A-B InBev in Talks With Media Shops Over Best Practices

McCann, Starcom Asked to Showcase Case Studies, Capabilities as Top Brewer Mulls Next Steps for Media

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CHICAGO (AdAge.com) -- Anheuser-Busch InBev is huddling with its global media agencies in what the world's No. 1 brewer says is an attempt to create a standard set of practices for media buying across the globe -- but some think it may be a precursor to a large-scale media review.

Credit: Anheuser-Busch InBev
Asked about the agency talks, an A-B InBev spokesman said the company is merely pursuing a "global master services agreement with each agency to create a standard operating procedure for our local markets to negotiate their local deals," and it identified the shops involved in the talks as Interpublic Group of Cos.' Universal McCann and Publicis Groupe's Starcom MediaVest.

Even the slightest change in global media practices by a marketer of A-B InBev's scale is, of course, likely to lead to significant dollar shifts. The company spends more than $1 billion globally each year via its massive media and sports-sponsorship budgets.

Interpublic's stance
But Universal McCann isn't behaving like an agency network that is simply reworking contracts on work it already does. For one thing, parent Interpublic took the unusual step of notifying a major U.S. client -- A-B rival MillerCoors -- about the discussions, and it also informed A-B that it would not participate in any talks concerning work in the U.S., according to a spokesman for Interpublic's MediaBrands unit, which encompasses both Universal McCann and Initiative, which buys media for MillerCoors. The MediaBrands spokesman stressed there was currently not a review running.

And a Universal McCann spokeswoman denied that the agency was involved in any consolidation talks: "We want to make clear that A-B InBev has not contacted us about participating or working on a global media-buying consolidation program," she said in a statement. "We trust this official UM communication will put to rest any rumors or speculation on this matter."

But people familiar with the matter at both UM and Starcom said it was clear that A-B InBev was "conducting an exercise that evaluates the strengths of their agency lineup," asking for examples of global work for a number of clients, and also for samples of digital capabilities.

Both Starcom and UM's work for A-B InBev is limited to non-U.S. markets. UM works with A-B InBev in Argentina, Belgium, Bulgaria, Canada, Croatia, Germany, Hungary, Netherlands and Russia, and Starcom MediaVest handles the U.K., Ireland and Italy.

A-B's U.S. media buying and planning, which has been handled by the brewer's Busch Media Group unit since the early 1990s, has been the subject of intense speculation practically from the moment InBev bought A-B late last year in a deal that left the newly merged company with $52 billion in debt.

In order to manage that load, the company set about cutting $2 billion in costs. And many industry figures speculated that maintaining an internal media agency might prove too pricey in that environment. But A-B execs have repeatedly insisted that Busch Media was -- and should be -- safe, arguing that the bulk discounts the model helps them realize more than offset any added costs associated with running it.

Fate of domestic media arm
Still, speculation about the media arm's future was rekindled last month when the executive in charge of it, Dan McHugh, A-B's VP-media, sponsorship and activation, resigned after less than a year in the post. Of course, even if the talks with UM and Starcom did lead to a consolidation, it could easily be limited to the non-U.S. markets where the agencies currently work for the brewer, leaving Busch Media intact here.

Starcom MediaVest, for its part, has been hurting in the beer category ever since it lost this year's pitch for MillerCoors' consolidated business. (Starcom USA had handled Miller Brewing's media buying and planning throughout its history before losing out in the consolidation.) MediaVest's only U.S. beer account is Heineken USA, but it has handled InBev brands in certain overseas markets for most of its history.

A Starcom MediaVest spokeswoman declined to comment.

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