Kraft Awards Taxi Its 'Biggest New Product Investment in a Decade'

Marketer Looks to Mio Enhanced-Water Brand to Revolutionize Water Drinking

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Kraft has awarded Mio, a first-of -a-kind liquid-water enhancer that the company has said represents its "biggest investment on a new business in the last decade," to WPP's Taxi, according to people familiar with the matter, just a few months after Dentsu's McGarryBowen created advertising to launch the product.

Other agencies believed to be involved in the review include Interpublic Group of Cos.' DraftFCB and indie shop Cramer-Krasselt. Kraft's media agency, Publicis Groupe 's Media Vest USA, was not affected.

Kraft said in a statement to Ad Age : "We are very pleased with the work that McGarryBowen provided to help launch this new brand. Mio is doing great -- exceeding our initial expectations -- and we are inspired by what lies ahead. As the brand continues to grow, we are growing with it, taking it to new places that are, as of yet, uncharted. We believe Taxi is the right partner for the next leg of this journey."

One person familiar with the matter said McGarryBowen chose to part ways with the account. McGarryBowen and Taxi declined to comment, referring calls to the client.

The Mio assignment gives Taxi, an agency acquired by WPP in November now housed in the Young & Rubicam Brands unit, a place on the Kraft roster. (Ad Age reported yesterday that Taxi and Y&R had won most of Revlon's global business.) Other WPP shops in the Kraft stable include Ogilvy & Mather, which works on Capri Sun, Country Time , Kool-Aid and Tang; Blast Radius, which handles digital marketing on Crystal Light; and Hispanic agency Bravo Group.

Kraft in the last two years has made significant agency-roster changes, shifts that benefited McGarryBowen. In 2010 the Dentsu shop added Chips Ahoy, Fig Newtons and Nabisco 100 Calorie Packs -- brands previously at DraftFCB -- to its existing Kraft roster, which includes 2009 wins Lunchables, also previously at DraftFCB; Kraft Singles and Philadelphia Cream Cheese, both formerly at Nitro; and Oscar Mayer, Crystal Light and Maxwell House, all formerly at WPP's Ogilvy & Mather. MDC's CP&B last year had won Milka, which came from Ogilvy & Mather; and Macaroni & Cheese and Jell-O, which were at DraftFCB. Indie agency Droga5 made its way onto the Kraft roster in 2010 with Athenos, a brand that previously had no agency of record.

Though DraftFCB's Kraft assignments have dwindled, it remains the global agency for one of the marketer's biggest brands, Oreo, as well as Club Social crackers and Kraft cheese. Still in review are the A-1 Steak Sauce and Bull's Eye barbecue sauce brand, both of which have been handled by DraftFCB.

Kraft executives have pledged to make a major investment in Mio, the food giant's first new brand in 15 years. "We believe Mio represents the future of how people will drink that water," Tony Vernon, exec VP-Kraft Foods North America, told analysts in February. "We are backing this initiative with the biggest investment Kraft has made on a new business in the last decade."

During an earnings call in May, CEO Irene Rosenfeld said Kraft has "high hopes" for Mio. "People are just beginning to get it in their hands," she said, adding, "we're just getting started."

Jeff Cioletti, editor in chief of Beverage World, said it's too early to gauge the success of Mio. Kraft, he said, looks to be trying to seize on the rising popularity of enhanced-water offerings such as Coca-Cola's VitaminWater. "People want more out of their beverages in general but specifically they want their water to do more. And that 's sort of what Kraft is banking on with this," he said. By offering it as a liquid additive, Kraft could also be following the trend of more consumers choosing tap water over bottled water as they deal with economic hardships, he said.

Mio, which launched at the end of March, retails at $3.99 per 1.62 fluid ounce bottle -- enough for 24 servings -- and comes in six sugar-free flavors such as berry pomegranate and mango peach. Kraft in March alone spent $3.4 million on marketing Mio, or about 4.1% of its total domestic measured-media budget for the month, according to Kantar. Kraft in 2010 spent a total $833.1 million.

With a tagline of "Make It Yours," TV ads currently running feature close-ups of the brightly colored flavors squeezed into glasses of water while the song "That's the Way (I Like It)" plays in the background.