The marketer sent out requests for proposals last week to all its current agencies. The list includes WPP Group's Y&R Advertising, WPP's Mediaedge:CIA, Interpublic Group of Cos.' McCann-Erickson Worldwide, Omnicom Group's BBDO Worldwide and Grey Global Group's Grey Worldwide, said executives close to the situation. A decision is planned by late May.
ChevronTexaco, tied for fourth place as the world's largest oil concern, did not return calls for comment at press time.
Earlier this year, the client consolidated its North American account at Y&R, San Francisco. As part of the consolidation, Texaco's Havoline motor oil brand moved from incumbent BBDO, Houston. Y&R had handled Chevron's $21 million account, including Chevron gas stations, before the merger. Mediaedge:CIA handles buying for ChevronTexaco. McCann has had the client's $30 million Caltex brand in select Asia-Pacific markets since late 2000. BBDO handles the client in Latin America. Smaller shops have European accounts.
ChevronTexaco reported 2001 net income of $3.29 billion and operating earnings of $6.8 billion, lower than 2000's pro forma results of $7.72 billion in net income and $8.1 billion in operating earnings. In the fourth quarter, the company posted a net loss of $2.52 billion as compared to net income of $2.04 billion during the fourth quarter of 2000.
Chairman-CEO Dave O'Reilly said special charges of $1.9 billion against earnings were taken in the fourth quarter. "We made some difficult decisions on investment properties for the combined asset portfolio following the merger."
Some $1.4 billion went toward write-downs of upstream wells and properties that didn't have as much oil as expected, said Paul Larson, an analyst with Morningstar. About $700 million went to employment termination and other costs related to the merger.
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Mr. Larson, however, projected an improved year for ChevronTexaco, since "most oil mergers have just been up to this point a wild success."
The move mirrors that of its larger competitors. The world's third largest oil group, Royal Dutch/Shell Group of Cos., was first to consolidate its outside-North America account at WPP's J. Walter Thompson Co., London, in late 1998. The U.S. account moved to JWT, Houston, a year later after WPP sibling Ogilvy & Mather, Houston, resigned it to take on the newly consolidated $200 million business of the No. 2 oil marketer, BP PLC. ChevronTexaco is tied for No. 4 with Total Fina Elf.
In summer 2000, ExxonMobil Corp., the world's largest oil company, combined its $100 million global fuel creative at Omnicom's DDB Worldwide in a shootout with McCann. It later consolidated its $100 million global media account with Zenith Optimedia, jointly owned by Publicis Groupe and Cordiant Communications Group.
contributing: lisa sanders