NEW YORK (AdAge.com) -- Johnson & Johnson is reevaluating its global agency relationships on its portfolio of baby products, a move that could deal a blow to both its longtime lead creative shop for that brand, Interpublic Group of Cos.' Lowe, along with digital shop Profero.
The agency review, which will take six months to complete, follows other recent changes to the health-care giant's agency roster. It comes as the company is under tremendous pressure to boost sagging sales and faces FDA scrutiny after repeated recalls for some of its over-the-counter medications.
J&J began reaching out to agencies this week, industry executives said, informing them that its premiere Johnson's Baby account would be under review. A field of about 10 network shops, which could include non-roster agencies, is expected to be cut in half to five finalists that will compete for the account. Lowe and Profero are both expected to defend the business.
Two people familiar with the situation pegged overall global revenue on the account at about $20 million -- with about a tenth of that figure, some $2 million, representing the fee in North America -- though one executive estimated it was lower.
While Lowe and J&J have long enjoyed a successful relationship around the globe, in the U.S. it has been rocky marriage for the past few years, with a key sticking point being the fleeting nature of relationships between top executives at Lowe and top marketers at J&J. The marketer's execs were said to have had strong ties to Andrew Langer, formerly global creative chief on the baby account who is now at Omnicom Group's Roberts & Langer DDB, and to Mark Wnek, former Lowe, New York, chairman who ran the global baby account before he was left out of the merger between Lowe in the U.S. with its Interpublic sibling Deutsch.
Fifth biggest marketer
The agencies could not be reached for comment by press time. J&J spokesman confirmed to Ad Age that the company is conducting an agency review for Johnson's baby business. He declined to comment on whether the review includes digital duties; who in J&J management had called or led the review; or whether it had anything to do with the Lowe-Deutsch merger. "We regularly review our agency partnerships to ensure that our brands have optimal support," the spokesman said.
Earlier this year, Johnson & Johnson moved creative, media planning and digital duties on its Tylenol and Motrin brands from Deutsch, its creative agency of record since 2003, to the Martin Agency, part of Interpublic. Lowe is said to have been fretting about the status of the baby account since that time; while it's a global piece of business, J&J is based in New Brunswick, N.J.
J&J is a massive global advertiser. In the U.S. alone it ranked as the fifth biggest marketer last year by ad spending, with a total budget of $2.5 billion, according to the Ad Age DataCenter. It's also hard to downplay its importance to Interpublic, where it ranks among the holding company's top five largest clients.
Separately, J&J has a world of other concerns right now, thanks to its McNeil Consumer Healthcare division voluntarily recalling Children's Tylenol, Motrin, Zyrtec and Benadryl last week because they didn't meet internal-testing requirements or could contain "tiny particles." The company has been grappling with the fallout, as parents have taken to Facebook, Twitter and elsewhere to publicly complain.
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Contributing: Jack Neff