Novartis to Launch Media Review on $600 Million Account

RFP Has Yet to Go out, but Review Is Imminent

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Drug giant Novartis will soon launch a global review of the media portion of its more than $600 million advertising account, several industry executives have indicated to Ad Age.

The primary incumbent on the business is WPP's MEC. The shop has long handled media-planning and -buying duties in various countries around the world. In the summer of 2008, Novartis effectively consolidated its media account at MEC, shifting the U.S. portion of the business to MEC from WPP sibling Mindshare.

MEC referred a request for comment to Novartis, which denied that a review is under way. "We regularly evaluate suppliers, but have made no decision to pitch our media agency relationship at this time," a spokeswoman said in a email. Several industry executives, however, insisted a review is imminent and that a request for proposals will be circulated to media agency networks shortly.

What will be interesting to watch in this pitch is how holding companies and their media shops -- which surely will want a crack at the sizable global account -- will find a way to participate. The pharmaceutical category is rife with conflict issues, and many media shops already handle duties for Novartis' competitors, including GlaxoSmithKline, Pfizer, Eli Lilly and Johnson & Johnson.

There's been increased attention exhibited by pharma marketers with regards to their media agency rosters; GSK awarded U.S. media duties to Omnicom Group's PHD just a few months ago, and that same month Aegis' Carat kept the $1.2 billion Pfizer account after a review.

According to Ad Age's DataCenter, Novartis is among the 100 largest advertisers in the world, with worldwide measured media spending alone coming in at more than $560 million. Total spending is estimated to be much larger. The Basel, Switzerland-based company spends the bulk of that sum in the U.S. and in Europe, with just small slices devoted to marketing in Asia and in Latin America.

The most recent category data Ad Age has shows that Novartis tends to spend less on advertising as a percent of sales than its rivals. In 2009, it devoted 3.6% of its sales to advertising compared to AstraZeneca's 5.1%, Eli Lilly's 6.1%, Bayer's 6.3% and GSK's 8.7%.

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