Initiative, under pressure, seeks top talent

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Interpublic Group of Cos. is looking to shore up the senior management team at Initiative Media, following account losses at the agency and issues over the handling of $500 million client S.C. Johnson & Son.

According to executives close to the situation, the holding company is interviewing for two top-level managers at the media specialist. The new hires look likely to work alongside Initiative CEO Alec Gerster to help stem losses at the agency and land new business.

Mr. Gerster claimed to know nothing of the recruitment plans. "Nothing is imminent, unless Interpublic is doing something that I don't know about." An Interpublic spokesman declined to comment.

Interpublic's decision to bring in additional firepower comes as Initiative prepares to defend one of the biggest media reviews of the year. Its client America Online, part of Time Warner, announced it was reviewing media agencies last month.

While Initiative has won media business around the globe this year-including Shell Lubricants worth between $40 to $50 million and ConocoPhillips, at $20 million-it has also suffered some multi-million dollar defections. They include: Gateway, which has billings of $168 million; Nextel Communications at $160 million; Six Flags U.S. business at $90 to $100 million; and Yahoo!, which spends around $42 million on media.

Initiative has also been wrangling with sibling creative shop Foote Cone & Belding over media arrangements for joint client S.C. Johnson. While Initiative handles media for S.C. Johnson in the U.S. only, it has been negotiating a global joint venture partnership with FCB, named IM/FCB, that would see it expand its relationship in Asian territories where FCB has its own media-buying operations.

internal concerns

An internal e-mail to senior FCB management, dated Sept. 15, and seen by Advertising Age, details some of the internal concerns over the handling of the account and issues related to the formation of the partnership.

"Why would we get into a global relationship with these folks? Why would we place the SCJ media assignment in that kind of environment?" wrote Mark Pacchini, exec VP-group management director heading the global S.C. Johnson account at FCB.

He wrote that SCJ is being pursued around the globe by large media groups, noting, "Dentsu just took the buying assignment from us in Japan by guaranteeing $2 million in savings on the national buy." Later in the e-mail Mr Pacchini noted that FCB and Initiative have struggled to agree how to handle the client's business in the U.S. "We've gone back and forth for months on costs and still haven't reached agreement," he wrote. "And what does the U.S. situation tell us about what's to come around the globe."

A spokesman for FCB said, "A number of these issues have long since been resolved."

S.C. Johnson declined to comment on the situation. "We have enjoyed and continue to enjoy a very good relationship with FCB and its sister agencies and we absolutely will not comment on any unsubstantiated information," a spokesman said.

contributing: jack neff

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