INTERNATIONAL SPECIAL REPORT;REDEFINING EUROPE;WHETHER IT'S POUNDS, KRONOR OR THE FUTURE EURO, MARKETERS ARE QUESTIONING HOW MUCH MONEY THEY SPEND, HOW THEY SPEND IT AND WHERE THEY SPEND IT. THE ANSWERS ARE CHANGING HOW MARKETERS, MEDIA AND AGENCIES DO BUSINESS.EDEFINING EUROPE

Published on .

Most Popular
As european nations struggle to codify the rules of a single-market continent, marketers are redefining Europe in myriad ways.

Many advertisers are looking for ways to do more with less.

"The amount companies are willing to pay for marketing services is imploding," said the European CEO of an international agency network trying to adapt to changing client needs. "It forces agencies to re-analyze their economic foundations, and it forces marketers to look more closely at the way they spend dollars."

One of the most significant trends is clustering. Advertisers and their agencies are increasingly driving marketing for a broad cultural group of markets out of one city.

Colgate-Palmolive Co., for example, is setting up "centers of excellence" with its global agency Young & Rubicam in several markets that will create advertising for surrounding countries.

"Some markets will be winners and some losers," said an agency executive grappling with shifting assignments from individual markets to new clusters. "We encourage managers to aspire to be centers of excellence, offering the best quality service at the best price. In Europe, it makes a lot of sense."

Scandinavia, for example, is emerging as a cluster for marketers and their agencies. Sony Corp., IBM Corp., PepsiCo International and Hasbro have all opened headquarters in Copenhagen-as have their agencies.

"The reason is not only to service our pan-Nordic clients, but also these countries work in similar ways and have similar creative standards," said Lucas Mees, president of Northern Europe for DDB Needham, which opened a Nordic office in Copenhagen last year to work with Hasbro, Sony and other clients.

"It means we try not to repeat everything four times [in four different countries]," said Lars Thomassen, managing director of BBDO Copenhagen, where BBDO set up a Nordic division in December. From Copenhagen, BBDO handles Pepsi's leaflets, packaging labels and in-store competitions for the region.

In Europe, J. Walter Thompson Co. is divided into four clusters: Iberia, German-speaking markets and Eastern Europe, Nordic countries and the United Kingdom. Other markets like France and Italy are handled separately.

Miles Colebrook, president/CEO of JWT Europe, Middle East and Africa, said the move lets clients like Kellogg Co., Kraft Jacobs Suchard and Nestle S.A. transfer ideas and suggestions within clusters by liaising at a single office for a number of similar markets.

The fact that JWT, among others, has included Eastern Europe in its clusters indicates one of the tidal changes in Europe.

Eastern Europe wasn't even on the map for international marketers before the 1990s (see Page I-28). Today, David Jones, PepsiCo International's East Europe-Central Asia president, talks casually about sponsoring Russia's cash-strapped space program, perhaps with the first orbital outdoor board or a manned Pepsi moon landing.

Like politics, technology has also forced marketers and agencies to re-examine their approach to the European market.

Marketers are experimenting with new technology and the Internet, both to reach consumers and to manage their own advertising more effectively. British Telecom is doing a major interactive TV trial with advertisers (see Page I-26).

Marketers are also looking at new ways to reach border-crossing demographic groups, such as fickle youths (see Page I-30), and to integrate their brands better within each market (see Page I-28).

To better target upscale consumers, the new European Media and Marketing Survey, based on 90,000 interviews with adults in 17 countries by Dutch research group Inter/View, Amsterdam, makes the case for using regional TV and print media (see Page I-24).

Even regional media, however, are redefining Europe.

Time is joining national circulation audits in major markets to better compete with local publications. And MTV Europe, which gets 80% of its ad revenue from pan-European ads, may offer more local ads this year to advertisers wanting only specific countries.

"While we're still maintaining MTVE as a European channel, we're adding local flavor," said Boris Katz, senior VP, MTV Networks Europe.

In this article: