Lowe’s Moves to Shake Up Advertising Model By Launching Creative Review After 12 Years With BBDO

The move marks a significant break from the standard AOR approach

The chain spent $400 million on measured media last year. Lowes
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Today, home improvement giant Lowe’s confirmed that it has launched a full creative ad agency review. The news further threatens a significant piece of business for Omnicom, which has handled the account in the U.S. for 12 years.

In a move that marks a significant break from the standard AOR approach, Lowe’s now seeks multiple shops to handle its future campaigns. The Mooresville, N.C.-based business will be managing the review internally.

“As we continue to explore compelling and efficient ways to engage with consumers, we made the decision to evolve our agency business model to one where we can collaborate with a roster of creative agencies,” said a company spokesperson. “We believe this new approach will provide our team with the diverse thought, talent and capabilities needed to lead in a dynamic marketing environment.”

Regarding the incumbent agency, the representative added, “BBDO is participating in the review process to be considered as one of the firms on our roster of creative agencies. We are just beginning the bidding process and can share more details in the coming months.”

The RFP comes approximately 10 months after Lowe’s moved its U.S. media-planning and buying business to Publicis Groupe’s Starcom Worldwide; it had been with OMD for more than 12 years. In the middle of that review, the company abruptly replaced CMO Marci Grebstein with former svp and general merchandising manager of seasonal product Jocelyn Wong, who had run marketing for the Family Dollar chain before moving to Lowe’s in 2015.

According to two parties familiar with the matter, the procurement-mandated creative review had been in the works for more than a year. Client executives reportedly conducted an audit as part of an ongoing effort to reduce marketing expenses and found a disproportionate amount of the chain’s annual budget dedicated to traditional print and TV advertising. As part of a subsequent shift, BBDO’s recent efforts to promote the client have focused on digital platforms like Vine and Instagram Stories.

BBDO first beat out Deutsch, McCann and TBWA\Chiat\Day New York to win the creative business in a 2005 pitch that also saw the chain award its media business to fellow Omnicom shop OMD. Later, BBDO successfully defended the business in two procurement-mandated reviews.

Spokespeople for BBDO and Starcom deferred to the client for comment on the news. It is unclear which other agencies will be competing in the review, but the client’s statement implies that Lowe’s, like other big spenders such as General Mills, may end up hiring a group of smaller “boutique” shops to market its brands.

According to Kantar Media, Lowe’s spent approximately $400 million on measured media in the U.S. last year and $176 million during the first six months of 2017.

Erik Oster contributed to this report.

@PatrickCoffee patrick.coffee@adweek.com Patrick Coffee is a senior editor for Adweek.
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