Coca-Cola is expected to award Diet Coke, Powerade and some other assignments to Interpublic agencies, making up for the shift of the $83 million Sprite account from Interpublic's Lowe Lintas & Partners, New York, to WPP's Ogilvy & Mather Worldwide, New York (AA, Sept. 24). As reported, Ogilvy also is picking up Fanta from Cliff Freeman & Partners, New York.
The shifts follow the loss of more than $350 million in business that PepsiCo last month yanked from Interpublic, closely aligned with Coca-Cola, and awarded to Omnicom Group, closely aligned with PepsiCo.
At the same time, Coca-Cola is moving closer to WPP should Interpublic fail to boost the fortunes of the company's flagship brand, according to agency executives close to Coca-Cola.
Coca-Cola was expected to announce its agency moves late last week, though that was postponed. A spokesman declined to comment. But the estimated $25 million Diet Coke brand is seen moving to Lowe Lintas from Wieden & Kennedy, Portland, Ore.
Wieden also lost the $32 million Powerade sports drink, expected to go to Interpublic's Foote, Cone & Belding, Chicago, which last month lost rival $84 million Gatorade when PepsiCo moved business from Interpublic to Omnicom.
Bcom3 Group's Leo Burnett USA, Chicago, has been relieved of the $38 million Minute Maid account as well as the Coca-Cola Classic seasonal promotions assignments. Bcom3's D'Arcy Masius Benton & Bowles, St. Louis, lost Coca-Cola's Nascar promotion work. Bcom3's Coca-Cola work is expected to disappear into McCann. It's uncertain where Minute Maid will land.
The status of Cliff Freeman & Partners' Cherry Coke assignment is not clear.
Coca-Cola's moves have been orchestrated by Steven J. Heyer, president-CEO of its new business ventures unit. Mr. Heyer has ties to WPP Group Chief Executive Martin Sorrell, who named him to WPP's board in May 2000. Mr. Heyer, a former president of what is now WPP-owned Y&R Advertising, joined Coca-Cola in March with the charge to shake things up. "He's very aggressive. He's making a lot of changes," an agency executive said.
SOMEWHERE TO MOVE
"The opinion now is that if Interpublic doesn't shape up with [flagship brand] Coke and if Coke doesn't turn around, [the company] has somewhere to move Coke-another big agency [network]," said one agency executive familiar with the marketer.
Interpublic's McCann-Erickson Worldwide has worked with Coca-Cola since 1942, and Interpublic is global "creative consultant" on the flagship soda.
WPP "is a viable alternative [to Interpublic]. Suffice to say that in the next six months, if IPG is less effective than it has been, it is threatened," a second executive said. "WPP makes sense. They bought the big brands. Ogilvy can perform for clients under pressure. [WPP's J. Walter] Thompson is not fixed but is getting better. Y&R, it will take some time to fix."
WPP works on some rival brands. Y&R, New York, handles Cadbury Schweppes' Dr Pepper/Seven Up, but the Plano, Texas, marketer said it did not mind sharing WPP with the world's largest soft drink marketer, adding the holding company could keep the accounts separate. JWT works on Pepsi in Asia and on a tea joint venture between Pepsi and Unilever's Lipton in the U.S.
WPP's PepsiCo work could pose a conflict given the intense rivalry of Coca-Cola and PepsiCo. If the PepsiCo business moves, it likely would go to Omnicom, which through its holdings has worked with Pepsi-Cola for more than 40 years.
It's not just brands that are moving about. FCB had been the Gatorade, Aquafina and Tropicana agency, and Chicago office President Brian Williams and others working on Gatorade are expected to migrate to Omnicom. Mr. Williams resigned last week. His replacement is Dana Anderson.
The full PepsiCo breakdown hasn't been decided, but Gatorade, Quaker Oats and Tropicana are expected to be aligned with Omnicom's DDB, Chicago, and a company to be created. It's uncertain where within Omnicom Aquafina will go.
A spokeswoman at Bcom3's MediaVest said Coca-Cola executives have told the agency the realignment would not affect media planning. MediaVest does media planning for Coca-Cola in the U.S. and handles some brands overseas. Interpublic's Universal McCann does buying.
The move leaves New York's Berlin, Cameron & Partners, which handles Dasani, Pibb, Nestea Cool and Mello Yello, as the only independent shop on Coca-Cola's ever-thinner U.S. roster.
Contributing: Alice Z. Cuneo, Richard Linnett, Kate MacArthur, Rich Thomaselli and Stephanie Thompson