GIANT CALIF. UTILITY PUTS AD ACCOUNT IN REVIEW

Incumbent J. Walter Thompson to Compete for PG&E Work

By Published on .

SAN FRANCISCO (AdAge.com) -- Ending its current relationship with J. Walter Thompson, its agency of five years, California's largest utility, Pacific Gas & Electric, has launched a review of its advertising business.
Now out of bankruptcy, PG&E is reviewing its advertising accounts.

Bankruptcy period
J. Walter Thompson, part of WPP Group, produced PG&E TV campaigns stressing educational and public service themes during a period when the utility was in bankruptcy following the state's disastrous power industry deregulation attempt.

The review is a blow to JWT, which this spring combined its San Francisco and Los Angeles offices into JWT/West and named Mike Mazza executive creative director of JWT West and Brad Fornaciari president. Mr. Mazza came to the shop from Publicis Groupe's Publicis & Hal Riney, San Francisco. Mr. Fornaciari was president of the JWT Los Angeles office.

JWT does plan to defend the account, according to Mr. Fornaciari. He noted that the agency won two one-year extensions of its original three-year contract.

Seeks lead agency
In a preliminary request for proposals, the power generation company said it is seeking a lead agency to handle strategic planning and research, creative development, production, and overall management of advertising, including work done by its African-American, Hispanic and Asian agencies.

The RFP said the contract will not include media planning or media buying. Criteria for participating agencies include a San Francisco/Bay Area location; experience with general market accounts with billings over $20 million; no client conflicts; a demonstrated TV and radio track record; and full-service facilities. Responses are due by Aug. 13.

PG&E last year spent $10.5 million in measured media, down from $12.3 million the year before, according to TNS Media Intelligence/CMR. A PG&E spokesman said new spending could go as high as $20 million. A decision is expected by year's end.

'Periodic review'
PG&E, with 14 million customers in northern and central California, emerged from bankruptcy protection in April. The PG&E spokesman said, however, the RFP was issued not because of a strategy shift, but rather as part of a periodic review to determine whether PG&E is getting the most for its spending.

Mike Worms, an analyst with Harris Nesbitt, said utilities nationwide are facing increased competition as the industry becomes deregulated. However, at this time, it is uncertain how California's deregulation battles will play out. In states where deregulation has taken hold, utilities are engaged in major battles for share, with companies trying to steal from each other, he said.

Other PG&E agencies include BaumanCurry, Oakland, for African-American advertising; The IW Group, San Francisco, for Asian advertising, and Headquarters Advertising, San Francisco for Hispanic. WPP's MindShare remains the media-buying agency, while Mediaedge:cia continues media planning.

Other clients at JWT/West's consolidated office include Symantec as well as regional support on the Ford Motor Co. and Dominos accounts.

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