"They are no longer part of our review," said Catherine Bension, president of Select Resources International, the consultancy managing the process. She said Saatchi withdrew, but declined to give details about the agency's decision.
Already had connection
Saatchi's departure is surprising given that many observers felt Wal-Mart showed its cards by naming Saatchi & Saatchi X agency of record for in-store advertising and employee communications even as the general-advertising and media review progressed.
The departure leaves this quartet in the hunt for the Wal-Mart business: Omnicom Group's GSD&M, an incumbent; Interpublic Group of Cos.' Draft FCB Group and Martin Agency; and WPP Group's Ogilvy & Mather.
The move comes amid speculation that Saatchi has been making inroads with another retailer, J.C. Penney, which represents a conflict with Wal-Mart. (According to Big Research, 18.5% of J.C. Penney's core customers shop Wal-Mart for groceries and 38.6% shop the retailer for health and beauty.)
Meetings with Penney
Saatchi CEO Kevin Roberts has had meetings with J.C. Penney marketing executives, according to executives familiar with the matter. However, one of those executives said that Saatchi has pulled back since grabbing the Wal-Mart in-store business.
A Saatchi representative didn't immediately have comment. Calls to Penney Chief Marketing Officer Mike Boylson were not returned.
Moreover, there are some indications that DDB, Penney's longtime ad agency, is hedging its bets. Interactive agency Tribal DDB, which works with Penney, reportedly contributed to Wal-Mart's back-to-school effort and has assisted fellow Omnicom shop GSD&M in defending the Wal-Mart business, according to executives familiar with the situation.
'Not done work for Wal-Mart'
However, Matt Freeman, CEO of Tribal DDB, said the agency hasn't had anything to do with Wal-Mart, despite media accounts -- including some in this publication -- that attributed recent work to the agency. He said that work was actually done by Arsenal, a recently created website-development shop based in Dallas that's part of Omnicom's Diversified Agency Services, not DDB. He said the agency was "in part" spun out of Tribal. "Tribal has not done work for Wal-Mart," he said.
Final pitches in the Wal-Mart review are expected to take place during the second week of October.
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Mya Frazier contributed to this report.