The two Interpublic Group of Cos. shops are setting up a combined unit, called InitiativeFCB, which consists of FCB's in-house media planners and Initiative Media's media buyers. FCB is still to name the head of the unit, which will control some $400 million in global media planning and buying business in up to 55 countries.
In the U.S., FCB currently handles Samsung's creative and media planning while Initiative handles buying. In some overseas territories, FCB handles both. FCB will also pick up local ad budgets in a number of smaller territories.
`bits and pieces'
FCB holds the U.S. creative account for consumer products, which was not in review. Product work in the U.S. is carried out by Cheil Communications, the in-house advertising agency owned by Samsung.
WPP Group's MindShare is said to have pitched against the FCB/Initiative team, though executives at that agency claim that although they received an invitation letter they did not pitch.
FCB Chief Executive Brendan Ryan said, "We are significantly expanding the scope of our responsibilities; we had bits and pieces. The buying power of Initiative is being combined with the planning that comes out of the agency. They are being combined in a separate entity at Initiative."
The review and subsequent changes were prompted by Samsung's desire to find a better and less costly way to do business with its agencies. The company had hired management consultant Accenture to work on a cost-savings and efficiency project.
Beyond media planning and buying, Samsung is also tapping additional services such as Iconsulting, an FCB/Initiative unit which helps to validate the amount of money being spent on advertising.
Separately, Samsung held a second pitch for a corporate branding project that may lead to a complete corporate overhaul for the Korean-based company. FCB pitched in partnership with Marketing Corporation of America, another Interpublic agency, which specializes in branding. WPP's branding firm Landor Associates, which already works on projects for Samsung, is said to have pitched for this business against the agency.
Mike Emerson, senior VP-worldwide account director for Samsung at FCB, said the client "gets to tap into a larger pool of resources. They were looking at every facet of their communications and that is why it is so significant. ... They want to see more evidence of the synergy. It pays to put together a package of resources that are already there [in IPG]." Mr. Emerson confirmed the move would bring FCB cost savings.
FCB is working with Samsung on a new round of "Matrix"-themed advertising. Samsung is also a major Olympic sponsor and is looking to make its Athens 2004 sponsorship consistent with previous Olympic Games efforts.
contributing: lisa sanders and richard linnett