PHD Wins $1.4 Billion GSK U.S. Media Account

Incumbent MediaCom Dealt Blow in One of Biggest Media Pitches of Year

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NEW YORK ( -- GlaxoSmithKline has awarded its $1.4 billion U.S. media account to Omnicom Group's PHD, beating out incumbent WPP's MediaCom, Publicis Groupe's Starcom and Havas' MPG, according to executives with knowledge of the review.

The review covered the planning and buying duties on the consumer health-care and pharmaceutical businesses across all communication channels, including TV, print and digital.

In winning one of the biggest media pitches of the year, PHD has taken a major step toward filling the hole left by the departure of its biggest client, Chrysler, one year ago. The agency also named Andrew McLean, former worldwide chief business development officer at WPP's Group M, U.S. CEO, in late October. Mr. McLean replaced Scott Hagedorn, who is now heading the Annalect Group, a new digital and data analytics agency within Omnicom Media Group.

"Throughout the review process, PHD demonstrated impressive creativity and strategic planning savvy, which they paired with a highly competitive cost base," said Jim Martin, VP Procurement, "We were also impressed by their digital media innovations, and we believe they are the best possible partner to lead us into the future." The agency referred calls to the client. The review was handled by consultancy Ark Advisors.

The loss is a major blow to incumbent MediaCom, which no doubt is looking to put 2010 behind it. During the past 12 months the agency has lost a number of high-profile accounts, including Diageo ($130 million), Darden's Red Lobster planning business ($119 million), Ethan Allen ($23 million), JetBlue ($10 million), Lifetime Entertainment ($40 million) and the American Egg Board ($13 million).

It did pick up the $95 million Traveler's Insurance and $100 million Revlon accounts earlier this year.

GSK ranks No. 18 on Ad Age's 100 Leading National Advertisers report, with more than $1.4 billion in U.S. ad spending.

During a European review earlier this year GSK shifted some assignments away from MediaCom to Publicis Groupe's Starcom, including Germany, Austria, Switzerland, Spain and Portugal. But it's the first time GSK has reviewed the U.S. portion of its advertising account in nearly a decade.

The company produces and markets consumer health-care products including Aquafresh, Alli, Geritol, Nicorette, Nytol, Super Poligrip and Tums. Some of its prescription medicines include Flonase, Valtrex and Zantac. In late July GSK reported more than $10 billion in sales for the second quarter of 2010 and more than $22 billion for the first half of the year.

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