Scenarios Emerge as Lowe Braces for Final Fate on Mercedes
NEW YORK–With Mercedes-Benz of North America poised to pull its estimated $125 million ad account from Lowe & Partners/SMS, industry speculation swirled last week over where the prized business might land.
The Montvale, N.J., automaker is looking to make the switch as “nondisruptive” as possible, sources said, indicating that it may forgo a full-blown review.
Last week, many signs pointed to Omnicom Group, which controls the bulk of business from Mercedes parent DaimlerChrysler. Some of its units, such as Rapp Collins, already handle the Mercedes brand.
Mercedes chief executive Michael Jackson would not comment on Lowe’s status or a midweek meeting he attended with marketing chief Joe Eberhardt and Lee Garfinkel, Lowe chairman and chief creative officer, where the client voiced its concerns to the agency.
Mercedes cited the General Motors business at other IPG shops as a potential conflict, but sources said that issue is a screen to take the focus off of the departure of Lowe’s Marvin Sloves as the driving factor in the client’s dissatisfaction.
Jackson, on the recommendation of Chrysler marketing chief Jim Holden, is said to have approached Omnicom chief executive John Wren about a move, with scenarios that included TBWA/Chiat/Day and BBDO.
Others say a possible outcome could involve a spinoff agency for Mercedes and Sloves, as well as Lowe’s core account and creative team. Under that arrangement, contractual issues could pose a problem and any number of non-compete clauses would need to be addressed. Interestingly, Sloves is still under contract as a consultant to Lowe on Mercedes although that relationship has been rocky since he was pushed out in December.
Wren said he had not been in touch with Mercedes or Sloves about the Lowe account. A BBDO executive also said the New York agency had not been contacted.
Lowe, Mercedes and IPG declined comment.
Another wild card: DaimlerChrysler’s much-rumored interest in Nissan could add a new nameplate to its portfolio and TBWA/C/D to its circle, another plus for Omnicom.
Lowe, which has won numerous awards, has been given much credit for the brand’s success. Mercedes car sales in the U.S. jumped 38.2 percent last year. –with staff reports
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