Adbrands Weekly Update 20th May 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: 

Google Chrome "Speed Tests"
by Bartle Bogle Hegarty New York

Cosmote "Open Space"
by Bold Ogilvy Athens

Comcast "War Is Over"
by Grupo Gallegos

VH1 "If You Like"
by Y&R New York

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

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Four more great new spots for you this week. First up, the new viral from BBH New York for Google's Chrome web browser. This offers a variety of bizarre contraptions - the sort of thing Heath Robinson would come up with if he was a co-presenter on the Mythbusters TV show - to demonstrate Chrome's quick loading time. Frankly, this is something of a mountain/molehill situation, since a millisecond here or there between browsers doesn't make a whole lot of difference, especially since the biggest problem with load times is the size of the web page or congestion on your broadband connection. But who cares when you've wonderful devices like this to marvel over? Nifty.

We've admired Bold Ogilvy's ads for Greek mobile service Cosmote before. This is another doozie (or is that doozy?). We wouldn't of course dream of making any tasteless jokes about how convenient Cosmote's new offer is now that the Greeks can no longer afford walls for their buildings.

This new ad for Comcast is - we think - by Grupo Gallegos, best known as a Hispanic agency, and follows on from a successful radio campaign along similar lines. It's not a new idea, but these comic Gladiator-inspired ads always tickle our fancy.

And finally, one of two very weird new ads by Y&R New York for the cable music channel VH1 in Latin America. Neither make any sort of sense but we love them both. This one has a slight edge we think, working a weird riff on the home-voting schtick from reality TV shows. Those "boobs with fake boobs" at the end are a real mind-opener. As the Adfreak blog pointed out, they're like something Terry Gilliam would see after eating too close to bedtime. And you should definitely check out the other ad, AntiRockstar, as well. No boobs with fake boobs, but arguably something much, much stranger...


In the news this past week: Brands & Advertisers

Procter & Gamble is being forced to fight a growing tide of negative feedback over what was intended to be its most important product launch for 25 years. A new variant of its Pampers diapers, Pampers Dry Max, claims to be not only more absorbent than the old design, but also 20% thinner because the gel which soaks up and solidifies waste liquid is imprinted directly onto the diaper itself rather than impregnated on bulky cellulose padding. However, for the past couple of weeks the company has been fighting a rearguard action against a small but increasingly vocal group of consumers who claim that the new diaper has caused severe skin irritation on their babies. Some have even gone as far as to compare the results to "chemical burns". This negative feedback is spreading like wildfire across the internet, much of it originating on Facebook, where users have created multiple petition groups calling on the company to dump the new design. The biggest of these now has almost 10,000 members. One group of parents has even filed a class action lawsuit against the manufacturer. P&G denies all the accusations, assuring consumers of the product's safety and pointing out that Dry Max has been "one of the most tested diapers in Pampers history". In a move which has if anything served only to heighten the bad feeling out there, P&G suggested that any such skin irritations were the result of infrequent diaper changing rather than the product itself and argued that "these rumours are being perpetuated by a small number of parents, some of whom are unhappy that we replaced our older Cruisers and Swaddlers products while others support competitive products and the use of cloth diapers."

Separately P&G is making its biggest push to-date into direct-to-consumer sales with the launch of the Procter & Gamble eStore, offering ecommerce sales of its top-selling household and personal care products. The company has flirted with ecommerce several times in the past, including an upgrade of The Essentials, a web store it acquired as part of Gillette. However the new service, which is being run under contract by ecommerce service provider PFSWeb, marks its most aggressive push so far, putting it in competition with the online sites of traditional retailers such as Walmart or Walgreens. In an interview with the Financial Times last year, P&G CEO Bob MacDonald flagged up this latest development, saying "I don't feel the need to have every sale go through a retailer. We want to maximise our sales through retailers but we also want to be where the consumer wants to shop."

Nestle is attempting to replicate the enormous success of its Nespresso coffeemaker with a new device designed to corner the market in premium tea. Like Nespresso, the new Special.T system uses single-serve capsules, and the launch range will include no less than 25 varieties, including green, black, blue, red and white teas as well as flavoured teas and organic herb teas. The machine automatically calculates the correct brewing time and temperature for each type of tea. The system will launch in France in September. If successful it will roll out in other markets after that.

Boots became only the third British retailer in history to report annual profits of over £1bn. For the year ending March 2010, parent Alliance Boots, which controls an extensive European pharmaceutical wholesaling business as well as the well-known British pharmacy chain, reported trading profits of almost £1.1bn, on total sales of £22.5bn. Only Tesco and Marks & Spencer have previously broken the £1m barrier. The main Boots retail chain contributed only around a third of revenues, but more than 70% of profits. There were also sound but not spectacular results from supermarket group Sainsbury's and Vodafone. The latter delivered net profits which almost tripled to £8.6bn on sales up 8% at £44.5bn. However, the main factors in that profit leap were reduced impairment charges on past acquisitions and a much lower tax charge. Underlying comparable profit rose by less than 1%.

It looks like performance is back on track at General Motors. The group reported a 1Q surplus of $865m, its first quarterly profit for three years. Revenues jumped 40% from a year ago to $31.5bn, while vehicle production was up by more than half on the same period in 2009.

British soft drinks company Britvic is to take its first steps into France with plans to acquire local juice company Fruité for around €237m. Britvic is the UK's #2 soft drinks company after Coca-Cola, best-known as the local licensee for Pepsi. It also controls a sizeable portfolio of its own drinks including Robinsons, Fruit Shoot and Drench mineral water. Fruité has leading market positions in France in fruit syrups and ambient pure juice with brands including Teisseire and Moulin de Valdonne, Fruité and Pressade. Britvic said it will use its newly acquired subsidiary to provide a platform for the French launch of Fruit Shoot.

The wrestling match between British Airways and its cabin crew took another turn on Monday when a court blocked the three-week strike which was due to begin the following day. That decision was itself controversial, based on a comparatively minor technicality in the complex rules regarding industrial action. The Unite union launched an appeal to challenge the injunction, and this appeal has today been upheld, meaning the strike will now go ahead, probably next Tuesday. In the mean time British Airways CEO Willie Walsh tried a new tack in a public letter published in the Times, directing the focus of his criticism not at the Unite union as a whole, but on its Bassa sub-division, which represents cabin crew at British airlines. This, he said, is run by a group of militant hardliners who "talk openly of a long 'guerrilla campaign' designed to undermine customers' faith in British Airways and inflict as much commercial damage as possible.... They positively relish the prospect of a prolonged attack on the customers and business that provide their members with well-rewarded jobs, generous pensions and enviable lifestyles. And they have no concern for the possible consequences of their campaign for thousands of members of Unite and other trade unionists employed in different parts of BA."

Brenda Barnes, chairman & CEO of Sara Lee, has taken immediate leave of absence for medical reasons. The move is, it is hoped, only temporary. In the mean time, EVP & CFO Marcel Smits takes over as interim CEO, with non-executive director James Crown as chairman. They are joined by CJ Fraleigh, currently head of North American retail, in a three-man office of the chairman which will supervise the smooth running of the business until Barnes returns.

The continuing success of Apple's iPad device has encouraged both HP and Blackberry to confirm plans for their own launches into the tablet sector. HP's device, codenamed Hurricane, will be based on a platform originated by Palm, the PDQ pioneer it has just acquired, and could be out as soon as 3Q. Blackberry's device is being readied for December.


In the news this past week: Agencies

General Motors' newly appointed marketing chief Joel Ewanick has started with a bang. According to the US trade press, he is currently negotiating to cancel the transfer of creative for Chevrolet to Publicis, a decision signed off by his predecessor last month. Instead he plans to tap Goodby Silverstein, with whom he has worked at previous employers Hyundai and Porsche. In addition, longtime Chevy shop Campbell-Ewald is to be given back responsibility for retail marketing and sponsorship. It's not clear at this point where exactly this leaves Publicis US, whose CEO Susan Giannino told Adweek "We are continuing to pick up work on Chevrolet and to work diligently through the transition, both with the Chevy client and Campbell-Ewald. We have not been told anything other than we have the business, and we have been working hard and in good faith to get the work done in the highest quality." According to trade press reports, negotiations with all three agencies are continuing, with confirmation of who gets what expected within the next couple of days. This switcharound is likely to be striking fear into the hearts of other newly appointed GM agencies, whose assignments could also be subject to change.

Isobar, the digital network owned by Aegis, is restructuring its widely spread global network, applying a uniform global identity across what have until now remained separately branded local offices. As a result, core units Glue London in the UK and AgenciasClick in Brazil will adopt the names Glue Isobar and AgenciaClick Isobar respectively. Local names may be phased out altogether other markets. At the same time, Aegis has appointed an expanded central management team to work under Isobar worldwide CEO Mark Cranmer. Glue London's Mark Cridge was appointed at global managing director; AgenciaClick's Pedro Cabral becomes global chairman. Jean Lin was named as chief strategy officer; Niku Banai as chief innovation officer. Separately Aegis reported trading results for 1Q. Reported revenues were up a little under 1%. Organic revenues for the Aegis Media division, however, rose by 3% although that rise was offset by a 2% organic decline for research subsidiary Synovate, resulting in net organic growth of 1%.

Deutsche Bank analyst Matt Chesler gave a strong thumbs up this week to Canadian marketing services group MDC Partners. MDC owns a number of marketing agencies in North America, but is best known as the parent to Crispin Porter & Bogusky, still one of the hottest shops around. Chesler's research said, "Our visit to the impressive Boulder office of Crispin Porter & Bogusky last week reinforces our view that MDC Partners is a powerful play on the shift to digital and is well positioned to out-perform the large cap ad agency peers for the foreseeable future. We feel very comfortable that CP+B will continue to be the engine of growth for MDCA.... Business momentum is accelerating from existing clients and the new business pipeline is strong, the agency is investing aggressively on talent across its footprint with revenue soon to follow, and the agency is scaling up its digital production capability.... And importantly CP+B is achieving this growth without sacrificing its high quality and vibrant culture. At this pace, we would not be surprised if CP+B finished 2010 break-even or better on organic growth despite the $30m+ revenue hole from [the loss of] VW. In our opinion, if investors had concerns about lost momentum at CP+B in the wake of client losses and management transition, this should be less of an issue now." Separately, industry rumours flag CP+B as the favourite to pick up the Mazda auto account, out of Doner.

Ogilvy Group appointed Paul Heath, currently CEO Ogilvy Asia Pacific, to a newly created position as worldwide director of Ogilvy & Mather Advertising. He will retain his Asia role, but also take responsibility for development of the group's global advertising operations. In the US, Cramer-Krasselt, one of the country's biggest independent agencies appointed Anne Bologna as head of its New York office. She was previously one of the two founders of NY boutique agency Toy, which shuttered earlier this year. British-born Mark Cadman was named as CEO of Publicis Seattle, replacing Randy Browning who left earlier this year. Former TBWA UK president Tim Lindsay has joined marketing services group Media Square as non-executive director. Media Square's subsidiaries include corporate communications specialist The Gate and direct marketer CMW. It recently acquire creative agency CST.

Kraft named PHD as the winner of the consolidated UK media account for the Kraft and Cadbury portfolios. PHD previously handled Cadbury; Kraft's incumbent was Starcom MediaVest. Meanwhile, in the US, Mars announced plans to shift its entire media budget from current agency MediaVest to sister shop Starcom USA. The two units operate separately. That decision was a reaction to last week's move by Kraft to consolidate its US media with Kraft One Team, a MediaVest/Digitas joint venture, creating a client conflict. Mars is shifting media buying for its Wrigley candy division immediately. Media duties for the rest of the Mars portfolio will follow later in the year. Taking a little of the shine off its Kraft win, PHD was put on notice by another client, Gap, who have called a global review of media. Separately PHD announced plans to open a New York office of Drum, its UK-based branded content and sponsorship unit.

Sighs of relief at McCann Erickson following the decision by Verizon to leave advertising for its Fios broadband TV service at the agency following a review. The main core of Verizon's mobile advertising was transferred out to McGarryBowen last month. In other account assignments, Sanofi-Aventis called a global review of media, held in most markets by ZenithOptimedia. In the US, restaurant chain Red Lobster called a review of creative and media out of Richards Group. Coca-Cola placed creative for Nestea iced tea with LA-based indie Zambezi. Travel portal Orbitz called a review of media out Mullen, citing a conflict with the latter's newly won JetBlue Airways. In the UK, Associated Newspapers consolidated advertising for the Daily Mail and Mail on Sunday with M&C Saatchi, dropping Bartle Bogle Hegarty. For all other appointments, subscribers can access the full Adbrands Account Assignments database here


In the news this past week: Media

Yahoo is boosting its inhouse content offering through the purchase of Associated Content, an online news and entertainment service which publishes material submitted by an extensive US network of independent, often non-professional freelancers. It claims to manage a pool of 380,000 contributors nationally. In effect, AC is a sort of journalistic Wikipedia, in which ordinary web users are able to submit editorial or video content of their own choosing. The best articles are made available for syndication, with contributors paid according to how many times their pieces are viewed. Yahoo has until now tended to generate the majority of its editorial content from third-party sources such as newswires. By acquiring AC, it will bring inhouse a large pool of eager new contributors, keen to supply material at what are likely to be lower-than-newswire rates. The deal will also heighten the rivalry between Yahoo and AOL, which is also now positioned primarily as a content service. Ironically, AOL's CEO Tim Armstrong is an investor in Associated Content, and attempted to acquire the business last year. That deal was blocked by then-parent Time Warner. Instead AOL launched its own inhouse resource, Seed.

Next month sees the UK launch of Eulogy, a new magazine which claims to be the "world's first magazine celebrating life and coping with loss". It is co-founded by Jim Thornton, creative director at Naked. The monthly is designed as a guide for people who are coming to terms with the death of a family member. The idea came to Thornton following the tragic death of both his wife's parents in two separate car accidents in the space of little more than a year: "My wife and I were left to deal with a lot of stuff with nowhere really to go for information, while in an infinitely complicated emotional state." The title is published by Golconda Media, and edited by Alfred Tong.

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Simon Tesler
Publisher, Adbrands