BIZARRE SCANDAL HITS SAATCHI IN TURKEY: AGENCY ALLEGES FALSE NEWSPAPER STORY SPARKED FIRING

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[istanbul] The district attorney's office here is investigating allegations made by a local Saatchi & Saatchi executive that a national newspaper used threats to get the agency to place more ads in the daily.

The executive said the paper threatened to write a negative story about one of the agency's clients. He said the agency refused to comply, and, in a truly byzantine twist, the negative story ran and the client allegedly fired Saatchi because of it.

The unfolding scandal has been widely covered by Turkish media. The Turkish Advertising Agencies Association, the Advertisers Association and the Turkey Chapter of the International Advertising Association made a joint declaration condemning the developments and emphasizing the importance of freedom of commercial speech.

DAIRY MARKETER SLAMMED

The saga became public Oct. 3 when the Star, a national daily launched in March, published a front-page story under the headline "Scandal." The story claimed Sutas, one of Turkey's biggest milk and dairy products marketers, had sold products found to contain animal feces and mildew.

The next day, Sutas ran page ads in the Star and all the major dailies, calling the Star story false and misleading.

Rival Hurriyet on Oct. 5 broke the story of the attempted "blackmail." The Page 1 article quoted Yigit Sardan, co-partner and managing director of the Saatchi & Saatchi office here, who charged Star exec- utives had tried to blackmail the agency for more advertising.

The attempt allegedly occurred in the last half of September; Saatchi lost the account late that month.

Mr. Sardan did not respond to requests for an interview. Mithat Topac, a Star executive with responsibilities for advertising and marketing, also refused repeated requests for an interview.

At Sutas, Marketing Director Tanju Ipek and Public Relations Manager Neslihan Kokes declined comment on the scandal.

However, Mr. Sardan's allegations were heard during an Oct. 5 evening news broadcast on national TV channel ATV.

Mr. Sardan said: "When we heard that Star was planning a negative story about Sutas, we realized that Star executives thought I was one of Sutas' [investors]. We sent messages to Star that I was not. We initially thought we convinced Star, but this time they told Sutas to fire [Saatchi]. Sutas understandably got scared and fired us."

The Star initially decided to drop the story, but published it later in retaliation over an argument about payments, he said.

After the story was published, according to Mr. Sardan, executives from Star later called him and said they were not accepting advertising from Saatchi for any of its clients.

"They said unless we pay all our outstanding debt, they were not accepting any ads from our group. But Star owed us more than we owed to them. So we said we were not giving in. We called all our clients, explained what happened and told them their advertising was not published in Star or aired on any Star Group's TV channels."

It is unclear for what Star owed Saatchi money.

Star belongs to the Uzan Group, one of Turkey's largest conglomerates and owner of three TV stations.

The chief district attorney's office in the Kucukcekmece district of Istanbul confirmed that an initial inquiry into the various allegations.

Although Sutas declined to comment, its ads claim the Star's original contamination story was false. The food industry's most respected business body -- Turkish Milk, Meat & Food Industrialists & Manufacturers Association -- has also weighed into the controversy, calling the Star's Oct. 3 story false and misleading.

"While it is a fact that industrially produced milk after very strict quality control is always hygienically at its best, we are strongly condemning the unfortunate story, which tries to mislead the public," a spokesperson said.

'STAR'S' STRATEGY

Mr. Sardan alleged in the TV interview that Star was trying to increase its ad revenue to compensate for a drop in circulation income.

On Sept. 5 the Star cut its price from 29 cents to 11 cents. Star says the price strategy has paid off, with daily circulation increasing from 400,000 to 1 million.

But Turkey's Fair Competition Council also announced last week it has launched a pre-investigation into Star's 60% price cut. That came after one of the oldest Turkish dailies, Cumhuriyet, published an open petition to the council that

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