Estée’s Residence at JWT May Be Temporary Housing

After WPP Group bought Cordiant Communications Group and divvied up the company’s business among its own shops, the Estée Lauder account was parked at J. Walter Thompson. But since its relocation from Bates in September, the client has been quietly shopping for a permanent home.

Four New York-based agencies, including JWT, are pitching the $120 million business; the others are WPP’s Ogilvy & Mather, Interpublic Group’s Lowe and a unit of Omnicom Group’s TBWA (believed to be Brand Architecture International), a client rep confirmed.

Bates in New York primarily handled media planning and buying, but the company is said to be open to ideas on brand strategy, according to sources. The rep would say only, “We’re in the final stages of a review.”

The agencies presented strategic and media ideas to the New York-based client during several meetings in November and December, said sources. Some shops teamed with sister media agencies. BAI, for example, pitched with executives from OMD, sources said.

The shops are awaiting a decision. A 15-member Estée Lauder account team, now at JWT, is expected to follow the business. The contenders declined comment.

Several top execs at the cosmetics giant, including recently named CEO William Lauder and group president Patrick Bousquet-Chavanne, attended the presentations and will have a say in the selection, sources said.

Lauder, now chief operating officer, becomes CEO in July, succeeding Fred Langhammer, who will assume the new role of chairman, global affairs, the company said this month.

Bates had the account since 1994, inheriting the business from affiliate AC&R Advertising when that shop folded.

The Bates business encompassed most of the company’s brands, including Estée Lauder, Aveda and Clinique. Estée Lauder, which markets about 20 brands, rang up global sales of $5.1 billion in the fiscal year ended June 2003, according to Hoover’s Online. That was an 8 percent increase from the previous fiscal year. Year-to-year net income grew 67 percent to $319 million.

Estée Lauder’s chief competitors are L’Oréal, which markets L’Oréal and Maybelline products, and Revlon. For 2002, L’Oréal reported year-to-year sales growth of 23 percent to $14.9 billion, while Revlon’s sales fell 15 percent to $1.1 billion, according to Hoover’s.

Recent Estée Lauder marketing efforts include a print campaign for its two Intuition fragrances that ran in magazines such as Cosmopolitan and featured orange-hued portraits of bare-shouldered models. An ad showing a male model carried the headline, “The nature of man,” while another featuring Elizabeth Hurley declared, “The essence of a woman.”

The bulk of Bates was folded into other WPP shops, including JWT in the U.S. and Red Cell in Europe, and those shops absorbed Bates’ clients. JWT, for example, added $260 million in Pfizer consumer-healthcare brands and T. Rowe Price ($35 million).