Adbrands Weekly Update 15th July 2010
A weekly round up of key news about 
leading advertisers, agencies and mediaowners
 
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RECENTLY ADDED PROFILES

Procter and Gamble

Starcom MediaVest

Coca Cola

Young and Rubicam

Unilever

MediaEdge:CIA

Kraft Foods

BBDO

LOreal
DDB

OMD

Nike

TBWA

Sony

JWT

Johnson and Johnson

Carat

McCann Erickson
Apple
Bartle Bogle Hegarty

Diageo

Ogilvy and Mather

Ford Motors

Mindshare

Verizon

ZenithOptimedia

Four of our favourite ads this week: 

Vittoria Coffee "Al Pacino"
by RSA Films/Barry Levinson

Schweppes "Leopard"
by
Mother London

Chevrolet Corvette "Still Building Rockets"
by
Goodby Silverstein

Vigorsol "Walrus"
by
Bartle Bogle Hegarty London

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Regular readers will know that we are always intrigued when Hollywood stars deign to make an appearance in an ad. In most cases, their main concern is to avoid letting the spot be seen in the US for fear of lowering their perceived value. That has caused us some difficulty in the past when we try to show you those ads. Some of you may remember Brad Pitt's Japanese spots for mobile carrier Softbank which we were able to relay for only about a day before they were pulled on instructions from Pitt's agents. Well, never daunted, we will try again with the new Australian campaign for Vittoria coffee featuring one of the gods of the industry Al Pacino, making his first ever appearance in an ad. Nice little spot, although we suspect that Pacino had never tasted Vittoria in his life before he sat in front of the camera. His throwaway compliment - "this is good coffee" - is hardly ringing praise. Movie director Barry Levinson, a Pacino buddy, helmed the ad, which was developed inhouse at Vittoria, working with RSA Films.

Mother London developed this odd little gem for Coca-Cola UK's Schweppes mixer brand. We like the performances, but can't help but suspect that Mother's creative team were more than a little inspired by the drunken family from classic 90s comedy series The Fast Show. See here if you need a reminder.

So, after all the fuss, what are the end results of Chevrolet's abrupt change of agency to Goodby Silverstein? Here is Goodby's debut on the account, a spot to promote the new Corvette. Not bad, but hardly a classic.

And finally, a surreal experience in the Arctic wastes, made by Bartle Bogle Hegarty London for the Italian market to promote Vigorsol gum. Lovely.


In the news this past week: Brands & Advertisers

Global advertising expenditure grew by 12.5% in the first three months of 2010, according to the latest Nielsen Global Adview Pulse report, suggesting the market has "turned the corner" after the sharp declines of the past two years. Nielsen estimated total spend of $110bn for Q1. However the monitoring company warned that the results were helped significantly by one-off factors such as the Winter Olympics and the run-up to the World Cup, and also that the estimate did not take into account discounting on the part of mediaowners. "After 18 consecutive tough months for advertising, we've finally hit positive territory and turned the corner," said Nielsen Global Adview deputy managing director Michelle Strazzera, "but these growth numbers are coming off a very weak base and are mostly based on rate card figures." The best-performing region overall was Latin America, where spend soared by 48%. France was the top performer in Western Europe, with spend up 11%, while the UK rose 8%. Spain, still struggling with recession, posted a further 3% decline. The US market rose by 4% according to Nielsen.

Air France strengthened its position in the UK by agreeing a wide-ranging partnership with independent airline Flybe. The two companies agreed a code-share arrangement whereby Flybe will be able to offer its customers access to five additional routes between the UK and France as well as seven new domestic French routes and 11 international routes. Flybe is already the UK's largest operator of domestic flights, and also has a number of flights between the UK and France, especially to and from regional destinations. The deal has been seen as the potential forerunner to a full buyout by Air France. That would create an intriguing conflict with British Airways, which still holds a 15% shareholding in the smaller company, inherited from the sale to Flybe of the old BA Connect regional service. However, Flybe is majority controlled by the family of founder Jack Walker, who share 69% of its shares. Staff and management hold the remaining 16%.

Nike and Adidas have been arguing between themselves over whose boots scored more goals in the World Cup. The dispute was promoted by a new viral ad from Adidas (see it here) promoting the F50 Adizero as the "top-scoring boot" of the tournament, worn by players including Podolski of Germany, Villa of Spain and others. Nike responded quickly, pointing out that the Adidas tally includes the only two own goals scored during the World Cup, which also came off Adidas boots. If you exclude those embarrassing errors, Nike says, it accounted for 62 goals, while Adidas had 61 (or 63 including the own goals). Puma took nine goals, with the remaining 11 from other boots. Nike also pointed out the winning goal in last weekend's final was scored with a Nike shoe, and that eight of Spanish team in the final were wearing Nike, including scorer Iniesta.

Intel cheered technology investors with the best quarterly results in its entire history. Revenues for 2Q soared to $10.8bn, well ahead of expectations. The group said the figures were generated by a sudden upsurge in development in the "cloud computing" sector, as technology companies expand and refresh their server farms in advance of the expected growth in web-based working.

In a surprise development, US investigators looking into reports of unintended acceleration in Toyota and Lexus vehicles announced that so far they have found no actual faults in electronic throttles controls in the Japanese company's cars, and suggested that in most cases, driver error was to blame. Complaints from US drivers forced Toyota to issue its biggest ever recall of vehicles last year. The company acknowledged that some problems may have been caused by floormats becoming wedged under the pedals, but claimed that it could find no intrinsic flaw in its acceleration systems. Those claims were largely dismissed at the time by the world's media. Yet now even the US National Highway Traffic Safety Administration admits that "despite several investigations of Toyota's electronic throttle control system, NHTSA has not been able to find a defect." Indeed, the director of NHTSA's defects investigation unit told a Senate committee that, in general, most sudden acceleration incidents investigated by the NHTSA in all manufacturers' vehicles over the past three decades "probably involve the driver unintentionally pressing the accelerator when braking was intended".

Santander expanded its footprint in Europe's largest economy by agreeing to acquire the German customers and branch network of Swedish bank SEB for around €555m. That doubles Santander's branch network in Germany to more than 300 outlets.

Avon Products, the world's biggest direct seller of beauty and cosmetics products, announced plans to acquire Silpada Designs, a seller of sterling silver jewellery, for around $650m. That deal is intended to expand Avon's offering of fashion-related products.  

In personnel news, Diageo named Gavin Pike as the new global brand director for Johnnie Walker. His predecessor David Gates is now global category director for all the group's whisky brands. Simon Freedman, group head of marketing at the Football Association in England, announced his resignation to join O2 as head of sponsorship. He will oversee the mobile operator's extensive partnership portfolio, which include O2 arenas in the UK, Ireland and Germany, the O2 Academy network of smaller live music venues, and sponsorships of the RFU and Arsenal football club. 

Philips named Frans van Houten as the designated successor to CEO Gerard Kleisterlee, who is due to retire next year. Van Houten was previously head of Philips' electronic components operations, which were spun off four years ago as NXP Semiconductors. He spent several years as chief executive of NXP before becoming a consultant to Dutch bank ING. He will join Philips as chief operating officer later this year, before becoming chief executive next April.

Reckitt Benckiser promoted Phil Thomas, previously UK marketing director, to an international role as global category director for surface care. He was replaced as UK marketing director for surface care, household and healthcare by Stefan Gaa. Jim Press, the former head of sales and marketing for Toyota USA and later Chrysler, has been hired by Nissan to advise it and its alliance partner Renault on sales and marketing in the US. Press left Chrysler at the end of last year following its effective takeover by Fiat.


In the news this past week: Agencies

Crispin Porter & Bogusky added another outpost to its growing network by absorbing noted Canadian creative agency Zig Inc, already a subsidiary of CPB's parent group MDC Partners. Zig will retain its existing management team, but is to rebrand as CPB Canada. It becomes CPB's second full-service agency outside the US. Swedish creative and digital agency Daddy joined the group last year, becoming the agency's European hub. 

Shareholders of marketing services group Creston voted in favour of the sale of its flagship agency DLKW to Interpublic. As a result, DLKW has now begun the process of merging with struggling Lowe London to create DLKW Lowe. DLKW staff and management are relocating to Lowe's offices in Chelsea.

Omnicom is to phase out the Agency.com brand in the US after several years of weak performance. The main New York outpost now operates under the auspices of TBWA\New York, while its Chicago outpost has been absorbed into digital production unit TBWA E-graphics. The agency's third US office in San Francisco has been spun out as a separately branded unit under the new name Signal To Noise, though still under Omnicom's ownership and reporting through TBWA. President-CEO Jordan Warren said of the relaunched shop, "We're creating a new breed of Agency of Record, one that uses customer insights supported by data to inform ideas and drive dramatically better marketing results."

Eric Hirshberg, co-CEO and chief creative officer of Deutsch LA, is leaving to join software group Activision Blizzard as CEO of their publishing division, responsible for development of games including Call of Duty and Guitar Hero. 

Publicis Groupe strengthened its hold on Nestle's business in China with the acquisition of G4, a local full-service agency that works mainly on the Swiss food and beverage giant's brands. The Chinese agency will merger with the Beijing office of Publicis Worldwide to form Publicis G4.

Regional British agency Brahm, based in Leeds, is to rebrand under the new name Brass, following a merger with digital subsidiary Swamp. The newly rebranded company promises a fully integrated offering.

Bartle Bogle Hegarty has resigned the Levi's account which it had held for almost 30 years. Levi's was one of BBH's founding clients in the UK, and it gradually extended its hold on the account to cover all of Europe and Asia. However, according to press reports, the relationship had become increasingly strained in recent years because of Levi's unwillingness to sign off on BBH's creative ideas. Wieden & Kennedy manages the account in North and Latin America.

In other account assignments, Diageo consolidated global digital and CRM for its Bailey's liqueur with Chemistry. Isobar was awarded global digital duties for Coca-Cola's Sprite brand. In the UK, insurance comparison site Confused.com called a review of creative out of Beattie McGuinness Bungay. For all appointments, subscribers can access the full Adbrands Account Assignments database here


In the news this past week: Media

Hugh Hefner made an offer to buy back the shares in Playboy Enterprises that he doesn't already own, valuing the loss-making group at $185m. The 84-year-old Hefner currently owns around a third of the business, which has cable and leisure interests as well as its core asset of Playboy magazine. Incredibly, Hefner still maintains close involvement with the seminal title he founded almost 60 years ago. He still selects all covers and personally approves the design of every page in each issue. Hefner's proposal, which is underwritten by private equity fund Rizvi Traverse Management, immediately triggered statements of interests from other bidders including FriendFinder Networks, which owns dating services as well as the rival adult entertainment empire Penthouse.

David Pemsel, marketing director for UK broadcaster ITV, is leaving the company. Last week, overall responsibility for marketing was transferred to ITV's direct or of programming Peter Fincham, following the departure of brand & commercial director Rupert Howell earlier in the summer.

Barry Diller, chairman of Expedia and of digital group IAC, voiced his opposition to Google's recently announced plans to acquire ITA Software, a specialist in online ticketing systems. A number of rival publishers have already criticised Google's growing tendency to rank its own services, such as maps and weather, higher in search results than other providers, most of whom rely on Google referrals for their traffic. Diller is the most important industry figure to-date to join that dissenting group. "I think it is disturbing," he told the Financial Times, "that Google is moving into serving individual spaces, rather than being search neutral. It is a dangerous step because it is inevitably going to cause problems with customers and regulatory authorities." Diller described the acquisition of ITA as potentially the most serious such development, "a frontal assault on a core area of internet life" in which Google was "using its market power" to gain an unfair advantage. The ITA purchase is expected by many observers to lead towards Google selling tickets directly to the public, a move that would create a major conflict with Expedia, currently one of its biggest advertisers. 

Last Sunday's World Cup final scored then highest audience ever seen in the US for a soccer event, attracting 24.3m viewers, up from 19.3m who watched the US team lose to Ghana earlier in the tournament. That marked a significant step forward for soccer in the US, although it still lags far behind other more traditionally American sports. By comparison, the Super Bowl earlier this year attracted an average audience of 106.5m viewers. Nevertheless ABC, which held joint US broadcast rights to this year's World Cup with Hispanic network Univision, said it scored an average audience across the tournament of 3.26m viewers, up from 2.32m for the 2006 World Cup.

In an intriguing move that unites internet investors from three important developing markets, South Africa's Naspers media group acquired a 29% shareholding in Digital Sky Technologies (DST), Russia's biggest internet group. In addition to pay TV in its own country, Naspers also controls a 35% holding in one of China's biggest internet publishers Tencent, which already has its own 10% stake in DST. The Russian company registered on Western radar recently with its acquisition from AOL of the ICQ messaging service. It is also a shareholder in Facebook, having acquired a 2% shareholding last year for around $300m. However , it is best-known at home for its Mail.ru site, which is Russia's most visited web portal, attracting some 50m unique visitors per month. It also owns the region's most popular social media service Vkontakte. In total, DST's portfolio accounts for around 70% of all page views of Russian language websites.

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Simon Tesler
Publisher, Adbrands