Bayer Launches Review for $1 Billion Global Account

Seeks to Consolidate Business With One Holding Company

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NEW YORK (AdAge.com) -- German pharmaceutical giant Bayer AG has begun a holding-company review as it pursues a global consolidation of its more than $1 billion advertising account, according to several executives familiar with the matter.

Bayer

The consolidation -- one of many launched by mega-marketers during this recession, in a drive to find efficiencies and cut costs -- will include roster shops that work on Bayer's various brands.

Creative and media duties are spread across a number of entities, among them Omnicom Group's BBDO, which handles advertising for brands such as Aleve and One A Day; WPP's JWT, which handles creative for a number of consumer brands, including indigestion drug Rennie; and Interpublic Group of Cos.' Initiative, which handles media planning and buying for the Bayer Consumer Healthcare subsidiary.

Initial meetings are already under way, but an official response to a request for proposals isn't due till later this summer, so the process likely will take several months. Agency and holding-company representatives either could not be immediately reached or referred calls for comment to Bayer, which did not respond by press time.

Bayer, which was ranked 47th on Ad Age's list of top 100 national advertisers last month, has a massive ad budget that has remained relatively flat amidst the economic downturn, according to Ad Age data and TNS Media Intelligence figures.

In the U.S. alone, the company spent $442 million to market its products in 2008, down slightly from $459 million in 2007, according to TNS. Unmeasured U.S. media, meanwhile, is estimated at $387 million for 2008, bringing total U.S. spending to $840 million last year. That figure, only a 2% drop-off from 2007, represents about 7% of the company's total sales, according to Ad Age data. Globally, the company is estimated to spend more than $1 billion on advertising.

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