More than one McDonald's insider said the company, which has whittled its agencies from 60 to around 30 in the past decade, wants to have a short list of regional agencies to work with by the beginning of 1994. They cite efficiencies in coordinating national promotions and cost savings in placing more local media dollars.
The push is related to McDonald's shifting more money behind national promotions through one of its two national agencies Leo Burnett Co. and DDB Needham Chicago.
"This is happening right now," said one McDonald's source. "Ideally, they'd love to have it pared down by the end of the year."
If McDonald's has its way, between 10 and 12 of the company's largest regional agencies would pick up substantially more business by the end of the year. That list would most likely include Arnold Fortuna Lawner & Cabot/Boston; Davis Ball & Colombatto, L.A.; Fahlgren Martin/Parkersburg, Va.; Glennon Cos., St. Louis; Moroch & Associates/Dallas; and McCann-Erickson's Universal Group, which handles the largest portion of local billings for McDonald's.
While not confirming the existence of an agency shortlist, McDonald's senior evp/chief marketing officer Paul Schrage said the company has cut the number of local agencies in half from 80 in 1986, but noted that "10 agencies now account for more than 80%" of local ad billings. The consolidation of agencies is similar to the consolidation that the fast-food giant has undertaken with other suppliers, he said.
Copyright Adweek L.P. (1993)