For client MNBA, the holding company has built the Helm, an entity staffed by a core team of five WPP employees who draw on resources as needed from various WPP-owned companies such as Burson Marsteller for public relations, Maxus for media planning and JWT Specialized Communications for employee recruitment.
Led by Jim Johnson, formerly of branding and identity firm Enterprise IG, the Helm developed a logo for MBNA unveiled in August. Early next year, it will launch a multi-pronged advertising campaign with executions in TV, print, out-of-home and online. "There hasn't been an effort like this before," said MBNA Senior Exec-VP Communications Jim Donahue.
The new unit neatly sidesteps a conflict. With the addition of MBNA, WPP handles two of the nation's top five credit-card issuers as ranked by cards' dollar volume: No. 1 American Express (at Ogilvy & Mather Worldwide) and No. 4 MBNA.
The Helm is the third example to crop up within the past 24 months where WPP has created a unit to meet a single client's needs. In June 2003, Soho Square, based in New York, was launched within WPP for Yahoo. Formed to pitch Yahoo because WPP's Ogilvy & Mather was precluded due to its Spanish client Telefonica, owner of Yahoo competitor search engine Terra Lycos, Soho Square was "the right solution to draw on a number of resources from WPP," said a Yahoo spokeswoman. She declined to comment about conflict matters.
'a viable alternative'
A few months later, for General Electric Co. spin-off Genworth Financial, Klamath Communications was born out of WPP's branding firm Landor, which developed Genworth's name and tagline, "Built on GE Heritage." Landor sibling Y&R Advertising was precluded from handling advertising for Genworth Financial due its longstanding relationship with MetLife.
What differentiates these new entities from other so-called conflict shops is their business model: Their main purpose is to serve current clients rather than build up additional accounts and revenue. "They're a viable alternative," said Joanne Davis, head of consultancy Joanne Davis Associates, New York. "A client is hiring an agency but also a core team. Clients care about the people they're going to get who'll make a difference on their business."
The potential rub in a virtual-agency model is with issues like client confidentiality. As employees are added, pulled either from other WPP units or hired from outside, who is ensuring that, say, a former account executive on American Express is not tapped for MBNA?
Virtual agencies like Klamath also beg the question about the success of integration. For Genworth, Klamath built a team with people taken from Y&R for account management; Wunderman for direct, Landor for branding and identity, and Penn, Schoen & Berland for research. But in the spirit of the Whole Egg theory, why not pull in other company partners to fulfill the client's needs? That "works great for 9.5 out of 10 clients," said Allen Adamson, managing director, Landor, New York, who oversees Klamath. "But not for all."