How Top Shops Stacked Up in '07
Ad Age Reviews Key Media Operations' Wins and Losses, Creativity, Use of Media Tools, and Management Stability
MediaVest strengthened its management team by promoting from within. When former CEO Laura Desmond became CEO of the Americas at Starcom MediaVest Group, her replacement came from a small group of insiders in contention for the job. New CEO Bill Tucker was the lead account man on Kraft Foods and head of client services for the agency.
As in years past, MediaVest's portfolio had a digital focus. A mobile scavenger hunt for Coca-Cola Co.'s Sprite aimed at teens drove more than 1.5 million people to join Sprite's online community and produced a 36% increase in teens' weekly consumption of the soft drink. As one of the industry's largest buyers of video on demand, MediaVest also initiated deals such as the exclusive VOD rights to the launch seasons of Martha Stewart on Demand and Lifetime on Demand. Only MediaVest clients' ads will appear on those VOD channels.
The agency also dived into the multicultural space last March, launching 42 Degrees at MediaVest, a dedicated multicultural agency, which had some early successes, picking up Continental Airlines and Heineken.
News Corp.'s Fox was quite a coup for Zenith and its CEO, Tim Jones. In what started out as a cable-only review, Zenith clinched an even bigger deal, winning network, planning and interactive for theatrical and home entertainment at six Fox studios. As a result, Zenith Los Angeles doubled its size and moved into new offices in Century City. Julie Rieger, the former account lead on Hewlett-Packard Co., was promoted to exec VP-managing director to oversee the expanded L.A. office.
Smart work from Zenith included a partnership between client Hewlett-Packard and MTV to help HP become more relevant to college students. A sweepstakes contest for the marketer drew 800,000 entrants.
For General Mills' Totino's Pizza Rolls, Zenith targeted male teens rather than moms, using action sports as a key marketing platform and building a partnership with ESPN's Winter
X Games. The effort, which featured athletic sponsorships; in-store and event marketing; and TV, print and interactive work, produced a 22% increase in male-teen consumption and a 19% lift in sales volume during the campaign.
Mr. Beaven has strengthened Initiative's planning and digital operations, a focus that's paying off not only in blockbuster pitches but with existing clients such as Bayer, Big Lots and Kao Brands, all of which have moved their planning business to the agency.
Next up for Mr. Beaven is taking his U.S. success global. Early in 2008, he was elevated to worldwide CEO of the Initiative network, bringing an end to a years-long hunt to replace Alec Gerster, who is retiring. The challenge for Mr. Beaven will be to inject the worldwide network with the same momentum its U.S. operations have enjoyed. The domestic operations will be in the hands of Tim Spengler, formerly chief activation officer.
If there's a question mark, it's from parent Interpublic Group of Cos., which late in 2007 named a task force led by Universal McCann CEO Nick Brien to look into efficiency at both agencies. Details have been murky at best, but it's safe to say that the more success Mr. Beaven racks up, the more insulated his shop will be from any corporate cost cutting.
20th Century Fox Filmed Entertainment, Sears Holdings Corp. and Samsung all left the agency, though organic growth and new accounts including LG Electronics and Royal Caribbean International generated a net increase in billings last year. MindShare produced strong work for its stable of major marketers, including campaigns that employed its substantial entertainment offering. For Unilever's Degree deodorant, MindShare negotiated a partnership with popular Fox show "24" to create two short films and six national commercials as the centerpiece of a 360-degree campaign that would associate the brand with power and risk. Degree's sales were up 22% during the campaign's 22-week run.
But it wasn't all Madison & Vine. MindShare showed econometric savvy on behalf of Sprint, leveraging consumer insights to refine the marketer's media mix, adding about $100 million in value through improved targeting.
Marc Goldstein moved into a leading role at Group M and was succeeded in the top North American job by Scott Neslund, managing director in the Chicago office. It'll be up to Mr. Neslund to improve new-business performance.
The agency replaced CEO Joe Uva, now at Univision, with Omnicom Media Group head Daryl Simm, while North American CEO Page Thompson focused on structural changes, including the launch of OMD's proprietary shared-learning consortium. The unit aims to understand how to activate new technology to leverage brands in the new-media landscape. The agency also aimed to better integrate digital by putting former OMD Digital Director Scott Hagedorn at the helm of OMD East.
OMD, which counts McDonald's, Apple and Hershey's as clients, stood out in 2007 by pairing with Goodby, Silverstein & Partners on Doritos' "Crash the Super Bowl" campaign, in which consumers were challenged to create a commercial for Frito-Lay's Doritos that would air during the game. Sales of the chip spiked 12% in January 2007, and the 1,070 user-generated spots were viewed 3 million times online. All in all, though OMD remains a goliath, it could take a page out of Starcom's book and assume more of a leadership position in areas such as media accountability and innovation.
Despite having been courted by bigger players, Naked went with Photon in the hope that it won't be forced to cross-sell its ad siblings, something that would have been tough at an Interpublic or WPP. It's an arrangement that should allow Naked to stay true to the media-agnostic heritage it's been trying to bring to the U.S. for the past two years.
So far, Naked's story here has been one of growth . The New York office has expanded with Coca-Cola Co.; Nokia; and, in the past year, Johnson & Johnson and Kimberly-Clark Corp.
But the U.S. market is waiting to hear what founding partner John Harlow's agency is actually doing for its clients. It still lacks a killer case study, perhaps a byproduct of the fact that Naked works in a consultant capacity for its brands. Some early work for J&J includes a mall tour for Acuvue contacts to make the brand more appealing to teens, including an Acuvue Star Trailer that will feature professional makeovers and an interactive video game.
The challenge is clear-cut: to retain the spirit of innovation that made Naked such a disrupter in the first place.
Mr. Rutman has reorganized MPG's U.S. operation so that it's more closely aligned with digital and direct sibling Media Contacts -- a move Sears executives have said was important in their decision to award MPG their business. Other structural changes included moving MPG's most experienced people to client teams; creating a video-integration unit to encourage cross-platform video buying; and adapting a new method of compensation that focuses on outcomes instead of hours.
While there were many steps in the right direction, MPG faced several small and midsize account losses including Royal Caribbean International, Outback Steakhouse and Talbots, something the agency needs to avoid in the future if it wants to sustain momentum. It also has to avoid being distracted by the Gallic financial maneuvering going on as Vincent Bollore, Havas chairman and the largest shareholder of Aegis Group, works toward the takeover of Aegis, which could result in a merger of MPG with Carat.
MediaCom won one of the year's biggest accounts -- the $340 million Dell business -- as part of a WPP holding-company team and spent the end of the year staffing up for the assignment.
MediaCom also benefited from a consolidation of business by pharma giant GlaxoSmithKline. GSK moved direct-to-consumer planning responsibilities from WPP's Mediaedge:cia to MediaCom and consolidated all its over-the-counter media-planning duties at the agency. MediaCom successfully defended two major accounts this past year: ConAgra and Staples.
In 2008, all eyes will be looking to see how MediaCom fares within the customized agency WPP is creating for Dell and to see if that new entertainment division can help the agency expand in the Madison & Vine space. Led by Adam Pincus, former VP-original programming for the Sundance Channel, MediaCom Entertainment has already produced some innovative work for Diageo, including an hourlong branded-entertainment program for Baileys Irish Cream featuring R & B artists John Legend and Jill Scott.
With that orientation, it's not surprising that some of the agency's best work in 2007 was in the digital space. Carat's mobile campaign for Adidas' "Basketball Is a Brotherhood" gave customers mobile text codes they could use to create customized voice-mails from NBA players such as Kevin Garnett. Results showed that purchase intent following the account was at 93%. Carat's work on Reebok International's "Run easy" campaign, which celebrates the casual runner, also was noteworthy. Using a mash-up of Google Maps, iTunes and Flickr at goruneasy.com, Carat connected runners to one another all over the world. During the first three months of the campaign, there were more than 16,000 registered users on the site.
Whether or not clients will embrace the new Carat has yet to be seen. The year in new business was rough at times. Carat lost a major account in Hyundai Motor America's $735 million Hyundai and Kia brands. The agency won $90 million Outback Steakhouse and $40 million Discover and kept Pernod Ricard.
Omnicom Group's second-largest media shop made two significant management moves. Former U.S. President Matt Seiler, who's been credited with fueling PHD's growth in years past, was made CEO-North America, taking over for Steve Grubbs, who moved on to head Omnicom's Fuse sports and entertainment group.
And Mike Cooper, a well-respected executive who laid the groundwork for OMD Asia in the 1990s, was tapped as the PHD network's new worldwide CEO, a position left vacant when co-founder David Pattison stepped down in April. Mr. Cooper will attempt to unite PHD's 45 offices so the agency can start to pursue some global accounts, a challenge it has yet to meet. Even in the U.S., the agency had just a so-so new-business year. Wins included New Balance and Overture Films, but the agency lost Quiznos and Energizer.
But the year was dominated by Chrysler news, most of it bad. In October, PHD said it was moving national broadcast and cable TV buying for the automaker from its Troy, Mich., office to New York. PHD made an undetermined number of cuts in Troy as Chrysler continued to slice marketing costs. The challenge for PHD will be to continue to diversify so the agency is less reliant on the revenue of a struggling marketer.
However, Optimedia did make strides to improve its competitive edge in pitches last year, reaching the final two in competitions including Pernod Ricard and Sony PlayStation. Digital, which represents 28% of the agency's revenue, was a focus in 2007 for Optimedia, which serves Whirlpool, T-Mobile, L'Or?al and British Airways. The shop added an emerging-technologies group and in-house search.
Optimedia brought on a new head of strategic resources, Greg Kahn, former VP-research and strategy at PHD. Frank Friedman, former senior VP-managing director of the Indianapolis office, became the head of local broadcast, succeeding Ellen Drury, who moved to WPP's Group M.
Standout work for Optimedia in 2007 included a deal with ABC's "The View" for client Curves. The campaign, which coincided with the 10th season of the show, challenged viewers to "Lose 10 in Season 10," with in-show promos, a downloadable tracking form and sweepstakes. Curves' call volume was up 29% in the weeks following the campaign.
Aside from that, however, there wasn't much good news for Mr. Brien and U.S. President Mary Gerzema. One of the shop's big clients, Intel Corp., put its media account in review, which was ongoing at press time.
It's uncertain what structural changes will unfold in the coming year as Mr. Brien heads an Interpublic Group of Cos. task force examining efficiency at the agency and sibling Initiative. The task force has fueled speculation that the holding company may be trying to bring the two units together, but Interpublic CEO Michael Roth has vehemently denied it. That would preserve the company's two distinct agency brands and avoid adding to its tragic history of mergers.
Here's one glimmer of hope: Bank of America has included Universal McCann in the review for its $230 million media business. A win of that size would go a long way toward ending a new-business drought that's gone on too long.
Structural changes included the launch of an insights team, which will inform and support Horizon brand teams. Horizon's direct-marketing group, which doubled gross billings for the second consecutive year, also restructured its direct buying group into two disciplines, TV and radio, to get better pricing in the marketplace.
Highlights last year included a campaign for A&E's original series "Paranormal State." Horizon's out-of-home for the show helped make it the biggest A&E series premiere in three years, with 2.5 million viewers.
Horizon could improve on the global scene, something that should be helped along by its affiliation with Columbus Media International, a network that links Horizon with 13 other independent media shops around the world so the agencies can operate individually but provide worldwide-network reach for clients. In 2007, Horizon hosted the network's first U.S. summit, but it remains to be seen how that will help the businesses involved.