Shop Seeks New Business After Olds Pulls Its Promotions Account
DETROIT-Frankel & Co. executives here plan to keep the agency's Southfield, Mich., office open despite the loss of promotional work for General Motors' Oldsmobile division.
Jim Mack, president and chief executive officer of the Chicago-based agency, joined Rex Smith, president of Frankel Detroit, to break the news to employees last week about the Olds account, the Southfield office's chief assignment.
Smith said it was too soon to say whether layoffs would be necessary. "Of course, we'll configure the office to be efficient," he said. While Olds is the only account Frankel services here, executives are talking with a range of other potential clients and going after new business with "renewed focus and vigor."
Sources estimated promotional spending by Olds at $5-10 million. Both Olds and Frankel declined to comment on spending.
Frankel opened a Detroit-area office two years ago in temporary quarters in Troy, Mich. At that time, Olds was still headquartered in Lansing, Mich., about 90 minutes west of Detroit. The Southfield office opened last May with about 25 employees and has since grown along with the amount of Olds business.
The 38-person office will continue to work on Olds for the next 180 days, as called for in the contract, said Mike Sands, Olds advertising director. But the division will "immediately migrate certain projects," he said.
The assignment is being shifted to Olds national agency Leo Burnett, Chicago, which will handle it through its Northstar promotions unit, Sands said. Boston-based Bronnercom, which does relationship direct marketing for Olds, will pick up an undetermined amount of former Frankel business as well, he said.
The decision to move the business came after Olds conducted an internal review of its agencies nationally and locally, Sands said. The review was prompted by the reorganization of GM's marketing and the formation of GM Eventworks and R*works, two units which now coordinate GM's promotional activity in each of its new regional marketing offices.
Shifting the assignments back to Burnett, which had them before the move two years ago, "gives us one-stop shopping for all marketing solutions and allows us to work more seamlessly across all of those resources and gives us more of true partner and integrator," Sands said. "So we alone don't have to be integrators of the marketing, we can rely on Burnett to be the integrator of the ideas, as well." ƒ