Omnicom Group-owned Arnell now becomes first-stop agency for the client's raft of chocolate, non-chocolate candy, packaged-foods and pet-food brands.
"Arnell will handle front-end work, which means they will be involved in defining the product proposition and helping to determine how to communicate that in an innovative way," said Bob Gamgort, VP-general manager, chocolate, Masterfoods. "We're serious about innovating at a higher rate and getting into new business areas, and this is marketing R&D at its core."
Arnell will work closely with Masterfoods' current roster shops-Grey Global Group's Grey Worldwide, Bcom3 Group's D'Arcy Masius Benton & Bowles and Omnicom's BBDO Worldwide-to aid with research and development, brand positioning, naming and package design, among other services. Arnell's involvement as communications strategist could also involve media planning currently handled by various Masterfoods shops.
Masterfoods has signed a one-year contract with Arnell, and is paying the shop an undisclosed retainer to "basically book the organization's time," according to Mr. Gamgort. Masterfoods, which comprises the formerly separate M&M/Mars, Uncle Ben's and Mars Pet Food divisions, spent $289 million on measured media in 2000, according to Taylor Nelson Sofres' CMR.
In the past, the Mars divisions developed new-product ideas and designs through a mixture of internal resources and a handful of agencies working on a project basis and, Mr. Gamgort said, "the results were not always integrated." Now, in keeping with its ongoing efforts to broaden beyond TV media buys to more integrated communication efforts to reach its mainly teen and young-adult target, Masterfoods has tapped Arnell as a single resource.
"There is quite a bit of time between an idea and when you write the creative brief," Mr. Gamgort said, "and the better job done on that upfront piece, the more effective the creative strategy is going to be." Arnell's ideas will be executed by roster agencies and in some cases, Arnell itself. As a result, Mr. Gamgort said, "[the other agencies] see Arnell as complementary vs. competitive."
While Larson Stiegemeyer, account director for D'Arcy, St. Louis, said the deal "seems like it will be a good match for the ad agencies," he added that it requires a balance. "We've not done new-product work per se, but we bring a depth of knowledge to the brands that's useful at those early stages."
"Peter is an incredibly innovative thinker and he's incredibly good at doing stuff that other people don't do or can't do," said Andrew Robertson, CEO, BBDO Worldwide, New York, which handles M&Ms and Snickers, among other Masterfoods products. "What he does dovetails very neatly with what we do. Our entire Mars team is engaged with him, but his real link is directly into Mars."
Although Arnell has more of a direct link with BBDO because of its shared parent, Mr. Gamgort said, the agency will work closely with the other non-Omnicom agencies. For example, Arnell is working with Grey on an entertainment idea, helping the agency take music campaigns targeted to teens "to a higher level," Mr. Gamgort said.
Masterfoods chose Arnell, a small shop based in New York City's SoHo, especially because of the agency's experience with non-packaged goods industries, in order to gain a fresh approach on how to build existing brands. The company was also drawn by Arnell's ability to concoct "further-out stuff that puts us in a very different place," Mr. Gamgort said.
Peter Arnell, president-CEO, Arnell Group, said his approach is to bring fresh thinking. "Let's try to formulate something that's never been done before from a creativity and innovation standpoint. That describes the whole Masterfoods play," he said.
Although the contract was just recently signed, Arnell has already completed two projects for Masterfoods, which will roll out in 2002, Mr. Gamgort said. He declined to give further details. A logo created by the shop for the new Masterfoods name has already made its debut.
Arnell specializes in what its top executive calls "ideation" and "experiential" marketing, using several small sub-units, including a multicultural group called PASS, run by Mr. Arnell and Steve Stoute, the head of black music at Universal Music Group's Interscope Records.
Arnell was appointed to a similar development-agency position on DaimlerChrysler's Chrysler Group auto account for which the shop, through PASS, created a Dodge promotion featuring Aerosmith. In its dealings with Chrysler, the Arnell Group made the connection with Aerosmith, and then Omnicom's PentaMark was instructed to integrate the band into Dodge's campaign. Chrysler subsequently sponsored the band's recent tour.
Separately, Arnell has been assisting Omnicom's media agency PhD in its quest for the $500 million Sony Corp. media business.
Mr. Arnell's approach to advertising often produces unexpected results. Mr. Gamgort recalled an early meeting in which Mr. Arnell engaged in bit of creative "product demonstration."
"We were talking about how people eat things," Mr. Arnell explained, "and at that moment I was trying to define it: There's the guy who eats M&M's one at a time, and then there's the guy who does this," he said, before pouring the contents of an entire M&M's bag into his mouth.
"He was trying to prove a point and poured it right in there," Mr. Gamgort said. "We were afraid we were going to have to go over there and give him a Heimlich." Instead, they gave him the business.