Adbrands Weekly Update 17th June 2010
A weekly round up of key news about 
leading advertisers, agencies and mediaowners
 
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Four of our favourite ads this week: 

Dodge "Freedom"
by Wieden & Kennedy

Jeep "Manifesto"
by Wieden & Kennedy

Travelers "Watering Hole"
by Fallon

Amnesty International "Death Penalty"
by TBWA\Paris

Update only subscribers: click here to view Ads of the Week

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Wieden & Kennedy have been working hard. We wouldn't normally devote two spots in the same Ads of the Week to the same agency and the same manufacturer, but these ads for Chrysler Group's Dodge and Jeep brand businesses deserve the space. Bouncing back from bankruptcy can't be easy, but if this aggressive and imaginative approach is carried through in the cars themselves, then Chrysler might just make it. Yes, the ads play the patriotism angle shamelessly (ironic for a company now controlled by Italians), but they do it effectively and honourably. Good for you, W&K.

Fallon's new ad for US insurer Travelers plays like a live action version of the Madagascar movies. (The only thing missing is King Julian). It's a cute concept, pulled off nicely (although we think the CG looks a little clunky in a couple of places).

And finally, Amnesty International has a long history of top-notch advertising, generally commissioned out of France, and often executed (if that isn't too unfortunate a word in this context) by TBWA\Paris. We've featured the organisation several times before in this position, and this is another first-rate spot, created by production collective Pleix and post-production house Digital District. And how's this for the extra wow factor? That's not wax. Apparently, the ad was shot initially with wax figures, but the melting effect didn't look right and was too hard to control. So instead the melting was achieved almost entirely with CG. It took months to get it right. Amazing.


In the news this past week: Brands & Advertisers

BP remained firmly in the firing line over its catastrophic Gulf of Mexico leak, still gushing tens of thousands of barrels of oil into the ocean. President Obama waded into the row last week, initially playing the nationalist card by insisting on referring to the shamed company as "British Petroleum", a name it stopped using 12 years ago. This led to complaints from British Prime Minister David Cameron that the President was stirring up anti-British prejudice because of the actions of a single company. Obama moderated his language after this, but vowed to make BP pay for the devastation caused by the disaster. In a televised address to the nation, Obama promised to force BP to "set aside whatever resources are required to compensate the workers and business owners who have been harmed as a result of [the] company’s recklessness". Responding to pressure from the President and from Congress, BP cancelled its shareholder dividend and agreed to set aside a $20bn fund to compensate victims of the spill. However, Obama also called on Americans to take steps to reduce their dependency on oil. Partly in response to the latter call, BP's rivals ExxonMobil, Chevron, Shell and ConocoPhillips, have been quick to distance themselves from their beleaguered competitor. Questioned by Congress on safety standards in the industry, the heads of both ExxonMobil and Chevron suggested that BP's operating procedures on this oil platform were inadequate, and did not follow the industry norm. Their argument in short was that this was a one-off incident and wouldn't have happened on one of their rigs. A Congressional committee has already accused BP of making "multiple decisions for economic reasons that increased the danger of a catastrophic well failure" in the days leading up to the April 20th explosion, in some cases against the advice of key contractors. BP's CEO Tony Hayward will appear before Congress today (Thursday) where he is likely, in the words of one Congressman, to be "sliced and diced".

AT&T was forced to stop accepting preorders for the new iPhone 4 handset this week as a result of massive demand. In just one day on Tuesday, Apple took more than 600,000 orders for the new device, the highest number of preorders the company had ever received. Meanwhile, Nokia's share price slumped by 10% after the company warned that its 2Q results were likely to come in below forecast because of intensifying competition at the top end of the market from Apple, from Samsung in the middle market, and from low-end manufacturers such as ZTE in China. According to research from IDC, Nokia's share of the smartphone market was flat at 39% for the first quarter of 2010, while Apple's jumped to 16%, from 11% in 1Q 2009. There were also modest market share gains for HTC and Motorola. However, Blackberry's share fell from almost 21% last year to 19.4%. In the wider handset market, Nokia's share fell from over 38% to under 37%, while Samsung rose from under 19% to almost 22%. The biggest loser among the top five was Sony Ericsson whose share slumped from 6% to 3.6%. It was also the only one of the top five to experience a net fall in the number of handsets sold.

Microsoft has launched a new version of its Office business suite that is available free online (from here). The programs are streamlined versions of the full paid-for versions of Word, Excel and Powerpoint but still have all their main functions intact. Instead of being stored on your computer's hard drive, they're hosted on Microsoft's own servers, and the group hopes to use these "lite" versions of the real thing as a platform for upselling to a full-function web-based suite. The strategy is designed to head off increasing competition from Google's web-based Docs suite. Microsoft also launched a new slimmed-down version of its Xbox 360 gaming console, which it hopes will further widen its lead over the lacklustre Sony Playstation 3. Meanwhile, Sony and Nintendo unveiled a collection of 3-D products, including a 3-D version of the Nintendo DS handheld, and a selection of 3-D games for the PS3. Sony also said it would launch its new Playstation Move controller, an equivalent to Nintendo's Wii wand in September.

Sara Lee provided further information regarding the sudden leave of absence of CEO Brenda Barnes last month. In a press statement issued this week, Barnes revealed that she had suffered a stroke and was now recuperating. The group said it would provide a further update on Barnes' recovery and future plans in August. Separately the group agreed the sale of its remaining insecticides in Europe and Asia to SC Johnson for €154m. It also received a legal challenge from Nestle over its launch in France of a generic range of coffee capsules for the Swiss company's Nespresso coffee system. Sara Lee introduced its L'Or Espresso capsules, which retail at well below the price charged by Nestle for their own capsules, in April.

Nestle UK appointed Vernon Bradley as group marketing director, a new role, reporting to chief executive Paul Grimwood. Previously, each of Nestle's operating divisions has maintained a separate marketing head. These will now report to Bradley. Elsewhere, Mark Sinnock quit as marketing director for supermarket group Asda, and was replaced by Jon Owen, previously head of marketing strategy. Owen will report to Walmart's international marketing director Rick Bendel.


In the news this past week: Agencies

Research group Nielsen has merged its social media monitoring service BuzzMedia into a newly formed joint venture with management consultancy McKinsey, under the new name NM Incite. The service will operate in 15 leading markets including the US and UK. Dominic Barton, global managing director of McKinsey, said "Social media is an increasingly critical issue for business leaders and an area of untapped opportunity for many of our clients. This joint venture will equip institutions with real-time insights to help their leaders drive better results."

A team of executives from TBWA and Razorfish have launched their own agency in London with backing from WPP. True Worldwide's four founders are Tony McTear and Simon Law, formerly creative director and head of planning respectively at TBWA, and Neil Miller and Chris Perry, the former joint chief executives of Razorfish London. WPP is understood to have acquired a 49% stake in the business. Separately, Colleen DeCourcy, global chief digital officer at TBWA Worldwide, is to leave the agency this summer. It's not clear yet whether she will be replaced.

Aegis unveiled further details on the restructuring of its digital network Isobar. The group intends to roll out iProspect, currently Isobar's US search marketing brand, into other territories. One of the first units to adopt the new name will be UK-based Diffiniti, itself created from the old Carat Interactive business. Diffiniti chief executive Ben Wood stays on in the same role, reporting to Carat's Rob Horler.

In account assignments, Kraft moved a clutch of cookie products out of Draftfcb in the US and into another roster shop, McGarryBowen. Brands affected included Chips Ahoy and Fig Newtons. Arnold Worldwide added to its run of new account wins, picking up creative duties for insurer Aetna. MySpace launched the hunt for a creative agency to take charge of a new global campaign to win back audience from Facebook. In the UK, AB InBev called a review of media, currently split between Starcom MediaVest and the former Anheuser-Busch inhouse team. British Gas reappointed Carat after a review. WCRS is facing a review of the Santander banking account, and resigned its place on the Ferrero confectionery roster. It had handled Ferrero Rocher and Tic Tac. For all other appointments, subscribers can access the full Adbrands Account Assignments database here

Senior agency folk around the world will be packing their bags tomorrow for the 2010 Cannes Lions Festival, the industry's most prestigious beanfeast, which kicks off this coming Sunday. Sadly, we at Adbrands will not be found on the Croisette or propping up the Gutter Bar, but we will aim to bring you any key news, as well of course, as the names of the winners.


In the news this past week: Media

Shares in BSkyB, the UK satellite broadcaster, soared after part-owner News Corporation made an offer to acquire the 61% of equity it doesn't already control. The GBP 7.8bn News Corp bid valued the entire company at around GBP 12.6bn. However, BSkyB's independent directors rejected the offer as too low, and suggested that they would be looking for an offer of closer to GBP 8.8bn. News Corp is likely to return with a new bid, but the biggest hurdle it faces will not be price, but the concerns of UK regulators already worried about the level of control Rupert Murdoch has over the British media as a whole. But why spend up GBP 8bn or more on a company that News Corp already in effect controls? Several commentators pointed to the benefits of Sky's healthy cash flow, and an expected sharp upturn in future profits. However the Financial Times suggested that perhaps "the swashbuckler is losing his appetite for adventure... [The fact] that Mr Murdoch has nothing better to do with his cash is either a sign he has run out of ideas, or an indictment of the opportunities in the media sector."

The World Cup coverage of UK broadcast network ITV appears to be jinxed. Last weekend, the channel suffered a serious technical glitch when coverage of the game between England and the USA on its recently launched HD service was inexplicably interrupted by a sudden unscheduled cutaway to an ad for Hyundai. That wouldn't have been too serious in its own right. However, the 20-second interruption took place in the 4th minute of the game, moments before England's Steven Gerrard scored the team's opening goal of the tournament. The HD coverage switched back to show the England players celebrating, prompting a deluge of complaints from irate viewers. ITV blamed a technical error by transmission services company Technicolor. However the glitch followed an earlier snafu last week when the premiere of Nike's 3-minute World Cup ad was cut short. ITV is understood to be paying a significant amount in damage to make amends for that howler. In yet another disaster for the broadcaster, it was forced to sack sports pundit Robbie Earle, after the former footballer was found to have purchased a block of tickets for the Holland vs Denmark game apparently on behalf of a commercial sponsor. FIFA rules state that presenters are allowed to buy block tickets but they must not be passed on to unauthorised third parties. In this case, the tickets were used by Bavaria Beer for an "ambush marketing" stunt designed to undermine official tournament sponsor Budweiser. Bavaria sent a group of 36 women to the match wearing promotional minidresses with the aim of making an appearance on-camera. Robbie Earle appears to have got off lightly with a sacking. South African police have arrested the two "ringleaders" among the Bavaria beer girls, and they are currently in jail awaiting a court hearing..

The main US broadcast networks wrapped up this year's upfront ad sales market with a combined total of between $8.3bn and $8.7bn, a modest but significant increase on last year's total, which was estimated at between $7.8bn and $8.1bn. NBC was the last to close with around $1.6bn for its main network.

Guardian Media Group, owner of the Guardian and Observer newspapers and part-owner of EMAP business media, reported record losses for its most recent financial year. Pretax losses for the year to the end of March 2010 reached GBP 171m, up from almost GBP 97m last year. The latest figures include a GBP 160m writedown in the values of the group's business and radio divisions. The current year will also be awash with red ink, and will include a GBP 47m loss on the sale of the group's regional newspapers. Turnover for the year ending 2010 slipped 10% to GBP 280m. Nevertheless, group chairman Amelia Fawcett insisted that GMG was well-positioned for the future, pointing out that the losses were caused mainly by non-cash impairments rather than a serious decline in trading. "Due to the long-term approach taken by the group and its sole shareholder," she said, "the value of our portfolio of assets and investments, and improving economic conditions, there is every reason to be confident about the future of GMG and, most importantly, its ongoing ability to support the Guardian's journalism." GMG is owned by the Scott Trust, established in the 1930's by the family of the original editor and owner of what was then the Manchester Guardian. The group's chief executive Carolyn McCall is to leave the business later this year. Her successor has yet to be named.

Are we in the wrong job? Oprah Winfrey took time out this week to drop by the offices of Hearst Magazines, which publishes O The Oprah Magazine, now celebrating its 10th anniversary. Oprah gave every employee of the title, now matter how long they have worked there, a brand new iPad complete with a leather carrying case inscribed with their own initials, as well as a check for $10,000. Nice work if you can get it...

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Simon Tesler
Publisher, Adbrands