Adbrands Weekly Update 25th November 2010
A weekly round up of key news about 
leading advertisers, agencies and mediaowners
 
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Come and see us on Facebook! You don't have to wait until Thursday for our Ads of the Week. We now post all our favourite ads, not just the top four, on Facebook on a daily basis, as well as a selection of interesting news stories from other media. Come and have a look.

Four of our favourite ads this week: 

Stella Artois "Ice Lounge"
by Mother

Aerogard "Summer Lovin'"
by Euro RSCG Australia

Tommy Hilfiger "Feast Interruptus"
by Laird & Partners

McDonald's "Golden Beacon"
by Leo Burnett London

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

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Happy Thanksgiving to all our American readers. Hopefully you're either settling down to read this at home on Thursday night with a belly full of turkey; or it's Friday morning and you're nursing a glass of water fizzing with two fresh Alka-Selzer tablets before heading off to the shops...

Hmmmm. Quite a few contenders for Ads of the Week this week. We'll pick Mother 's new spot for Stella Artois as our opener, and a reliably entertaining festive treat. It's a cute idea - that piano is truly awesome - but I suspect that Mother are having difficulty finding ways to maintain the retro Gallic tone they introduced when they took on the account. It will be interesting to see how this campaign develops next year. 

Here in the Northern hemisphere, as we wrap up against snow flurries and a bitter winter wind, it's easy to forget that the other half of the world is stripping off for their summer holidays. Here's a great new seasonal ad by Euro RSCG Sydney for Reckitt Benckiser's Aerogard insect spray. A timely reminder that to the Aussies, the word "seasonal" means barbies at the beach not snowballs and mistletoe.

Staying seasonal, let's celebrate Thanksgiving with this well-dressed spot by Laird & Partners for Tommy Hilfiger , that label's first branded TV spot since 2005, as well as its first under the control of apparel group PVH. It's a great spot with two alternate endings. We prefer this one - see the other here.

And finally, another lovely slice-of-life ad from Leo Burnett London for McDonald's . We'd already seen a cut-down version of this spot running on British TV, but this is the full-length 60-second version, which is far superior in our estimation. Heart-warming as always.

Several other ads just missed the final cut, including AMV BBDO 's Containers ad for Heinz Baked Beans , a stunning spot by JWT Sydney which features Manchester United players promoting Smirnoff , a silly ad for Rokk vodka by comedy trio The Lonely Island , DDB New Zealand 's stop-motion campaign for Pascall 's confectionery, Saatchi & Saatchi Malaysia for Tiger Beer and TBWA's Being for Tassimo coffeemakers. Come and see them here on our Facebook page.


In the news this past week: Brands & Advertisers

HP delivered solid results for its most recent financial year, which ended in October. Group revenues rose 10% to $126.0bn, while net earnings gained 14% to $8.8bn. Newly appointed CEO Leo Apotheker, finally making his first public appearance for the company, said "HP proved once again that it is able to execute given its market strengths and technology leadership. I have seen firsthand that we have talented people who are focused on delivering value for our customers. Our market opportunity is vast, and I am confident that we will extend our leadership into the future." The strongest growth in sales came from the enterprise storage & servers division, which reported a 20% jump in revenues, helped along by the acquisition of 3Com last year. However the most important contributor was the personal systems group, which markets computers. Revenues rose by 15% to almost $41bn.

One reason for Leo Apotheker's low profile over his first few weeks as CEO at HP was his desire to avoid being subpoenaed to testify at the court case between his former employer SAP and Oracle. That case revolved around illegal activity by employees of a SAP subsidiary in the US, who routinely hacked into Oracle's server during between 2004 and 2007 and stole confidential customer information. Oracle had gone as far as to hire teams of investigators to track Apotheker down and serve him with a subpoena, which would have resulted in an exceptionally embarrassing start to his new job at HP. No such luck. However that case finally drew to a close this week when the jury punished SAP by awarding Oracle damages of $1.3bn, one of the largest fines ever awarded in an intellectual property case. The dejected SAP plans to appeal against the amount.

Nokia's new CEO Stephen Elop continued to shake-up the challenged Finnish mobile giant, appointing American Jerri DeVardi as global chief marketing officer for its main markets division. Although she most recently ran her own marketing consultancy, she has 25 years of big-brand marketing experience, including four years as SVP, marketing & brand management at Verizon and before that at Citigroup. Nestle's top marketer Petraea Heynike announced plans to retire next April after almost 40 years with the company. She will be replaced as EVP, strategic business units, marketing, sales & Nespresso by Patrice Bula, currently market head for Nestle Greater China. Meanwhile, Ben Jankowski is to join MasterCard early next year as global media director. He was previously global account head for Johnson & Johnson account at OMD. In the UK, Sony Ericsson's top marketer Lennard Hoornik has left the company. His replacement has yet to be named. Post Office marketing director Gary Hockey-Morley has also left his job. He will be replaced by Martin Moran, head of Post Office financial services, on an interim basis.

Private equity group KKR is involved in detailed talks to acquire Del Monte Foods, now a leading marketer of pet snacks as well as canned fruit and vegetables. One of several companies which share rights to the celebrated Del Monte trademark, DMF was originally a unit of RJR Nabisco, the conglomerate famously acquired by KKR in 1989 in a high stakes deal which epitomised that decade's "greed is good" mentality. KKR sold the business soon afterwards, and it later bulked up with the acquisition of a clutch of non-core brands from Heinz. In addition to Del Monte canned products, the company controls brands including Contadina tinned tomatoes, Milkbone and Meow Mix pet foods and College Inn premium soups. 

Upscale US clothing chain J Crew also finalised a private equity buyout. CEO Mickey Drexler agreed a sale to TPG Capital and Leonard Green & Partners that values the business at around $3bn. Drexler is the executive who oversaw the dramatic growth of Gap during the 1990s, but was ousted in 2002 when sales stalled. He has worked a similar magic at J Crew, positioning the brand somewhere between Gap and designer labels such as Ralph Lauren. He has been helped considerably in recent years by the fact that First Lady Michelle Obama and her daughters are big fans of the store's clothing.

In other deals, the French owners of the Yoplait dairy business rejected an early E1.4bn bid from local rival Lactalis, because it wanted to buy 100% of the business. Private equity firm PAI Partners wants to sell its own 50% stake in Yoplait, but the other shareholder, dairy cooperative Sodiaal, wants to stay put. That's likely to complicate negotiations with any potential buyer. Meanwhile, exclusive negotiations with Chinese company Bright Food over the purchase of the UK's United Biscuits have now ended without agreement, prompting joint owners PAI Partners and Blackstone to renew talks with other interested parties, said to include Kraft, Campbell Soup Co and Kellogg.

Also up for sale are the UK petrol retail chains owned by French oil giant Total and Murphy Oil of the US, trading as Murco. Both companies want to concentrate on oil production rather than low-margin downstream retail. The buyer is unlikely to be another oil company. Exxon Mobil - trading as Esso - is also cutting back on retail, and BP is still recovering from its oil slick disaster in the Gulf of Mexico. The outlets are more likely to appeal to one of the supermarket groups, probably in partnership with private equity.

Beer giant SABMiller strengthened its profile in Latin America with the acquisition of Argentina's Isenbeck brewery from Warsteiner of Germany. Previously the group had no direct presence in Argentina, which is dominated by AB InBev's Quilmes business, with around 75% share, and Heineken, with 20%. SABMiller will continue to produce Warsteiner under long-term license, as well as Isenbeck and its own imported brands.  

Meanwhile Danone CEO Franck Riboud sought to dampen rumours of the possible sale of the group's water division to Kirin or another of the Japanese brewing groups. He told the Financial Times: "This is a rumour that comes up every two or three years. What I can say is that we remain committed to the development of our four business lines, which obviously include water." Lead bottled water brand Evian, he added, "is part of Danone's DNA". However Riboud is thought to be looking for better terms on distribution in Japan, currently managed on its behalf by Kirin. Separately, Danone agreed to acquire US frozen yogurt producer YoCream for $103m.

Shares in the UK's dominant high street bank Lloyds took a hit as a result of mounting speculation that the UK Government's newly created Commission on Banking might order a reversal of last year's takeover of HBOS. Those fears were prompted by apparently off-the-cuff comments by one of the commissioners at a public debate. Lloyds and HBOS's Halifax brand now have around 30% share of the UK's personal banking sector, more than twice their nearest rival RBS, which owns NatWest. The Commission has been charged with increasing competition and improving customer service within the sector.

Tomorrow is "Black Friday" in the US retail industry, the day which traditionally kicks off the holiday shopping period, and is generally the single busiest of the whole year as consumers take advantage of the post-Thanksgiving public holiday to load up on presents. This year, as many as 138m Americans are expected to hit stores across the country on that day alone. As a result, many retailers traditionally open before dawn to cater to early risers - this year, all Macy's department stores across the country will be opening for the first time at 4am and are offering more than 200 special Black Friday-only deals. Other stores are staying open through the night, and many more will begin offering "door-buster" special deals online from Thanksgiving morning. That's an attempt to steal the pace from the Monday after Thanksgiving, now known as Cyber Monday, because it's the day on which shoppers retreat to their computers to mop up any remaining gift items. The stakes are considerable, especially online. Last year, according to ComScore figures, shoppers spent $318m online on Thanksgiving, up 10% on the year before, $595m on Black Friday, an increase of 11%, and a further $887m on Cyber Monday, up 5%. And that was in a recession, so everyone is expecting an even more substantial lift this year.


In the news this past week: Agencies

Australian ad executive Sean Cummins is to announce full details of a new start-up agency tomorrow, after spending the past year on an extended break from the industry. Cummins is one of the local industry's best-known figures, founder of the creative shop Cummins & Partners, which was absorbed into what is now SapientNitro this time last year. Cummins left the industry on a high-note after his Best Job in the World campaign for Queensland Tourism collected just about every ad award going, including no less than three separate Grand Prix at Cannes. His new venture will be closely watched. In a statement he announced: "On Friday November 26th, I will be announcing a new venture. Whilst it will signal my return to the advertising industry it will be more exciting for the style of business and the calibre of people with whom I will be partnering. It's not about a new advertising agency, it's about what we hope is 'The New Advertising'." In another intriguing development down under, Dentsu has confirmed plans to launch an agency in Australia, possibly as soon as January, to take over advertising of its Yaris small car from Droga5.

Canadian creative boutique Taxi has been acquired by WPP . The business is expected to retain standalone status, working within the Y&R Brands group. Founder Paul Lavoie remains chairman, reporting to Y&R's Peter Stringham, a fellow Canadian. "Taxi is extremely proud of what we have accomplished as an independent over the past 18 years," he said, "including US expansion in 2004 and Europe in 2009. The time is right for a partner as we continue to realize the potential of the Taxi brand around the world." Terms of the deal were not disclosed, but WPP reported revenues of almost C$54m for Taxi for the year to June 2010, and assets of C$25m. 

Creative director Linus Karlsson, whose departure from Mother New York broke last week, is to join McCann Erickson as chairman and chief creative officer for both the New York and London offices. In an unconventional development, especially for a conservative agency like McCann, Karlsson will divide his time between the two cities. His predecessor in new York, Joyce King Thomas, resigned earlier this year, although she has continued to consult over the past few months. The creative department in London has until now been run by ECDs Simon Learman and Brian Fraser. They have resigned; Learman told Campaign: "We do not agree with the new way of working and the impact we feel this will have on the London office." A new local executive creative director will be appointed in the New Year, reporting to Karlsson.

BBDO reached into the heritage vault to find a name for its inhouse brand consultancy, headed in New York by Tracy Lovatt. Batten & Co is a nod to George Batten, founder of the oldest agency in BBDO's family tree as well as the contributor of the first B in its name. The George Batten Company was founded in New York in 1891, eventually merging Barton Durstine & Osborn in 1928. Lovatt's team has already been working with clients such as Hyatt and HBO, but is now being spun out as a distinct unit in its own right, though still under the BBDO umbrella, to encourage interest from customers who aren't already BBDO clients. Its goal is to help clients leverage the value of their brands and use them in other ways. "This was something that existed before we wrapped it up and put a name on it," BBDO's CEO Andrew Robertson told the New York Times. “We had empirical evidence it was providing value for clients, so we thought we'd pack it up and position it specifically to try to develop it further... Rather than knock on the door as BBDO, it's a way to reach advertisers who have [alternative] agency relationships so they don't have to disrupt those relationships." The group's German consultancy arm BBDO Consulting has also adopted the Batten & Co brand.

The Financial Times reported on friction between British PR guru Matthew Freud and Publicis , to whom he sold a 50.1% stake in his Freud Communications business in 2005. FT sources say that Freud has become "frustrated" by the constraints of the Publicis group structure and disappointed by the lack of significant international growth under the present arrangement. An unnamed Publicis source told the FT it remained "completely hands off" with regard to Freud. "The only person he reports to is God," said the source. Freud is understood to be negotiating to buy back the Publicis shares, although for now the two sides disagree widely on a valuation of the company. Freud has a history of getting itchy feet after a sale. Previously he sold his company to AMV in 1994, before buying it back again in 2005.

It's been an uncharacteristically busy week in Germany for account changes. Unlike the US and UK, for example, Germany is a market where most agency-client relationships traditionally last for decades rather than years. Yet this week brought a series of major appointments or reviews. The most startling was McCann Erickson's ousting by local GM subsidiary Opel after more than 80 years. Instead, the carmaker has appointed independent creative powerhouse Scholz & Friends to assume control of the account, not just in Germany, but with oversight over other European markets. McCann's MRM division will keep hold of online for the time being. Also this week, Deutsche Post DHL awarded local media for its two brands to Optimedia, ending a 20-year partnership with Carat. However, Carat keeps the account in the rest of Europe; MEC has other global markets. Rail giant Deutsche Bahn is also reviewing creative and media, currently held by Ogilvy and Mindshare respectively. 

In other account assignments, BlackBerry called a review of global creative, currently managed by Leo Burnett. That network has declined the opportunity to defend, saying it will focus its attention instead on another mobile phone client, Samsung. Also in Canada, BBDO picked up local advertising for Miller beer brands from Molson. Chinese computer giant Lenovo also called a global review. Ogilvy is the incumbent, having stayed with the account following the transfer of the business from IBM in 2005. Panasonic called a review of pan-European creative, shared between Grey's Atletico International and UK indie Brave. 

In the UK, Everything Everywhere, the umbrella for the local operations of Orange and T-Mobile, consolidated media at WPP's Group M. Offline media is unchanged , remaining at MEC (for Orange) and Mediacom (for T-Mobile). However, Mediacom will also take over T-Mobile's digital media, currently handled by Havas's Arena Quantum. Yahoo awarded local advertising to Wieden & Kennedy London, and publisher Random House appointed Beattie McGuinness Bungay. For all appointments, subscribers can access the full Adbrands Account Assignments database here


In the news this past week: Media

Comcast confirmed several changes to the senior management team at NBC Universal. Completion of its takeover is expected any day. Ted Harbert, current president of Comcast Entertainment, is to become chairman of NBC Broadcasting, with responsibility for all programming and ad sales on the main free-to-air network. Robert Greenblatt is joining from Showtime to become president of NBC Entertainment, the unit which develops all non news and sports content, while ad sales will be headed by Marianne Gambelli, who moves up from the #2 spot in that division. Bonnie Hammer becomes chairman of NBCU's cable networks, partnered by Lauren Zalaznick as chairman, NBCU cable digital networks & integrated media, with Dave Cassaro as president of advertising sales.

Time Out founder Tony Elliott has sold a 50% stake in his global listings magazine group to venture capital group Oakley Capital for GBP 10m. A large chunk of the new funding will be used to expand the group's online operations in mainland Europe.

Google moved into mainstream eCommerce for the first time, launching its own online fashion store in the US under the name Boutiques.com.

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Simon Tesler
Publisher, Adbrands