Agency representatives either declined to comment or couldn't be
immediately reached. But the decision, which comes after a lengthy
review, means that the international media duties that GSK awarded
to Publicis Groupe's Starcom MediaVest Group in 2010 will move
back to GroupM.
It hasn't been that long since GSK examined its global media
agency relationships. The last time it did so, in 2010, the outcome
was not as favorable to WPP. WPP-owned Mediacom -- one of four GroupM agencies and,
at the time, the incumbent on the GSK business in a number of top
markets -- lost business.The shop retained its $90 million U.K.
media planning and buying account, but months later GSK moved its
massive U.S. business to Omnicom's PHD. And after a
separate review in Europe, the company moved business in a handful
of European markets to SMG.
Now, the marketer is cutting out Publicis Groupe and Carat, which worked in some global
markets. It's streamlined its relationshios to consolidate the bulk
of its media business with the two ad holding companies. GSK will
also retain Dentsu, but just in Japan.
"The decision to consolidate our media investment with two
network partners – GroupM and OMG, with Dentsu buying in Japan, is based on
various factors including simplicity and speedier deployment of
best practices," said Sam Singh, VP-global media at GSK in a
statement. "We believe this sets us up with a fit for purpose media
system into the future. We continue to hold the outgoing agencies,
Starcom and Carat, in the highest of regard.
They have consistently exhibited high levels of professionalism and
we wish them all the very best."
New Media Exec from P&G
The move to review the global business this year came five months
after Mr. Singh joined GSK as VP and head of global media with a
remit to develop a new approach to media for the global consumer
healthcare and pharmaceutical giant. Mr. Singh joined from Procter &
Gamble, where he was VP of media in Asia and China.
A media agency consolidation will likely create efficiencies and
savings for a marketer that has reported declining advertising
spending since 2010. The company spent $1.3 billion in 2012, $1.46
billion in 2011 and $1.5 billion in 2010. In 2012, it spent $726
million on total advertising in the U.S., according to the Ad Age
The company spent $435.4 million on domestic measured media in
2012, according to Kantar Media. Globally, it spent $1.59 billion
on measured media in 2011, the last year of available global
spending data in the Ad Age DataCenter.
Various WPP media shops will chip in on the work going forward.
GSK is one of WPP's many multinational accounts that utilizes its
team model; it has done creative work for the pharma giant too in
the past, including work on a global branding brief.
Although pharmaceuticals accounted for 81% of worldwide revenue
in 2012, consumer health brands and prescription brands like Advair
were the big marketing spenders. GSK's top U.S. spenders include
Advair ($110 million), Sensodyne ($77 million), Breathe Right ($30
million), Aquafresh ($23.2 million), Abreva ($22.8 million) and
Nicorette ($22.7 million), according to the Ad Age DataCenter. GSK
also owns Tums, Biotene, Lovaza, nicoderm, Jalyn, Poligrip and
Polident, among others.