begun discussions with Leo Burnett about merging their respective media divisions outside the US. These talks drifted on for a year before appearing to stall in early 1999. Rumours began to circulate that DMB&B was investigating a possible merger of MediaVest with another P&G agency instead, Grey's MediaCom network. Suddenly, at the end of 1999, the whole picture was resolved by the barnstorming BCom3 deal, merging the Leo Burnett and DMB&B corporate parents.

It was only a matter of time before further consolidation became inevitable. First, however, Starcom beefed up its UK operations by merging its local office with the media arm of Bartle Bogle Hegarty to form joint venture Starcom Motive. Shortly afterwards a combined team from Starcom and MediaVest were awarded Procter & Gamble's $150m of billings in China, then the biggest single media account in Asia outside Japan. Finally, in 2000, Starcom and MediaVest's dual status was formally resolved with the announcement of their merger to create Starcom MediaVest Group (SMG). Because of brand conflicts, the two arms remained separate in the UK, US and Brazil, but elsewhere most dual operations between the Leo Burnett and D'Arcy groups were merged, mostly as Starcom. The group scored two huge wins in 2000 - the $2.9bn consolidation of GM's planning business and Kraft's $800m consolidated media account.

In 2001, the agency combined its direct response units in the US to create Halogen, a standalone direct planning and buying shop with offices in New York, Chicago and Toronto. Meanwhile Tapestry was created as an alliance between newly formed Bcom3 multicultural arm Pangea and independent shop Unity Media to specialise in the US ethnic and gay market. Following several years of strong growth, the agency celebrated a string of substantial wins during 2003 and 2004, including consolidation of the US media accounts of Sara Lee, Coca-Cola and Mars/Masterfoods. In light of these successes, the agency was named as Advertising Age's US media agency of the year for two consecutive years in 2003 and 2004. See full profile for current activities


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