$570 Mil. Wal-Mart Decision Could Come This Week
CHICAGO A decision in Wal-Mart's search for an agency to handle its $570 million advertising account could come as early as this week, according to sources. The two agencies vying for creative duties, IPG's The Martin Agency of Richmond, Va., and WPP's Ogilvy & Mather in New York, presented on Dec. 22, while those competing for the media duties—WPP Group's Mediaedge:cia, Aegis' Carat and Publicis Group's Mediavest—presented on Dec. 21 and 22. The review is the Bentonville, Ark., retailer's second go-round in a search for a new shop after awarding its account to IPG's DraftFCB in November, only to fire the agency—along with two executives who led the search—a month later. The company's incumbent agencies, Omnicom's GSD&M in Austin, Texas, and Kansas City, Mo., independent Bernstein-Rein, did not participate in the latest round of presentations. GSD&M was invited to pitch again, but declined, saying, "We helped build Wal-Mart from $11 billion in sales to $312 billion. We declare victory. ... We wish our great friends well. And we are moving on."
Publicis Expands Digital Assets With $1.3 Bil. Digitas Acquisition
NEW YORK Publicis agreed two weeks ago to acquire Digitas for $1.3 billion in cash, a move that will greatly expand the French holding company's digital marketing capabilities. The deal calls for Publicis to pay $13.50 for Digitas' shares, a 23.5 percent premium on their closing price. The acquisition represents the boldest move yet by Publicis CEO Maurice Lévy to bolster the company's offering in marketing services. The holdings of Boston-based Digitas include its namesake agency, along with interactive shops Modem Media and Medical Broadcasting Co. The company is on track to produce overall fee revenue of approximately $390 million. Said Lévy, "We see that this market is buoyant and the market is moving to the digital era. The fact that we have now with us Digitas is something that will help us a great deal to help our clients move to the digital space." Digitas CEO David Kenny will stay on after the deal closes and join Publicis' executive committee. See related story on page 5.
IPG Search for Creative to Lead Buick in L.A. in Final Stages
LOS ANGELES IPG's search for a new creative chief here for its Buick account is in its final stages, according to sources. At least one creative director was interviewed in New York the week before Christmas, and no more than three finalists remain, sources said. The plan is to install a creative chief to oversee Buick at McCann Erickson here, though most of the people on the account would remain at the agency's office in Troy, Mich. A decision is expected as early as this week, though sources said the announcement could be delayed for a few weeks.
Gold, Furth Will Helm DraftFCB Spin-off Agency
CHICAGO IPG is set to create a spin-off agency to handle client conflicts brought about by last year's merger of Draft Worldwide and Foote Cone and Belding. The shop will likely handle clients such as Qwest and CVS, as well as oversee some work handled by promotions agency Zipatoni, according to a statement from the holding company. The new shop, which is still unnamed, will be led by Yvonne Furth and Lor Gold, who had been president and chief creative officer, respectively, of Draft Chicago.
Burnett Wins Creative Duties On $40 Mil. Herbal Essences
CHICAGO Procter & Gamble has moved its North American Herbal Essences account to Publicis' Leo Burnett here without a review. Burnett had previously handled the brand outside of North America, and the move consolidates the account at one shop, according to the Cincinnati client. The business had previously been with Publicis' Kaplan Thaler Group in New York. P&G spent just over $40 million on U.S. ads for the brand over the first nine months of 2006, according to Nielsen Monitor-Plus.
2006 Holiday Sales Are 'Soft'; Luxury Strong, but Apparel Lags
NEW YORK A report released last week by MasterCard Spending Pulse characterizes overall sales during the holiday season as "soft," continuing a trend of decelerating growth that began in the second quarter. Electronics and higher end/luxury retail sales were generally stronger than the national average, but apparel sales lagged. Spending Pulse reports are based on aggregated sales activity of the MasterCard U.S. payments network, coupled with estimates on other payment forms including cash and check. Spending estimates are for the holiday season from Black Friday through Dec. 24. The report finds the retail economy is still growing but at a slower pace than it has grown for the past two to three years.
Burnett and Arc Reorganize In Effort to Work More Closely
CHICAGO Publicis' Leo Burnett and Arc Worldwide are overhauling their management structures to bring the two networks closer together. The move, which had been expected [Adweek, Nov. 20], includes consolidating both brands under one P&L in the U.S. and new or expanded assignments for some key executives, including U.S. president Rich Stoddart and Latin American president Juan Carlos Ortiz, who will become co-presidents of the network's North American operations. Additionally, Arc Worldwide president Marc Landsberg will leave the shop early this year.
Audi's $100 Mil. Global Account Goes to Independent Venables
DALLAS Audi of America selected San Francisco independent Venables, Bell & Partners to handle creative chores on its ad account following a review, the client confirmed. Estimated billings are $100 million. The 13-year incumbent, Havas' McKinney in Durham, N.C., and Publicis-backed Bartle Bogle Hegarty in New York were also finalists. (Another contender, Publicis' Fallon in Minneapolis, exited the contest last month.) The review follows the May appointment of former Mercedes executive Scott Keogh as the company's chief marketing officer. At the time of the win, Venables employed 100 people and claimed less than $200 million in total billings. The agency partnered with Palisades Media in Santa Monica, Calif., on the pitch.