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Four more ads for your delight and delectation. France's CLM/BBDO
comes up trumps once again with another spot in its Pepsi Max "fake-up" series. Wieden & Kennedy
indulges in some spectacular digital trickery to create a human chain for Nike. Saatchi & Saatchi London
tweaks Visa's "Running Man" concept to prove that being a couch sports spectator can ultimately pay
dividends. And finally, Butler Shine & Stern offer the wicked side of the new Mini Clubman. Enjoy.
In the news this past week:
Brands & Advertisers
British Airways got a much-needed lift from the decision
by US regulators to approve a long-discussed closer alliance with American Airlines and Iberia. The three
airlines would be granted permission to collaborate on pricing and services provided they surrender four pairs of
takeoff and landing slots at Heathrow. The last time they applied for permission, back in 2001, they were ordered to
surrender 16 paired slots, a level they considered unacceptable at the time. Approval is also needed from European
competition regulators, but in the meantime the partners can proceed with implementation of their plan.
More big marketers unveiled financials for 2009. At PepsiCo,
overall performance was satisfactory, with revenues more or less unchanged in a difficult market at $43.2bn and net
income up 16% to $5.9bn. However, despite the group's radical restructuring of its drinks business early last year, the
strongest performance was once again from the Frito-Lay snacks division. In the Americas, where most of the beverages
"refresh everything" project took place, revenues actually slipped 8% over the year. That decline was offset
by continued growth by Frito-Lay North America, which increased its lead as PepsiCo's single biggest business unit.
Foods now generate two-thirds of revenues in the Americas and as much as three-quarters of sales elsewhere. Kraft
also reported satisfactory results for 2009. Revenues dipped by 4% to $40.4bn, but net profits rose 5% to over $3.0bn.
L'Oreal's financial performance for 2009 showed the
impact of the recession. Revenues were essentially flat, dipping from just over to just under €17.5bn, while net profits
drifted 8% lower from €1.9bn to €1.8bn. Only the group's consumer products division reported an increase in revenues, of
just 1.5% on a reported basis. That was generated by a shift by shoppers away from higher-priced products, and helped by
L'Oreal's introduction of lower-priced cosmetics products, mainly under the Garnier name. The group's premium-priced
ranges of luxury and professional products and active cosmetics all suffered a decline. As has been the case with most
other major marketers, the declines were most pronounced in North America and Western Europe, while the strongest
increases were seen in Asia, and especially China. Walmart's sales were also below investors' expectations,
with full year sales edging up by only 1% to $405bn. Net income did better, up almost 7% at $14.3bn.
Barclays was the first of the big British banks to
release figures for 2009. Pretax profits doubled to a massive £11.6bn on revenues up by more than a third to just under
£31.0bn. The results were helped considerably by a £6.3bn gain on the sale of the Barclays Global Investors division;
but even without those and other one-off or unusual gains, underlying performance showed strong growth. The retail and
commercial lending businesses continue to suffer from loan losses, with a sharp increase in impairment charges. However
that decline was more than offset by dynamic performance from Barclays Capital, the institutional and investment banking
division which now incorporates a large part of the failed Lehman Brothers business. To show consideration for what
the bank described as "the continued impact of the economic downturn on many clients, customers and shareholders,
combined with the fact that banks and bankers' pay remain matters of intense public interest and concern", Barclays
chief executive John Varley and president Bob Diamond agreed to waive their bonuses for a second consecutive year.
US drugstore giant Walgreen agreed to acquire New York's
well-known Duane Reade chain for $1.1bn including debt, increasing its presence in one of the country's most
important markets from 70 outlets to 327. Although currently loss-making, Duane Reade is renowned for having the highest
revenues per square foot of any US drugstore chain, averaging $7m a year from each of its generally small format New
York stores. Walgreen's said it would keep the Duane Reade name, although it will gradually "harmonise" the
The CEOs of Unilever and Diageo added their voices
to the general disquiet among business leaders over tax proposals currently under consideration by the British
government. A new top tax rate of 50% is being introduced in April, and other changes are likely to follow in order to
reduce the UK's large budget deficit. One already under consideration is a reform of the tax on profits generated
outside the UK. Paul Walsh of Diageo said "the UK has become progressively a less attractive location to base
oneself in. We enjoy being headquartered in London, but if the tax regime here in the UK becomes so egregious, either
for corporates or individuals, we will have no option but to look at other alternatives... It is very hard to locate
people in London as a global business when you are dealing with taxes of 50%."
Several industry observers have been considering what might
happen to Unilever's marketing following the departure, announced last week, of CMO Simon Clift. Clift has long
been a champion of mould-breaking and memorable advertising, such as Dove's Campaign for Real Beauty, Persil/Omo's Dirt
is Good, or the Axe/Lynx advertising. It grabs headlines, yes, but how good is it at selling products in the medium to
long term? Unilever's new CEO Paul Polman, trained at Procter & Gamble and Nestle, is known to favour more
straightforward marketing that focuses on product benefits rather than clever ideas. He may not be wrong. Last week we
compared Unilever's lacklustre performance with the shining results of Reckitt Benckiser, perhaps one of the best
examples of a marketer which favours old-school hard sell above quirky concepts. Adweek suggested that Clift's departure
could have a deleterious effect on the position of creativity-led shops like Lowe, BBH and Santo on the Unilever roster.
Financial services entrepreneur Peter Wood raised private
investment funding to buy back full control of his auto insurance business Esure from Lloyds Banking Group.
Wood was also the original founder of the Direct Line insurance business, now owned by Royal Bank of Scotland. He
launched Esure as a partnership with Bank of Scotland, and later spun out a secondary insurance brand under the name
Sheila's Wheels. Although Bank of Scotland, later HBOS, held a majority stake in the business, Wood himself retained
management control, as well as a change-of-ownership escape clause. That was effectively triggered by the takeover last
year of HBOS by Lloyds. He is understood to have paid £185m for Lloyds' shares, valuing the business at around
Carl-Peter Forster, the recently ousted (or resigned) head of GM
Europe has re-emerged as the new CEO of British-based Jaguar Land Rover, the prestige automobile business now
owned by Tata Motors of India.
Lloyds Banking Group is set to appoint Eva Eisenschimmel
as its new chief marketing officer. She will replace Nigel Gilbert, who left the group last year. She is currently chief
officer for people, operations & brand performance at EDF Energy UK. Meanwhile, there have been several changes
within the marketing ranks at Vodafone. Global head of brand communications David Wheldon's departure was
announced last week. This week, UK consumer director Ian Shepherd left the company abruptly, and was replaced on an
interim basis by strategy head Mark Bond.
Verizon Wireless announced a partnership with Skype
to offer VoIP services on at least eight current Verizon smartphones, allowing free voice calls and messaging to other
Skype customers worldwide.
Troubled music group EMI put its famed Abbey Road
recording studios up for sale. The group is struggling to raise cash to avoid a loan default that would allow its
bankers Citigroup to seize control of the business.
Lee McQueen, the widely admired founder of the Alexander
McQueen fashion label, was found dead at his home in London last week, having apparently committed suicide. He was
40. The business was a joint venture with the Gucci division of French retail and luxury group PPR. Despite the
critical acclaim, the Alexander McQueen business has reported profits only once since its creation, and was reported to
have current liabilities of as much as £32m. However its founder's suicide was thought to have been prompted mainly by
the death of McQueen's mother earlier this year.
In the news this past week:
Publicis Groupe reported annual results for 2009.
Revenues slipped around 4% to €4.5bn (or $6.3bn) and net income declined 10% to €403m. On an organic basis excluding
currency and acquisitions, the full year decline in revenues was 6.5%, improving in the final quarter to 5.4%. As
always, CEO Maurice Levy was able to put a healthy shine on a difficult year: "While our marketplace
experienced a double-digit downturn, we were able to stop the slide and cut it by half, thus actually gaining market
share... the market overall was down by 12% to 14%, Publicis managed to limit the decrease to 6.5%, thereby gaining
market share." Levy said that conditions had improved over the past couple of months. "Our
objective," he said, "is to return to organic growth in 2010." Last week, rivals Omnicom and Havas
reported organic full-year declines of 8.7% and 7.9% respectively. Digital played a large part in Publicis's resilience.
Helped along by the acquisition of Razorfish, digital activities demonstrated organic growth of over 7%, and that figure
would have been much higher without the problems of key client General Motors. In North America, digital activities
contributed almost 36% of local revenues. Net new business was very strong at $6bn, placing Publicis well ahead of all
its rivals. Interpublic is set to report next Friday; WPP the following Friday.
British marketing group Engine, parent to the WCRS
advertising agency as well as a clutch of other units, has launched its a subsidiary in the US. The company has hired
two local luminaries to guide its development Stateside. Martin Puris, previously one of the names above the title in
New York agency Ammirati Puris Lintas, was appointed as CEO. John Bernbach, son of the legendary DDB founder Bill
Bernbach, is COO.
Meanwhile Australian marketing group Photon also voiced
its ambitions to develop a wider global presence. Currently, Photon is best-known outside its native country as the
owner of British-based communications planning network Naked. However it also owns a sizeable portfolio of admired
marketing services companies in Australia, including the creative agencies BMF and BWM. Now the group is
considering establishing an office in Asia for BWM, and in Europe and North America for BMF. According to Jon Wilkins,
one of Naked's co-founders and now head of Photon's integrated communications division, BMF and BWM are "stellar,
world class agencies and there is scope for them to expand outside Australia". In an interview with local trade
paper B&T, Wilkins highlighted the two shops' fully integrated offering, which was he suggested superior to their US
or European equivalents. "Australia's agencies have turned a negative into a positive. They used to do everything
but the brand spot, so they became very strong on integration. In London and New York, agencies are struggling to alter
their offer. Every agency is desperate to be integrated because their businesses are lop-sided. In Europe and the US,
there is a desire to start afresh with a new model. BMF have worked through that model and are truly integrated. A
client not happy at, for example, JWT Chicago might look to BMF."
Havas reshuffled senior managers at its two main agencies in the
US. Andrew Bennett was named as the new global CEO of Arnold Worldwide. He replaces long-serving Fran Kelly, who
moves up to vice chairman. Bennett crossed over from Euro RSCG New York, where he was co-CEO with Jeff Brooks.
Instead, Brooks will now be partnered by Pete Zillig, previously president of global brands working out of Euro RSCG
London. Bennett's main brief is to fix a run of client losses at Arnold, and re-establish the business as a global
Wieden & Kennedy took some flak after ad watchers in
Israel noticed striking similarities between Coca-Cola's Sleepwalker ad aired during the Super Bowl with an old Israeli
ad for flavoured milk. Both ads have the same set-up, several shots are near-identical and - most striking of all - both
use Ravel's Bolero for their soundtrack. The industry is always dealing with some accusation or other of creative
plagiarism, but this is the first time that the revered Wieden & Kennedy have been on the receiving end. See a
comparative cut of the two ads side by side here.
Bayer concluded its review of global creative and media,
consolidating almost all of its business with WPP and Omnicom. WPP's GroupM will handle media in all markets
except the US, where Interpublic's Initiative retains the account. The group is understood to be building a new
dedicated unit to handle the account. Creative will be split between WPP's JWT partnered by Ogilvy Healthworld;
and Omnicom's BBDO partnered by Cline Davis Mann. A precise brand-by-brand breakdown has not been
released. Ultimately, marketing communications engagements now handled by over 400 disparate agencies around the world
will be consolidated. Bayer Healthcare CEO Arthur Higgins said he expected to be able to reduce overall marketing costs
by around 10% annually. Sandra Peterson, CEO of Bayer's medical devices unit, commented: "We believe that we have
an opportunity to take 'integrated marketing' to a new level, linking all classes and media types and in doing so,
making Bayer Healthcare a world leader in this area."
WPP won several other important accounts this week. In the UK,
the group's fledgling Maxus office scored its biggest win to-date with the capture of BT's consolidated
media account, which will move from Starcom and Aegis-owned Zed from April. Brand Republic reported today that Mediaedge:CIA
has been awarded the global communications planning brief for Bacardi. Local planning and buying will still be
handled by other agencies - Universal McCann is the incumbent in most markets - but MEC will handle umbrella strategy
for the flagship rum, as well as other group-owned brands including Grey Goose and Martini. MEC was also awarded the
communications planning brief for the government's Department of Work & Pensions.
In other account assignments, Starcom MediaVest was
awarded pan-Euro media for Honda. The NASDAQ stock exchange shifted advertising from McKinney to McCann
New York. McCann's Australian office picked up the debut campaign for the launch there of US auto insurer Progressive.
Bang & Olufsen moved global creative to Ogilvy Paris. Volkswagen appointed Draftfcb to
handle direct marketing in the US. Grey captured pan-European responsibility for Santander's online
banking service OpenBank. Burger King appointed indie Heimat to handle advertising in Germany. For all
other appointments, subscribers can access the full Adbrands Account Assignments database here.
In the news this past
The Wall St Journal reported that Procter & Gamble
and Walmart have joined forces to fund the production of a two hour made-for-TV movie "in an effort to
promote 'family-friendly' alternatives to what they say is increasingly risqué TV fare". According to the WSJ, the
Secrets of the Mountain movie "highlights values - such as generosity, honesty and togetherness - that Walmart and
P&G executives say are in short supply on television." The movie will feature several product placements, and
ad inventory surrounding the broadcast will be restricted to its lead sponsors. Audience fragmentation usually gets the
blame for the sharp fall in ad revenues experienced by the major broadcast networks in recent years. However another
major factor has been cold feet at more conservative advertisers over increasing levels of sex and violence in
traditional TV fare. The networks have been pushing the outside of the envelope in order to attract more viewers, but in
the process drive away advertisers looking for a family audience. "We're at a point where we really couldn't
increase our advertising significantly from here unless we have more programming options," says Walmart's chief
marketing officer, Stephen Quinn. Marc Pritchard, global brand-building officer at P&G, and the father of three
daughters, said "I like to think of it as 'no-lunge TV,' meaning I don't have to lunge for my remote. I have been
lunging for the remote quite a bit. My arm is a little sore."
US cable giant Comcast has begun the process of
rebranding its TV, telephony and internet services under the new name Xfinity. The brand is gradually being rolled out
in selected markets, commencing this week with cities including Chicago, Boston and San Francisco. The company claims
it's more than just a rebranding exercise, and comes with a greatly expanded line-up of more movies, and more HD
channels. The Comcast name remains for the company itself, but its various connection services will all eventually adopt
the Xfinity name.
Microsoft's Bing search engine appears to be making slow
but steady progress in its attempts to steal market share away from Google and Yahoo. According to latest
figures from research bureau comScore, Bing captured 11.3% of all US searches in January, up from 10.7% in December. It
took share equally from Google and Yahoo. The former remains the undisputed gorilla in the room, with 65.4%, down from
65.7% in January; Yahoo held 17.0%, down from 17.3%.
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