Says It Will Pick Agency By August

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CHICAGO (AdAge.com) -- Midas is launching an agency review for its U.S. strategic and creative account after terminating its relationship with its agency, Havas Advertising's Euro RSCG McConnaughy
Tatham, Chicago, a spokesman for the automotive marketer said.

"We are inviting a small number of agencies for that review, which we expect to have complete by the end of August," he said, adding that the company formally notified the agency May 31 that it was not invited to participate in the review. The marketer then informed its dealers and employees on June 1 that it would conduct the review immediately.

Agency claims franchise strife
Executives close to the agency said McConnaughy Tatham resigned the account this morning, citing declining compensation, and franchisee and management strife.

While the automotive retailer in 2000 had planned to spend some $60 million on advertising, actual media spending was $49.5 million, according to Taylor Nelson Sofres' CMR.

Aegis Group's Carat, New York, handles media.

As for the franchisee fracas, the Midas spokesman cited the company's 3% increase in same-store sales as evidence that the company and the dealers are working together.

'New agency, new ideas'
"We've expanded our services and upgraded the appearance of our stores and are working with franchiseees to make that happen," he said. "And we feel a new agency with new ideas will take that to the next level."

Some observers believe WPP Group's Ogilvy & Mather, Toronto, which has handled Midas in Canada for 13 years, could be a contender for the U.S. account, although the spokesman declined to name potential contenders.

Despite the increase in sales for stores open at least one year, Midas' net income for first quarter 2001 fell to $3.2 million, down 42% from $7.5 million in the same earlier-year period.

McConnaughy Tatham is Midas' third agency in six years. It won the account in December 1998 after a review that included the resignation of incumbent True North Communications' FCB Chicago. In July 1995, Midas ended its 25-year relationship with Wells Rich Greene BDDP. WPP Group's J. Walter Thompson, Chicago, resigned the account in June 1997, citing a potential conflict with a client, the Ford Motor Co.