Candy marketer Mars terminated its global partnership with Grey Global Group, soon to be part of WPP, as part of a consolidation with Omnicom's TBWA Worldwide and BBDO Worldwide. Unilever moved its estimated $10 million Lipton teas account in the U.S. from WPP's J. Walter Thompson, New York, to Omnicom's DDB Worldwide, New York.
Previous to the shifts last week, both companies had sought strategic and new-product development advice from Omnicom's Arnell Group. Arnell Chairman Peter Arnell has in recent months proffered ideas for the relaunch of the Lipton brand next year and has worked with Mars since 2001 as its principal "marketing development" agency, coordinating up-front creative strategies for new products and working with Mars' roster shops.
By Jan. 1, 2005, the work formerly handled by Grey-accounting for about $76 million in U.S. measured media spending in 2003, according to TNS Media Intelligence/CMR-will be reassigned. Global work for Mars' Starburst, Aquadrops and Cookies& brands will move to TBWA; global business for Milky Way and Mars brands will move to BBDO; and Twix and Dove brands will be handled in the U.S. by independent agency Nitro, New York, and by TBWA outside the U.S.
"We wanted to consolidate this into one family of companies where we felt we could get an even better across-the-board partnership," said a spokesman for Mars' Masterfoods USA division. Internet, direct and sales promotion will continue to be handled by Grey.
Mars' shift was not unexpected. Masterfoods last month awarded a new campaign for Twix to Nitro, a Shanghai-based agency it had worked with in Asia that has recently opened up shop in New York to handle the new Mars business (AA, Aug. 23). WPP Group Chief Executive Martin Sorrell, in announcing a deal Sept. 13 to buy Grey, an acquisition expected to close in December or January, told analysts he had already factored in the possibility of a Masterfoods loss.
A Unilever spokeswoman said that DDB, already a Unilever roster shop, "possesses the deep creative capabilities to help Lipton deliver world-class communication behind its key initiatives." JWT will retain the Lipton business outside the U.S.
The Lipton tea business includes ready-to-serve Lipton iced teas and Lipton Brisk that are part of Unilever and PepsiCo's joint Pepsi Lipton Tea Partnership. One retail executive said Lipton has been under fire from specialty tea marketers on the hot tea side, among them Kraft Foods' new efforts for Starbucks' Tazo, and that its iced tea has been eroded by regional brands. "They've rested on the laurels of the name Lipton for so long, but now everybody's gunning at them and winning."
Maybe Omnicom can help.