Shell Oil Co. plans to explore its options after Ogilvy & Mather, Houston, resigned its account late last week. A Shell spokeswoman would not say if the company will conduct a review or simply reassign the business.
J. Walter Thompson Co. is Shell's international agency, and last week JWT Specialized Communications, New York, added Shell's global recruitment account; Chernoff/Silver & Associates, Columbia, S.C., handles its corporate account.
With the resignation, Ogilvy will close its Houston office. The 60 staffers will work through mid-February. An Ogilvy spokeswoman said they will try to place those employees in other parts of the agency network.
Tro Piliguian, chairman of Ogilvy North America, said that handling only North America put Ogilvy at a disadvantage. Ogilvy felt a global relationship would be more advantageous and decided to resign the account for both parties' sakes.
NEARLY 30-YEAR RELATIONSHIP
Ogilvy handled the retail gas account in North America for almost 30 years and had bits and pieces of the account around the world. In 1998, Shell consolidated its global business with JWT in London.
Ogilvy created a corporate campaign called "Count on Shell" last year, but Shell moved the assignment to Chernoff/Silver a year after Ogilvy's lauched the effort.
According to Competitive Media Reporting data, Shell spent $56 million in measured media for 1998 and $11.5 million for the first six months of 1999.
"The one thing we all know in this business is all relationships eventually come to an end," said Joe Kilgore, co-managing director and executive creative director of Ogilvy's Houston office. The agency will also resign its local clients: Randalls Food Markets, Dynegy, Houston Museum of Fine Arts and Child Advocates.
LIST OF CLASSICS
Among the list of classic campaigns credited to Ogilvy were a print effort for Shell promoting the ingredients in its gasoline, and the well-known "Shell Answer Man" work.
In 1998, Shell and Texaco formed a joint operating alliance in the U.S. in which the oil giants combined their marketing efforts, but kept separate agency assignments. BBDO Worldwide, Houston, serves as Texaco's main agency, while Shell remained at Ogilvy.
In June, the two oil companies launched a $40 million ad blitz. Shell continued to promote itself as the convenient and quick alternative for fill-ups, while Texaco plugged the quality of its gas.
Earlier this month, Shell said its profits more than doubled to $1.81 billion in its third quarter from $841 million in the same period last year, largely due to rising oil prices. Shell also cited a cost-cutting program that seeks to slash $2.5 billion a year by 2001.
Contributing: Dave Guilford, David Goetzl.
Copyright November 1999, Crain Communications Inc.