PILLSBURY'S $100 MIL PROMO BIZ TO 3 SHOPS

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Pillsbury Co., after an exhaustive half-year review, has consolidated its promotional business -- up to $100 million in spending -- with three agencies.

In opting for promotion agencies of record, Pillsbury is abandoning its system of working on a project basis with up to 50 shops.

CLARION, DUGAN, RYAN

The AOR assignments are organized along category lines. Clarion Marketing, Greenwich, Conn., will handle meal products, including Old El Paso and Green Giant brands. Dugan Valva Contessa, Morristown, N.J., was named to handle breakfasts and snacks as well as promotions designated "mega events." Ryan Partnership, Westport, Conn., will handle baked goods.

Pillsbury confirmed the review but said it "can't discuss the status" of it at this point.

Two of the agencies, Ryan and Clarion, had no formal relationship with Pillsbury prior to what Clarion CEO Ray Rizzo called the "pretty large cattle call." The reference was to questionnaires the marketer had sent to promotional shops earlier this year.

The field was eventually winnowed down to six agencies that were given hypothetical projects, followed by the choice of the final three.

The assignments are currently for consumer promotion, but there is potential for co-marketing and other trade promotion activity down the line, said executives close to the review.

NEW RYAN OFFICE

Ryan plans to open a dedicated office in Minneapolis, Pillsbury's headquarters city, to be headed by John Bell, the VP in charge of the account. Mr. Bell was previously a managing director in Ryan's Dallas office.

Clarion has established an office on site at Pillsbury headquarters to service the business.

Ryan President Tom Libonate declined comment on his shop's win, but said there is a trend generally "among package-goods clients moving from internal departments to establish agency-of-record relationships" for promotion.

Among other clients said to have moved toward promotion consolidation are Coca-Cola Co., Georgia-Pacific Corp. and Nestle USA.

RESEMBLING AD WORLD

"We're seeing the same things that have happened in the ad world," said Clarion's Mr. Rizzo. "[Marketers] are limiting the number of agencies, vendors, partners because of the efficiencies involved."

The idea is to present "one voice to the consumer" from advertising all the way down to below-the-line disciplines, said Burt Flickinger, consultant with Reach Marketing. He predicted the move toward promotion consolidation will renew ad agencies' interest in acquiring shops like Ryan.

Clarion already is owned by MacManus Group.

Paul Kelly, president of Silvermine Consulting, opined that promotion, even among larger marketers, is still often a seat-of-the-pants proposition.

The Pillsbury consolidation "is unusual in that with consumer promotion, whichever agency has the best idea gets the business. Unlike advertising, promotion is determined by what [sweepstakes, contest, etc.] is hot at the moment."

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