Amazon Taps Initiative to Serve as Global Media Agency

WPP Mindshare was the Incumbent on the Business

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Amazon has selected Interpublic Group of Cos' Initiative following a fast-paced global media agency review that began earlier this year.

WPP's Mindshare handles the e-tail giant's offline media work and sibling agency MEC supports digital media. Digital media was not part of the review, according to people familiar with the matter.

Consulting firm Accenture managed the review process.

In addition to incumbent Mindshare, shops that participated in an early round of the review included Initiative, Publicis Groupe's Zenith and Mindshare sister agency MediaCom. In the final round Initiative went up against the Group M shops.

Representatives for Amazon and the agencies either declined to comment or didn't respond to requests.

The Accenture-managed review process differed from the norm when it comes to agency reviews. For example, Amazon made it very clear that agencies should not decorate their shops, or display Amazon signage or logos during meetings or presentations, according to executives familiar with the matter. The goal, noted the executives, was to keep the presentations as simple as possible and to get a more realistic sense of what the agencies could actually do for the brand.

What was less clear was the scope of work outlined in the original RFP, executives familiar with the matter had said of the early stages of the review. But they speculated that broadcast media would likely assume the majority of the media mix. They also speculated the agency would be tasked with promoting new Kindle models and various new product launches.

With competition heating up on the e-reader and tablet fronts, Amazon, acquired book-sharing social-media platform Goodreads. Fashion e-tail is another marketing focus for the company, which earlier this year announced its first TV ad campaign touting its fashion offerings. Cathy Beaudoin, president of Amazon Fashion, told Women's Wear Daily that the company hopes a TV campaign will create greater awareness of's fashion editorial content and brands.

The move to shift agency accounts also comes as the company gets more aggressive in the digital media and consumer electronics business. Amazon recently announced plans to launch a set-top box for Internet streaming over TV, as well as plans for its own smartphone.

According to Kantar Media, the Seattle-based company and its and Quidsi brands spent $298.8 million on U.S. measured media in 2012. Mullen supports the Zappos brand, which was not part of this review.

In 2011, the company spent $777.6 million on total U.S. advertising, including measured and unmeasured spending, according to the Ad Age DataCenter. The DataCenter also reported an uptick in measured-media spending in 2011 from $161.7 million in 2010 to $199.5 million. Zappos accounted for about $32 million of that spending. While the largest chunk of Amazon's budget in 2011 went to network TV -- $68.7 million -- the company also spent $54.1 million on magazine buys, as well as $30.9 million on display ads. Unmeasured spending accounted for $578 million of the company's total marketing budget.

Global spending is expected to be higher.

Initiative is celebrating the win after a tough couple of years on the new business front and a number of leadership changes within the agency and at parent company IPG Mediabrands. As part of a reorganization, the company promoted Jim Elms to global CEO of Initiative and Peter Mears to North American president of the agency. The agency also recently on-boarded DraftFCB's media business.

For Mindshare it's a tough loss. The shop, however, retained the LG business in North America. And a few other wins this year, such as Dyson, TGI Friday's and the consolidated Lionsgate account should soften the blow.

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