Rather, the main criteria are efficiencies, price and resources, according to participants. In other words, the single biggest differentiator among agencies—the ideas they conjure to build brands—won’t drive the decision.
No wonder shops feel like commodities these days.
Still, these are mega-marketers. J&J’s global marketing spend exceeded $2.5 billion last year, and Chevrolet’s annual global outlay is around $900 million. Given big budgets like that, roster shops eagerly line up, even as some bemoan the criteria.
J&J executives are “trying to get the best pricing and efficiency. It’s a very competitive situation,” said a top exec at a J&J agency. “I don’t want to be in this position. But you have to say, ‘OK, how do I make the best of it?’”
Numbers-focused reviews are “happening more often,” added a leader at another J&J agency. “I think part of that is the recession. And with the recession, procurement departments have gotten more power.”
Indeed, J&J’s procurement executives are working closely with marketing leaders on the review, according to Kim Kadlec, worldwide vp of the company’s global marketing group.
“Procurement is always a critical business partner in initiatives such as this,” Kadlec explained in an email reply to questions from Adweek. “We work very closely to ensure that we are getting the very best value and talent from our agencies and that we align business objectives to incentives in a way that inspires great work and measurable outcomes.”
In the Chevy review, agencies from rival holding companies—McCann Erickson of Interpublic and Goodby, Silverstein & Partners of Omnicom—took the unusual step of partnering once General Motors’ marketing chief Joel Ewanick signaled that he wanted to retain both shops. In March, they split the prize, with Goodby retaining the U.S. market and McCann gaining more overseas business. GM said it had eliminated dozens of Chevy shops as a result.
Consolidation also is a primary goal of J&J’s review, a roster shop-only affair that’s being managed by Kadlec and vp of global corporate affairs Michael Sneed.
The focus is on general market advertising for dozens of brands, including Listerine, Band-Aid, Tylenol and Johnson’s Baby products. Such brands are currently divided among agencies such as BBDO, DDB, JWT, McCann, Lowe, The Martin Agency and Mother.
Kadlec acknowledged the absence of creative pitches, but noted that J&J already knows the agencies well. “Our partners prove themselves every day on our business,” she added.
In tightening its creative roster, J&J will shift some brand assignments, sources said. J&J hopes to complete the process by early next month.