THREE VIE FOR $350M GLOBAL BAYER BUSINESS

By Published on .

Most Popular
DDB Needham Worldwide is in a good position to join sister Omnicom Group agency BBDO Worldwide as a major Bayer AG shop, as the pharmaceuticals marketer nears a decision on consolidating its $350 million global consumer products account.

Bayer U.S. executives met with DDB Needham executives last week again in New York. About three weeks ago, DDB Needham and BBDO, both New York; and Foote, Cone & Belding, Chicago, made global presentations for Bayer AG officials. A decision is expected in mid-November.

It was a surprise that DDB Needham was invited, since the agency only recently won its first Bayer work, a product assignment in Spain. The agency's presence appears to jeopardize the $65 million in U.S. Bayer spending now at Foote, Cone & Belding, Chicago. Bayer refused to discuss the review, as did the agencies involved.

McCann-Erickson Worldwide, New York, with $20 million in Bayer U.S. billings, and Tatham Euro RSCG, Chicago, with $30 million, weren't invited into the pitch. Bayer is expected to name at most two lead agencies; one insider said a third agency for Latin America may be a possibility. A total of 40 agencies, including Grey Advertising and Lintas Worldwide, handle about $200 million in Bayer spending outside the U.S.

With $20 million in U.S. billings, BBDO is seen as the favorite. The agency has Bayer aspirin in the U.S. and a recent Alka-Seltzer win in Japan, among other overseas assignments.

While McCann will lose Alka-Seltzer, Alka Mints and Phillips' Milk of Magnesia, it will not be without Bayer business as the Agfa film and chemical accounts aren't affected by the consumer products consolidation.

Much of the decision seems to hinge on global capabilities. Presentations last month were about credentials and resources, not creative, exploring how the company should handle its businesses worldwide and what kind of global agency depth there is to help them. BBDO took great pains to show the depth of its international presence.

Some industry observers say Bayer would be smart to have one agency focus on its problems in the U.S.

"Their company name is the same as their analgesic product, which is dying" in the U.S., said Allen Adamson, managing director of New York consultancy Landor Associates. "In Europe they're not tied to a single, dying product, it's more of an `advanced medicine' image there."

Leverkusen, Germany-based Bayer-barred from marketing in the U.S. since World War I-has been in the midst of massive change since the company won back its U.S. rights last spring. It absorbed American subsidiary Miles and acquired Sterling Winthrop's North American over-the-counter drug business from SmithKline Beecham for $1 billion, regaining rights to the ailing Bayer aspirin business.

Contributing: Pat Sloan, Jeanne Whalen and Mark Gleason.

In this article: