SAN FRANCISCO (AdAge.com) -- Omnicom Group's TBWA Worldwide has begun an expansion of its direct marketing, interactive and promotions network Tequila in North America by aligning it with the I-Group unit at Omnicom sibling Martin-Williams.
Steve Collins, president and CEO of Martin-Williams, Minneapolis, said his agency had been looking to expand into those same below-the-line disciplines handled by Tequila, but instead of acquiring an independent shop, the agency chose to affiliate with TBWA.
Like a franchise
"We're licensing the [Tequila] brand, but revenues will stay in Martin-Williams," said Mr. Collins, who compared the move to a "kind of a franchise for this area." He said the model is already used in Europe, and TBWA championed bringing it to North America.
Martin-Williams in 2000 began promoting its integrated capabilities to clients, but marketers needing specific services hadn't been looking to the shop, Mr. Collins said. "That's a part of the marketplace where we'll use Tequila," he said.
Mr. Collins said the Tequila arrangement will give the agency access to talent in an area "where it didn't make sense for Martin-Williams to hire a specialized capability." For that access, Martin-Williams will pay a percentage of new revenue to Tequila, he said.
Gregg Sampson, currently managing director of Martin-Williams' $6 million I-Group, which has 40 employees, will take over the Tequila-branded Minneapolis unit as managing director, reporting to Mr. Collins. Wes Nichols, president and CEO of Tequila North America, said Mr. Sampson, under a "dotted line" arrangement, will also report to him.
$200 million in billings
Tequila, which launched earlier this year in North America, expects billings of over $200 million in North America and reports billings of more than $1 billion for Tequila Worldwide. Tequila has 31 offices in 23 nations. The North American operation, headquartered in New York, also has operations in Playa del Rey, Calif., and Toronto. In each office, Tequila works on its own clients as well as those of the primary TBWA Worldwide shop. Worldwide clients include Absolut, Embassy Suites, Infiniti, Kmart, Nissan, Pfizer, Sony PlayStation and Visa.
Separately, Mr. Nichols said Ian J. Baer, 36, who served as executive vice president and director of directDeutsch, part of Interpublic Group of Cos.' Deutsch, Los Angeles, for more than a year, next month takes on the newly created post of chief strategic officer for Tequila. Mr. Baer, who was president of the Chicago office of Omnicom's direct marketing agency Rapp Collins Worldwide, said he will be focused on developing what he called "the next generation of marketing communications."
Martin-Williams, with gross income of $46 million, has billings of $320 million and in May won the $71 million account of retailer Staples Inc. following a pitch. The shop, which also handles the L.L. Bean advertising account, also has done interactive work for Target Corp., Scott's Lawn and Gardens, Polaris Industries, Marvin Windows and Lincoln Financial Group.
CORRECTION: An earlier version of this story incorrectly reported that Martin-Williams President-CEO Steve Collins would also report to Tequila North America President-CEO Wes Nichols.