Marketing Budget to Remain at $20 Million

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SAN FRANCISCO ( -- Starbucks Coffee Co. is entering the final stages of a search for an advertising agency for its creative and media account, an executive familiar with the situation said.

The executive said a group of fewer than five finalists from throughout the nation have been selected to participate in yet-to-be-scheduled final presentations. Starbucks, which has spent about $20 million on its retail account, does not intend to increase its paid marketing activity, instead sticking with its traditional print and outdoor ads, guerilla marketing and other viral efforts, the executive said.

Account was with LB Works
Starbucks also has a number of pieces of its joint venture advertising accounts at various agencies, including Publicis Groupe's Fallon, Minneapolis. The review, however, involves an account previously at Publicis' LB Works, Chicago, which is being folded into parent Leo Burnett USA, an agency for competitor McDonald's Corp.

A Starbucks spokeswoman said in regard to LB Works, "We have completed our current contract with them and appreciate the work they have done." She declined comment on the agency search.

"Due to the confidential nature of some of our work, we are not able to provide comment on the specifics of agency searches," she said. "We continually assess our business needs and will make new decisions regarding our advertising agencies when appropriate."

Steve Boehler, the founder of Mercer Island Group, which is conducting the review, declined comment.

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