ANA ad forum: Marketers express concern

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Agency and media-company consolidation might not bring the hoped-for results, a top marketing executive suggested during a panel at last week's Association of National Advertisers' 2002 TV ad forum in New York.

David Cowan, director-U.S. media and programming for Procter & Gamble Co., said he is concerned acquisitions have left 80% of P&G's business at what will soon be a merged Publicis-Bcom3 Group. Mr. Cowan said, as a marketer, he is worried about fewer choices with so few controlling so much of the ad business.

"We have acknowledged that's a concern," he said.

Referring to the media behemoths produced via acquisitions, he said: "On the supplier side, AOL Time Warner is proving to a lot of people it's difficult to realize the synergies of size."

An AOL Time Warner spokeswoman said, "Since the merger, we've begun to capitalize on synergies both internally and with our advertisers, and we'll continue to do so."

CONFLICTS

Consolidation on the media agency side is a thorny issue because marketers can realize discounts if agencies handle more volume. On the flip side, Mr. Cowan said, the trend brings potentially troublesome client -a point refuted by Bill Cella, chairman of Interpublic Group of Cos.' Magna Global USA, and Steve Grubbs, CEO of Omnicom Group's PHD North America.

"There's no betrayal of confidential information," Mr. Grubbs said. Mr. Cella added: "There's a lot of confidentiality in agencies. Walls exist."

Magna was set up as a price negotiator for Interpublic clients from a range of shops, but is not involved in planning or providing clients with more favorable opportunities than others. "We're Switzerland," Mr. Cella said.

Magna does have a unit, however, that is involved in developing advertiser-friendly content. Last week, it was announced Magna and TNT will co-develop movies for the cable network and with Magna client Johnson & Johnson as the title sponsor.

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