DraftFCB Wins Wal-Mart's $580 Million Ad Account

Carat to Handle Media

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NEW YORK (AdAge.com) -- Wal-Mart Stores is handing its $580 million creative and media-buying account to Interpublic Group of Cos.' DraftFCB and Aegis Group's Carat, according to executives familiar with the situation.
The win is huge for the newly merged DraftFCB.
The win is huge for the newly merged DraftFCB. Credit: AP

The win is a huge coup for DraftFCB, which was only recently merged. Omnicom Group's GSD&M, an incumbent; Interpublic's Martin Agency and WPP Group's Ogilvy & Mather, New York, also vied for the account.

Seismic shift
The decision marks yet another move in Wal-Mart's seismic shift in corporate image and physical presence. The review, managed by Catherine Benison, CEO, Select Resources International in Santa Monica, Calif., and captained on the client side by Wal-Mart's senior VP-marketing, Stephen Quinn, highlights a year of changes as the retailer moves away from a consumer-product-marketing approach to a retail-marketing approach focused on its "store of the community" program.

All but one agency referred calls to Wal-Mart. "Losing sucks, but what are you gonna do?" said GSD&M's founder and president ,Roy Spence. "We had a great ride for 20 years. I got to hang out with Sam Walton and we were part of building the largest retailer in the world. Not bad for kids from Austin."

A Wal-Mart spokeswoman said, "The decision has not been made yet." When asked about a timetable on a decision, she said it is expected by the first week in November. "We've had top-class presentations from top-class agencies and we are still assessing."

Shaking off status quo
As the review progressed through the summer, it became apparent that the status quo would no longer be good enough. Independent Bernstein-Rein had a record of 32 years of ad work for Wal-Mart when it was cut from the review in August. Later that same month, Publicis Groupe's Saatchi & Saatchi, considered a favorite after Saatchi X was named agency of record for shopper, in-store and employee communications, dropped out of the review, having wooed Wal-Mart competitor JC Penney away from Omnicom's DDB.

Wal-Mart's prime challenge, according to its request for proposals, is to get people who visit its stores to shop more broadly, particularly for higher-margin goods. The company is already attempting to move away from the grid-style aisles and go upscale with offerings such as sushi and wine at its laboratory store in Plano, Texas.

Multicultural review to continue
Wal-Mart's multicultural review will continue, with final presentations from four Hispanic agencies and three African-American and three Asian-American shops in November. Wal-Mart is one of the largest accounts in the Hispanic market, spending about $55 million a year through independent agency Lopez Negrete Communications, Houston. The other Hispanic agencies pitching are independent Grupo Gallegos, Long Beach, Calif.; independent LatinWorks, Austin, Texas; and Accentmarketing, Miami, 49%-owned by Interpublic.

The company, which so often has represented Middle America values, has paired with gay-marketing agency Witeck-Combs Communications and has formed a partnership with the National Gay & Lesbian Chamber of Commerce in recent months.

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Brooke Capps contributed to this report.