In Major Coup, Carat Gets Gillette's North American Communications Planning

Spending for the Men's Grooming Business Estimated at More Than $300 Million; SMG Retains Buying

By Published on .

BATAVIA, Ohio ( -- Procter & Gamble Co. has shifted North American communications planning duties for its Gillette men's grooming business to Aegis Group's Carat from Publicis Groupe's Starcom Mediavest Group in a major win for Carat and rare P&G loss for SMG.

Gillette spent $170 million on measured media last year on men's products, but the communications-planning assignment also covers other areas of marketing, including promotions, shopper marketing and other trade programs that likely at least double that figure.

Omnicom Group's BBDO Worldwide continues to handle creative duties on Gillette, and as "brand agency leader" for male grooming under P&G's relatively new agency management and compensation structure BBDO had a hand in making the move from one rival holding company to another. A BBDO spokesman said he was unaware of the move or the details.

Digital capability and male experience
"We were looking for digital capability and male experience" in making the move from SMG to Carat, P&G spokesman Damon Jones said. The move includes blades and razors, shave preparations, antiperspirants, body wash and hair care.

For SMG, which has dominated P&G's communications-planning work, it's a surprising and significant loss. SMG won most of the communications-planning assignment and all of the high-profile beauty and grooming business when the account was created in 2004. It then picked up the Gillette business when P&G acquired that business in 2005.

SMG continues to handle media buying for Gillette along with other P&G brands in the U.S.

Lead agency is in charge
For Carat, which was the junior partner in the 2004 planning assignment, the account is a big coup. Carat won the smaller and arguably less-glamorous pieces of the account in 2004, including paper products, pet food and Pringles.

Carat was a surprise winner at the time, as it was new to P&G's roster, but it also had trouble holding onto what it won subsequently. P&G sold off some -- as in the case of Folgers and the coffee business last year -- or otherwise moved its accounts, as with Pringles. The latter moved to WPP's Mediacom after WPP sibling Grey Global Group became brand agency leader.

Under the BAL system, which Gillette and Pringles use, the lead agency is in charge of compensating and choosing others down the line, though P&G continues to have a hand in both areas via annual reviews and final say on assignment shifts.

The move comes as Gillette has lost some share in the past year in its core blade and razor business and considerably more share in other areas, such as shave preparations, in both cases to Energizer Holdings' Schick and Edge, respectively. Edge's gains came on a repositioning and heavy promotional spending by SC Johnson prior to selling the brand to Energizer earlier this year.

IRI data for the 52 weeks ending Nov. 1 show a 0.8-point loss for Gillette men's products in the cartridge segment and 0.4-point loss in razor handles, though a person familiar with the matter said the brand had lost only 0.2 points in razors in all-channel data including Walmart.

The brand also has been overshadowed or beaten in other segments by Unilever's Degree and Axe, including deodorant, body wash and hair care in recent years.

Axe outsells Gillette in hair care
In hair care, Axe is outselling Gillette by nearly three to one, with sales of $34.2 million to Gillette's $12.6 million in the 52 weeks ended Nov. 1, according to Information Resources Inc., despite Gillette getting a head start on Axe in the U.S. The data doesn't include Walmart, club or dollar stores.

In cases where Gillette has been having the most trouble -- hair care and shave prep -- it's been beaten by overtly sexual advertising, either by Unilever's Axe or by Edge, whose ads took on a decidedly Axe-like look in its repositioning last year.

~ ~ ~
Contributing: Nat Ives and Michael Bush

Most Popular