Lowe, Draft create consultancy, merge some functions

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Lowe & Partners Worldwide and DraftWorldwide insist that they are not merging. But they are consolidating back-office and administrative functions in some markets and have created a consulting unit, known as Plus, which will drive business to both agencies.

Jerry Judge, CEO, Lowe & Partners Worldwide and Howard Draft, chairman-CEO, DraftWorldwide, are each determined to find ways the two can serve marketers on a global basis, and thus both grow. The pair has spent the last year learning the details of each other's business, from budget to clients to proprietary services, with the goal of identifying collaborative opportunities. Lowe and Draft will retain their individual brands and independence.

`work in progress'

Costs can be cut, too, in the process, and "we're taking advantage of that where we can," Mr. Judge said. Back-office and administrative functions are being combined in Italy, Hong Kong, Sweden and Malaysia. "It's a work in progress," said Mr. Judge, and progress varies market by market.

But the growth is expected to come from Steve Harty, the former head of Omnicom Group's Merkley Newman Harty, New York, hired in January as managing partner to run Plus.

"There are two challenges for us," said Mr. Harty, who reports to Messrs. Judge and Draft. "First is to develop a more acute ability to listen for client-business issues. We'll have more resources to do that. The second is to help Lowe and Draft management find better ways to deploy their collective resources for clients."

Mr. Harty is building an independent profit center with a handful of full-time employees and a corral of outside consultants. With Plus, Lowe and Draft aim to give clients "more powerful, more strategic" marketing advice that will "drive dollars to the right place at the right time," Mr. Harty said. Draft, for instance, has quantitative analysis tools used to allocate marketing dollars effectively-services that might be useful for Lowe's clients.

In addition to working with current Draft and Lowe clients, Plus will look for some of its own. Its staff includes Debra Brown as chief marketing officer, most recently CEO of United Virtualities, New York, who has also led Thompson Connect, a one-time unit of WPP Group's J. Walter Thompson. Ms. Brown's charge is also to develop new-business opportunities for all the agencies in Interpublic's Partnership group.

"This will work if there is mutual understanding and mutual respect for what each other does," Mr. Judge said.

Both agencies stand to benefit from Plus. Draft, very strong in the U.S., works for marketers such as Bank of America, Burger King and Verizon. Lowe, in contrast, has a rich international client base, especially with HSBC, but is weak stateside. A key charge for Plus is to facilitate growth by showing Draft clients what Lowe can do, and vice versa, as well as devise marketing solutions that neither side would have arrived at on their own.

Lowe and Draft "will continue to gravitate toward each other," said an executive familiar with the situation, emphasizing that operating efficiencies and a full offering for clients make compelling reasons to be closer, but "large business opportunities for separate, direct marketing-and-promotion companies" mean the brands should remain distinct.

Clients shared by Lowe & Partners and DraftWorldwide include HSBC and Saab in London, and Verizon Wireless, now at Lowe following the merger of Lowe with Bozell.

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