Agency leaders and search consultants are painting a positive picture of the new-business marketplace so far this year. But Adweek research shows that the volume and aggregate dollar amount behind the business that went into play or shifted in the first five months of 2010 actually declined compared to the same period last year.
Through May, 73 accounts that collectively spend about $7.8 billion in major media annually either launched reviews or changed hands, down from 79 accounts spending $9.1 billion in the same period last year, according to Adweek research. (To compile its data, Adweek considered accounts that spent at least $20 million per year in media and counted reviews and shifts that were creative only, media only or both.)
"I don't want to say [it's] robust, but there's stuff out there," said Mike Duda, chief corporate strategy officer at Deutsch in New York.
Most of the opportunities, however, aren't huge. Prudential Financial, for example, is offering project work and AMC wants strategic positioning and media help but not creative executions. Indeed, while the volume of activity year-to-year is comparable, the dollars are down, in part due to a paucity of mega-account movement.
"Over the last few years, there were a disproportionate number of big media reviews and you only have so many of those to go around," explained American Association of Advertising Agencies' evp Tom Finneran, who sits on the 4A's new business committee.
"A lot of the big global players operate in waves," added Joanne Davis of Joanne Davis Consulting in New York. "So, if 2009 was big, 2010 will be smaller."
The biggest movers since January have been General Motors' Chevrolet ($50 million in revenue), which shifted to Publicis before heading to Goodby, Silverstein & Partners; Verizon Wireless ($25 million in revenue), which shifted to mcgarrybowen; and global creative duties on Johnson & Johnson baby products ($20 million), a review that's down to four finalists. Verizon also reviewed its non-wireless business ($15 million), which incumbent McCann Erickson retained.
A closer look at the data revealed clusters of activity in the insurance, automotive and retail sectors. Six insurance companies -- State Farm, MetLife, Aetna, Humana, 21st Century Insurance and American Family Insurance -- have made moves this year, suggesting either a chain reaction among competitors or, in the case of HMOs, a reaction to the new federal healthcare law. In its RFP, Aetna said it needed to strengthen its consumer-directed advertising "before health reform 'exchange markets' open in 2014."
While some are pleased by the volume of account activity this year -- as well as a 5 percent increase in U.S. media spending in the first quarter, as reported by Kantar Media -- few expect a linear turnaround in the marketplace, given still negative signs in the economy.
"There's definitely uncertainty," said Judy Neer, president of Pile + Co. in Boston. Added Finneran: "The consumer has hung in OK. But with unemployment still as high as it is, that's going to [be] a restraint on spending."