Subway Launches North American Agency Review Amid Sales Slump

Current agency partners and newcomers were invited to participate

After declining sales, Subway has 350 fewer shops than 3 years ago.
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Last October, Subway dropped BBDO New York as its creative agency of record just over a year after the agency earned that role during a review in August 2015. Following the AOR breakup, the fast-food chain returned most of its advertising work to former agency of record MMB.

Now Subway has launched an agency review for North America.

“Subway is launching a formal North America agency review, and approaching current agency partners, as well as a handful of other additional agencies and agency families, to participate,” a Subway representative wrote in a statement.

Presumably, longtime partner MMB is participating in the review. MMB officially deferred to the client for comment.

Interestingly, the review could impact more than just the chain’s creative account.

“We are evaluating all options, including bringing creative and media together, to drive efficiency and effectiveness across channels in a changing landscape,” the brand spokesperson continued.

“Subway is a partner-driven organization, and has long standing relationships, including 17 years with MediaCom, 14 years with MMB and 10 years with Carat. The brand has new marketing leadership in place in North America, and the team is focused on brand transformation, new digital initiatives and innovation,” they added. “We are looking for an optimal agency ecosystem where we can unlock the value of our data across all media and marketing activities to drive greater business results for our franchisees.”

The review is expected to conclude by early 2018. Subway spent around $100 million domestically on measured media in the first quarter of 2017, according to Kantar Media.

As noted, the launch of the review follows new marketing leadership at the company. In April, Subway appointed Karlin Linhardt to the newly-created role of senior vice president, marketing for North America.

The move towards a more efficient advertising model also comes as the chain struggles amid sluggish sales and declining revenue. According to Nation’s Restaurant News, the chain had 350 fewer locations in 2016 than three years earlier.