Frito-Lay's CMO: Agencies of Record Are Outdated, Lay's Brand Has Gone Project-to-Project

'The Way We Look at It Is: Who is the Best-Suited for What We Are Trying to Do'

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Add Frito-Lay to the list of marketers ditching the agency-of-record model.

Frito-Lay North America CMO Ram Krishnan on Friday confirmed that the PepsiCo-owned division was no longer working with Energy BBDO on the Lay's brand and has shifted to a project approach for its creative.

"We go project-by-project, brand-by-brand," he said. "We don't restrict ourselves to … one agency."

"I hate to say one brand is with one agency for eternity," he added. "The way we look at it is: Who is the best-suited for what we are trying to do with the consumer and the message?"

Energy BBDO, which is in Chicago, most recently created an ad for Lay's featuring Mr. and Mrs. Potato head.

The shop also played a role in the brand's Do Us a Flavor promotion last year. A BBDO spokesman referred calls to Frito-Lay.

For its Doritos brand, Frito-Lay has used Goodby Silverstein & Partners. But Mr. Krishnan indicated that he views that relationship as a project-to-project relationship. His preference is to call on multiple agencies for content, he said. For instance, "sometimes our PR agency, Ketchum, creates video content because it was their idea," he said.

For an upcoming summer campaign for Lay's, the marketer will rely heavily on digital shop Deep Focus and The Marketing Arm, which handles in-store advertising.

Other marketers moving away from agencies of record include Best Buy, which recently revealed that its longtime agency, Crispin Porter & Bogusky, would have to pitch for work alongside other shops. Snacks and candy giant Mondelez International is also known for shunning the AOR model. The marketer's CMO, Dana Anderson, wrote in the Wall Street Journal last year that AORs are "no longer the pathway to Oz for clients or agencies." She said that digital has "created thousands of new mediums," so "it is just not possible for one agency to be expert in all these areas."

Mr. Krishnan said that creative agencies were once viewed as the "custodian" for brands. But that notion is getting "circumnavigated" by the "two-way conversation" occurring on social media directly between brands and consumers, he said.

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