The parting of the ways comes as Little Caesars Pizza, known as a difficult client which has been cutting spending and commissions, hears pitches from Bozell Worldwide, Southfield, Mich., Fallon McElligott, Minneapolis, and Grey Advertising, New York. Little Caesar Co-Chairman Denise Illitch Lites is running the review. A decision is expected in mid-March.
A PSYCHOLOGICAL BLOW
Although Little Caesars billings reached as much as $75 million during the marketer's 10-year run with Cliff Freeman, the resignation represents more of a psychological than a financial blow. Cliff Freeman was Little Caesars first national agency. The agency launched the brand and its "Pizza! Pizza!" tag, and its Little Caesars work has won awards including multiple Clios and Cannes Lions.
"Although we value our relationship with them [Cliff Freeman] very highly, we felt that it was time to do a review," said a spokeswoman for the pizza chain.
Agency Chairman-Chief Creative Officer Cliff Freeman wouldn't go into detail about the agency's participation level in the review, but said, "The review triggered some real soul searching . . . This has been an extraordinary relationship."
And a troubled one. Besides the drop in spending -- Little Caesars' measured ad spending has dropped from $61 million in 1995 to $35 million through the first 11 months of 1997 -- the agency's commission had been slashed from 15% to 8%.
Executives close to Little Caesars and Cliff Freeman said revolving-door marketing management at Little Caesars helped fray the relationship, and said current staff is often at odds with franchisees.
Some also question whether or not humor -- the hallmark of Freeman's Little Caesars ads -- is enough to sell pizza in the hotly competitive $21 billion category.
"I think this [a review] should have been done a few years back," said Skip King, a Little Caesars franchisee based in Houghton Lake, Mich., who operates six units and is in litigation with the company. "It's not like I have anything against Cliff Freeman. But we should be selling pizza. We're in the food business. We're not in the comedy business."
Little Caesars, a privately held company, does not release sales figures. According to data from NPD Foodservice Information Group, the chain's total dollar sales were down 6.7% last year from a year earlier, while sales for the total category were up 5.5%.
According to the latest figures available from the restaurant consultancy Technomic, Little Caesars posted $1.8 billion in sales for 1996.
BUILDING A BRAND
One former Little Caesars executive, who credits Mr. Freeman for the chain's growth, said the agency built the brand from a small player in a big field.
"He took whatever budget there was a lot farther," he said, adding, "When they [Little Caesars] look in the mirror, they may see that advertising isn't the only problem."
Grey and Bozell both have experience in the pizza category. Grey previously handled Domino's Pizza and resigned that account when a review was called. However, Grey had taken Domino's to record sales levels prior to the review.
Bozell Director of Client Services and Creative Rob Elliott was previously VP-marketing and creative at Little Caesars and has been in close contact with the company since his departure.
FALLON WANTS ACCOUNT
Fallon wants a slice of the pizza category and previously participated in the Domino's review.
Industry speculation is that Cliff Freeman has its sights set on other fast-food accounts, and may have even been approached recently by Wendy's International and Dunkin' Donuts. Cliff Freeman has a prior history with Wendy's; Mr. Freeman created the "Where's the beef?" campaign for Wendy's while at Dancer Fitzgerald Sample, then Wendy's shop.
Denny Lynch, VP-communications, said, however, Wendy's isn't in review and that the company is very happy with its current agency, Bates USA, New York. Dunkin' Donuts couldn't be reached at press time.
Mr. Freeman declined comment about Wendy's, but did say about getting back into the fast-food arena, "Anything is possible. We certainly have a long history in the category."
Contributing: Alice Z. Cuneo, Chuck Ross