Havas' Euro RSCG, MPG to Defend Estimated $300 Million Business

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NEW YORK ( -- The past week has not been good to Paris-based ad agency holding company Havas.

Last week Volkswagen AG said it was

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evaluating its $800 million global media services account, while chip maker Intel put its worldwide corporate advertising and media buying and planning accounts into review, a spokeswoman for the Santa Clara, Calif., company said today.

$450 million from VW
The two moves, less than a week apart, affect two of Havas' main agency networks -- Euro RSCG Worldwide and Media Planning Group, which has Volkswagen of America's media services account. In the U.S., VW of America spent $450 million in measured media in 2003, according to TNS Media Intelligence/CMR. The creative portion of the account, handled by Arnold Worldwide, Havas' third network, is not part of the review.

Intel, meanwhile, has been with Euro RSCG, which handles creative responsibilities, since 1991; MPG does media buying and planning. The Intel review, rumored to be coming down for several months, opens one month before the arrival of Intel's new chief marketing officer, Eric Kim. Mr. Kim was most recently at global consumer electronics company Samsung, which is also in the middle of a review.

Will defend Intel
Euro and MPG intend to defend their portion of the Intel business, according to an executive familiar with the matter. The agencies referred calls to the marketer.

Select Resources International, Santa Monica, Calif., is conducting the Intel review.

While Intel is by far the industry leader in the PC semiconductor market, with an 83% share, the company has slipped with a couple of recent innovations, losing ground to rival AMD, which was the first to offer a 64-bit processors and dual-core chips. (Both companies are now expected to release the chips in 2005.)

Aggressive marketing
In the U.S., Intel spent $115 million on measured media in 2003, according to TNS Media Intelligence/CMR. The U.S. accounted for 34% of the global PC market last year, according to market researcher Gartner. Reflecting Intel's aggressive marketing worldwide, spending on the global account is estimated at more than $300 million worldwide. According to Intel's annual report for 2003, the company spent $1.8 billion on advertising; however, the bulk of that was devoted to Intel's "Intel Inside" co-operative advertising program in which PC makers receive monies for joint promotions.

An Intel spokeswoman would not comment on the marketer's spending plans but said it will continue to work with Euro RSCG in the coming months for ongoing advertising. Mr. Kim starts Nov. 15, and, she said, "as you know, these things take some time to complete, so we anticipate Eric will be on board and involved with the decision."

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Beth Snyder Bulik, Alice Z. Cuneo, Bradley Johnson contributed to this report.

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