Adbrands Weekly Update 28th January 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: 

Bud Light "Clothing Drive"
by DDB Chicago

Barclaycard "Rollercoaster"
by BBH London

Knorr "Neck brace"
by DDB Toronto

Walmart "Clown"
by Publicis & Hal Riney

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May the stars shine down on AB InBev and DDB Chicago for this heart-warming sequel to last year's classic Swear Jar spot for Bud Light. This time the staff at fictional - what? ad agency? - Newton Graham are engaged in a clothing drive. Anyone who donates an item gets a bottle of of Bud Light. Many of the familiar faces from Swear Jar return, bless 'em, and there's another star turn from the "Can I borrow your pen" girl from the last ad. If you missed the original spot, you can see it here on our Budweiser page.

Another sequel: this time for last year's immensely popular Waterslide ad for Barclaycard. This time, BBH London have assembled (mainly inside a computer of course) a vast rollercoaster. Fun. But odd? Why on earth are the girls in the ad all smiling at this guy? Ladies, would you really be smiling at a guy who peeped in through your window while you were shaving your legs in the shower?

DDB Toronto created Salty, a tiny love-lorn salt shaker, to promote the Knorr range of low-sodium sidedishes last year. He proved such a hit with viewers that he has been resurrected in what looks like it could become a whole series. There are two new spots. We had trouble choosing which one to lead with, but the superbly subtle character animation in this one, Neck brace, swung it for us. Don't miss the other spot, Dating, here. Poor little guy.

And finally, a distinctly out-of-character spot for Walmart which first aired last weekend in the NFL play-offs. It's not from main shop The Martin Agency, but by Publicis & Hal Riney, rebuilding its reputation with rather more offbeat creative than the sentimental spots for which it was once famed. Great.


In the news this past week: Brands & Advertisers

Apple unveiled its much anticipated tablet computer, and most of the advance speculation was correct. What no one appears to have predicted, however, was the name. Not iSlate, iTablet, iBook or iPalette, but the far more logical, even obvious, moniker iPad. (The name has inspired much ribaldry in cyberspace, as pundits riffed on the idea of a new Apple product which doubles as a feminine hygiene product: "iPad. Like a tampon. Only more expensive."). As expected the new product is wireless driven, with service provided in the US by AT&T, like iPhone. No international carrier partners have been confirmed yet. Also as expected, it comes with iBooks, new e-reader software that already has five book publishers including Penguin and Harper Collins signed up as partners. However, there are no deals yet with magazine and newspaper publishers, broadcast networks or movie studios. The best news is the price, which starts at just $499, making the 16Gb entry-level iPad very affordable indeed. Most users, however, will want the bells and whistles version at $829, complete with 3G rather than basic wi-fi, and 64Gb of memory. Apple's Steve Jobs called the iPad "magical and revolutionary" but many observers were left underwhelmed, feeling that the device was rather less revolutionary than they had expected, especially after the near-hysterical media speculation that preceded the launch. Several questioned the need for a portable device to fill the gap between the iPhone, which is already doing a truly great job, and traditional laptops.

Toyota's increasingly shaky reputation for quality engineering took another serious blow after the company halted both sales and production of eight models in North America and issue a new recall affecting some 2.3m vehicles, half of them already dealt with under last year's record recall of 4.2m cars and trucks. At the same time that original recall was widened to include another 1.1m vehicles. Then as now the concerns relate to potentially dangerous sudden acceleration in selected Camry, Corolla, RAV4 and Tundra models as well as some Lexus vehicles. In some cases that problem is being caused by floor mats getting wedged under the accelerator pedal; but in around 1.7m vehicles there is also an additional danger that a build-up of condensation in the accelerator mechanism will also cause the pedal to stick. The new recall was prompted by several new acceleration-related accidents, notably the death of four people in Texas late last month. The floor mats had already been removed from their car on the advice of their dealer. Toyota is expected to widen its recall to Europe and other markets by the end of this week or early next. Separately the group reported a 13% fall in worldwide vehicle sales during 2009 to 7.81m units. That was its poorest performance for several years, well below the 9.37m peak it hit in 2007. Toyota forecasts an improvement this year to 8.27m cars and trucks.

Just as the final grains of sand were slipping through Saab's hourglass, GM concluded a deal to sell the business to the specialist Dutch sportscar manufacturer Spyker for E74m in cash. Spyker has negotiated a E400m loan from the European Investment Bank to support the business, underwritten with a guarantee from the Swedish government. Huge sighs of relief all round - assuming the deal is completed, that is. A similar arrangement with another boutique manufacturer Koenigsegg collapsed last year. If all goes well, the company will adopt the new name of Saab Spyker Automobiles. Separately the auto giant confirmed Ed Whitacre as "permanent" CEO as well as chairman. He had taken on the CEO role on an interim basis following the departure of Fritz Henderson last year. The 68-year-old Whitacre also announced that the group was on track to repay almost $10bn of loans made by the US and Canadian governments by June this year, well ahead of a 2015 deadline. This would allow GM to issue an IPO before year's end and cash out part of those two governments' equity stakes.

As expected, President Obama's administration tabled a new plan to reform the financial services sector. Under the proposed scheme, banks that take deposits from customers will be barred from proprietary trading, in other words investing funds for their own benefit as opposed to that of their customers. That would also stop them from owning, investing in or advising hedge funds or private-equity firms. Obama also wants tighter caps on size, to prevent the concentration of too much wealth in individual companies. That approach was supported by many Democrats, but not by Republicans, who accused the government of trying to score popularity points with an increasingly disenchanted public at the expense of big business. Obama was unfazed by such jibes, and vowed, "If the banks want a fight, it's a fight Iím willing to have." That stance didn't go down well with investors in America's big banks, all of whom would be affected in different degrees by such a law. The worst affected would be JPMorganChase, whose business is broadly split between retail financial services and investment banking. Its shares fell by more than 6% after Obama's speech, leading the rest of the sector and then the whole market down, as jitters spread through the investment community. 

US discount retailer Target, the #2 in that sector behind Walmart, announced it would expand its presence into Canada and Latin America by 2015. That would mark its first steps outside the domestic market. However first priority will be to invest as much as $1bn on refurbishment of existing US stores, and then to begin testing a smaller urban retail format to match outlets already introduced by Walmart.

Tesco is moving into the movie business, funding what is likely to be a series of straight-to-video adaptations of bestselling books. The resulting DVDs will be sold exclusively through Tesco stores for a limited period. The grocery giant has already signed a four-book deal with author Jackie Collins. The first release, Paris Connections, is currently in production and is expected to launch in May. Tesco and its film-making partner Amber Productions are also in talks with other authors including children's favourites Jacqueline Wilson and Philip Pullman. Also diversifying this week was mobile phone operator O2 which will boost its recently launched financial services offering with the launch of travel insurance through a partnership with Mondial Assurance.

PepsiCo UK named Amanda Thomson as the new marketing director for beverages, replacing Bruno Gruwez, who has taken up a wider role at PepsiCo Western Europe. Thomson joins from the same role at PepsiCo Australia & New Zealand, where she will be replaced in turn by Lim McConnie. T-Mobile UK named Lynne Ormrod as its first head of brand and advertising. British supermarket group Morrisons named Dalton Philips as its new chief executive, replacing Marc Bolland who is leaving to join M&S. Philips is currently COO at Canadian grocer Loblaw. Aged 41, he will become the youngest head of a FTSE 100 company when he takes up his role at Morrisons, probably in May.

HP launched a subscription music download service in 10 European markets through a partnership with UK-based provider Omnifone. The service will be available in key markets including the UK, France, Germany, Italy and Spain.


In the news this past week: Agencies

AdAge and Adweek handed out their Agency of the Year plaudits for last year. McGarryBowen captured the honours as AdAge's top creative agency as a result of dynamic new business run last year, said to have boosted revenues by as much as 25%. Also making the top ten on AdAge's A-List were Euro RSCG USA for its strong growth in digital; independent Rockfish (also Small Agency of the Year) for developing a range of proprietary software including digital coupons that can be purchased piecemeal by clients; Martin Agency (also the only returnee from the 2008 A-List); DraftFCB for the growing success of its integrated service; digital group AKQA; hispanic shop Alma DDB; digital indie Firstborn; PR giant Weber Shandwick; and creative agency Venables Bell. LatinWorks was named as Multicultural Agency of the Year; OMD as Media Agency. In its International Agency of the Year rundown, Santo Buenos Aires took first place, followed by Sid Lee of Canada, Almap BBDO from Brazil and DDB New Zealand.

However perhaps the most significant accolade handed out by AdAge was that of Comeback Agency of the Year, awarded to Universal McCann for its impressive return from near-death a couple of years ago. In fact, rival trade bible Adweek was so impressed with UM's new business spurt this year that it named the shop US Media Agency of the Year. Account wins included both BMW and Chrysler as well as Schwab, Expedia and Dyson, among others. Also honoured by Adweek were The Martin Agency (US Agency of the Year), JWT (Global Agency of the Year), OMD (Global Media Agency of the Year) and R/GA (Digital Agency of the Year).

Dentsu had further cause for celebration beyond the honours bestowed upon its McGarryBowen subsidiary. It also announced the acquisition of Innovation Interactive, the New York-based group behind digital marketing agency 360i, search marketer Search Ignite and web optimisation specialist Netmining. That group reported revenues of $61m in 2008, and is expected to post sales of around $80m for 2009. Separately, Will Travis was named as CEO of Dentsu America, the group's core creative agency in North America, reporting to Dentsu Holdings USA chairman Tim Andree. In the UK, another digital independent, Grand Union, was reported to be in talks over full or partial acquisition, this time by Fullsix International, the pan-European digital network headquartered in France.

According to Brand Republic, Starcom MediaVest is developing a new worldwide structure whereby the network will be organised into ten global hubs, with territories grouped according to size and maturity rather than geographic location. As a result, the US and UK would be grouped together, as would be all emerging markets, and smaller territories. The structure is being devised by Andrew Swinand, president of global operations. Iain Jacob, currently CEO of the EMEA region, will take on a new role as president, global innovation.

Aegis Media expanded its presence in China by merging its existing Vizeum office there into a joint venture with Charm Communications, one of the country's biggest media buyers and the largest broker for state-owned broadcaster China Central Television. Initially, Aegis will hold 40% of the joint venture, but will gradually take full control of the business, still to be named Vizeum China, through a series of put and call options.

Michael Bray, president of DDB Europe and a company lifer who first joined DDB in 1977 as an account exec, is to retire at the end of March. His replacement will be named in due course.

According to Brand Republic this morning, Vodafone is preparing to call a review of its UK advertising account, currently parked at BBH London. Officially, the company denied any such plans, but BR says that brand director Danielle Crook has held talks with other agencies and is drawing up a shortlist.

In other account assignments, insurance giant Aviva placed global media with ZenithOptimedia. Chrysler named Maxus as its lead media agency in parts of Asia Pacific including Australia. CHI & Partners joined the Nestle UK roster with the capture of the Polo Mints account. Fast-expanding chocolate pudding maker Gu appointed Mother London to manage creative. For all other appointments, subscribers can access the full Adbrands Account Assignments database here


In the news this past week: Media

Not even Google was entirely immune from the slowdown in global advertising during 2009. After several years of double-digit growth (as much as 31% in 2008), Google's group revenues rose just 8% in 2009 to $23.65bn. However net income jumped by 54% to $6.5bn. The previous year's figure was impacted by a $1.1bn writedown in the value of the company's investments in AOL and WiMax ISP Clearwire. Advertising contributed almost 97% of revenues, including $15.7bn from advertising on Google's own webpages, and a further $7.2bn from its network of third-party publishers. Separately Yahoo reported a 10% fall in 2009 revenues to $6.5bn, but a 43% uplift in net income to $598m.

UK broadcaster ITV finally got its chief executive after close to a year of searching. Adam Crozier, currently head of Royal Mail Group and a former chief of the Football Association and Saatchi & Saatchi, will take up the job later this year. That announcement, made today, followed the appointment last week of David Abraham as the new chief executive of Channel 4, replacing Andy Duncan, who left at the end of last year. Abraham is currently head of UKTV, the cable channel joint venture between BBC Worldwide and Virgin Media.

An influential committee from Britain's House of Lords has given its support to proposals to partially privatise BBC Worldwide and create a national champion which would distribute locally produced TV content around the globe. Not just its own programming, but also content from the independent sector. The committee's chairman Lord Fowler said "At a time where there is substantial public concern about British companies being taken over from abroad, there is the opportunity to establish a British-owned global brand. BBC Worldwide has been immensely successful in developing the commercial income of the BBC and now has a revenue of around £1bn a year. All the evidence suggests that there is further scope to expand, but to do this will require private capital. It cannot be achieved by using the licence fee. A company with private investment, but retaining a BBC shareholding, could achieve both bigger profits and also major proceeds from the sale."

The all-party committee also criticised the failure of the government to intervene when competition regulators blocked the creation of "Project Kangaroo", a web-based video-on-demand service which would have been jointly owned by the BBC, ITV and Channel 4. "The blocking of Kangaroo," said Lord Fowler, "has had the self-defeating effect of leaving the market wide open to American competition. We are very concerned at the Government's failure to understand the value of the project to British content producers." Instead, Kangaroo's technology forms the basis of SeeSaw, an independently owned, but very much smaller, service which will launch next month. British TV content will be available free to viewers supported by advertising - Cadbury, Nivea and Sainsbury's have already signed up for the service. However Arqiva it is likely to struggle to match the muscle of American-owned YouTube and Hulu both of which either already have or are planning to launch UK broadcast portals.

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Simon Tesler
Publisher, Adbrands


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