McCann will handle an estimated $300 million worth of business for Reckitt Benckiser, including creative for the company's fabric-care, surface-care, homecare and health/personal-care categories. McCann will create a special London-based unit to guide the global business, coordinating the work of 22 agency offices.
The shifts come just six months after the merger of the U.K.'s Reckitt & Colman and Dutch company Benckiser to form a $5 billion household goods behemoth.
McCann has worked with Reckitt & Colman since January 1996, when the marketer awarded the majority of its household brands -- including Lysol and Wizard -- to the agency. The Interpublic Group of Cos. agency now increases its Reckitt Benckiser billings by 20% to 30%.
Prior to the merger, Benckiser used a multitude of small agencies. Reckitt Benckiser continues to work with about 12 to 15 small agencies. However, McCann now takes responsibility for half of Reckitt Benckiser's global and local work.
The boost to McCann's billings will come through increased spending behind existing products, the launch of new products and shifts among brand lines. Reckitt Benckiser's U.S. products include Woolite, French's mustard, Resolve and Electrasol.
OTHER AGENCIES CONSIDERED
Although Reckitt Benckiser didn't hold a formal account review, Marcello Bottoli, exec VP-category development, said the company did consider other ad agencies to handle the creative accounts. Media planning and buying will remain decentralized, with McCann handling a large part of that business.
"The merger provided us with an opportunity to rethink our operations," Mr. Bottoli said. He said the company will retain some of the shops Benckiser had worked with for the sake of stability and consistency.
"After a merger, there's a lot of uncertainty. Those [regional] agencies know our brands," he said. "We tried to find the right balance to retain creative flexibility."
As Reckitt Benckiser revamps its advertising assignments, the company also is making internal changes. It consolidated its global marketing, research and development, and consumer research departments into a category development unit headed by Mr. Bottoli. The 900-person department will combine "creative and technical" operations, said Mr. Bottoli. "They are both driven fundamentally by the consumer."
McCann also is setting up an unusual structure to handle the Reckitt Benckiser account. The agency created a central office in London -- near Reckitt Benckiser's headquarters -- that will be a clearinghouse of sorts for strategy and creative. McCann Exec VP-Director of Worldwide Accounts Gunnar Wilmot will run the office housing nine account execs and strategic planners.
McCann's London office will work with Reckitt Benckiser to distribute creative briefs to the 22 agency offices on the account. All creative, in turn, will be funneled back for approval through that office and Mr. Bottoli's department. The structure provides any regional McCann office with the opportunity to create global work, Mr. Wilmot said. "This isn't centralized, it's globalized," he said.
Advertising changes follow a positive quarter for Reckitt Benckiser, which reported a first-quarter earnings gain of 21% compared with 1999. Those improved earnings followed the launch of several new products, such as Lysol disinfectant wipes and an insect-seeking pest control product.