Publicis’ Starcom Wins Lowe’s First Media Agency Review in 10 Years

The retailer spent $370 million on media in 2015

The account had been with OMD since 2005.
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Home improvement and appliance chain Lowe’s has chosen Starcom Worldwide as its new U.S. media agency of record after a five-month review.

“Lowe’s continues to explore the most compelling and efficient ways to reach consumers in a dynamic and ever-changing marketplace,” said Lowe’s CMO Jocelyn Wong in a statement. “We were impressed with Starcom’s capabilities and their digital first, omnichannel approach to media and believe they will help us remain innovative and well-positioned to connect with home improvement consumers.”

The Publicis unit beat out Omnicom Media Group’s PHD and WPP’s Mindshare in the review, according to a source with direct knowledge of the matter. Incumbent OMD, which had handled the business since 2005, did not participate. BBDO remains the client’s creative agency of record.

“Having the opportunity to partner with Lowe’s, a powerhouse in the retail home improvement space, is a privilege for our agency,” Kathy Ring, CEO of Starcom USA, said in a statement. “As Lowe’s works to establish connections with its evolving customer base, Starcom is proud to bring our unique approach to determining what drives people to action by utilizing data, understanding their desire lines, and applying this knowledge to create real results for the Lowe’s business.”

According to Kantar Media, Lowe’s spent approximately $372 million on paid media in 2015 and $369 million from January to November of 2016. The review officially launched last September with global consultancy R3 managing the process.

Since then, the retailer has been through a series of internal shakeups. CEO Robert Niblock told investors in a November Q3 earnings call that Lowe’s had missed analysts’ sales estimates for the second time in 2016 as fewer consumers visited its physical stores, adding, “traffic slowed more than we anticipated in August and September before improving in October, which put pressure on our profitability in the quarter.”

Lowe’s also parted with chief marketing officer Marci Grebstein in the middle of the review, promoting Wong, the former svp of merchandising, to replace her in January. Earlier that month, the chain announced that it would lay off more than 2,000 managers as part of a shift in its store staffing model designed to facilitate more direct interactions with consumers. Lowe’s also plans to open 15 to 20 new stores in North America over the next three years, and the home improvement sector at large has outperformed Wall Street’s expectations in recent months due to what Home Depot CEO Craig Menear called “a healthy housing market and strong customer demand” during this week’s Q1 earnings call.

Despite this performance, Lowe’s—which remains America’s second-largest home improvement retailer—released a statement earlier this week confirming that it would move to eliminate approximately 500 jobs at its corporate headquarters in Mooresville, N.C. and support facilities in nearby Wilkesboro.