LONDON -- Shell, one of the world's three largest companies, is now relying on two ad agency networks to help it develop a consistent global image following its appointment of J. Walter Thompson as the sole strategic and creative advertising agency for all Shell branded advertising in Europe. JWT now shares a place on Shell's roster with fellow WPP network Ogilvy & Mather, which handles the account in the U.S., Canada and South America. Last year JWT picked up the Shell business in most of Asia Pacific except Japan (which it shares with Hakuhodo) and also Australia and New Zealand where O&M handles.
JWT will handle advertising for Shell companies in a total of 30 countries across all of Western Europe, Scandinavia, Eastern Europe - including Russia and the Baltic states - and Turkey. Shell companies in Europe expect total advertising expenditure handled by JWT - including media spend, production costs and agency fees - is likely to range between $80m and $100m a year.
Prior to the January 10 announcement, JWT handled 25% of Shell's business in Europe, Publicis more than 25% and O&M just less than half, according to David Watson, Shell's Europe brand convergence manager, who led the review along with Andrew Blazye, brand development manager for Shell International, and Kjell Johnsen, Scandinavia brand manager. The Anglo-Dutch oil company used a fourth agency in The Netherlands called Campaign, which is affiliated with TBWA.
Along with JWT, Publicis and O&M pitched for the account, which took three months to review. The three person review team at Shell presented its recommendation to Shell Europe presidents on January 9, who then approved it.
Watson says Shell decided to consolidate its business in Europe with a single agency because it wants a more consistent brand image. Shell is also expecting "significant savings" in production costs as a result of using one network. "We haven't yet decided if we will run the same (advertising) material across Europe," says Watson. "Currently our brand message varies from market to market."
There were two main reasons why the review team chose JWT, Watson says. First, Shell was impressed by JWT's client services structure which allows smooth communications from the country level to the European level, and regional level to the global level. Second, JWT impressed Shell with the quality of its strategic thinking on what direction to take the Shell brand and how to communicate it. "This wasn't a creative pitch," Watson says.
The appointment of a pan-European agency follows last year's decision to hand CIA MediaNetwork all Shell's media buying across Europe, which will remain unchanged. CIA MediaNetwork pitched against Shell roster agencies Optimedia and O&M's The Network.
When the advertising accounts move will vary by country, but all Shell European countries are expected to be using JWT by the end of 1997. Watson says JWT's new work will be seen in some European markets by the middle of the year.
JWT previously handled the account in Greece and picked up the business in Germany last October from local agency Alexander Demuth, Frankfurt. Publicis held the account in France and Scandinavia, while O&M handled the business everywhere else in Europe except The Netherlands.
JWT says it will resign the Esso account in the U.K., worth an estimated $18m. McCann-Erickson handles Esso/Exxon in most markets around the world.
Copyright January 1997, Crain Communications Inc.