AT&T Now Says That Omnicom Had an Edge in $2B Review

By Patrick Coffee 

Last Friday saw the end of one of the biggest agency reviews in months as AT&T consolidated its creative and media accounts with Omnicom’s BBDO and Hearts & Science.

Now, in the wake of the $2 billion decision, we hear conflicting accounts about how the review went down.

Several parties have noted that AT&T hired former BBDO New York managing director Fiona Carter as its head of advertising last October in hinting that her history with Omnicom would give that holding company an advantage in the review.

Others seem to disagree. Grey North American CEO Michael Houston‘s internal memo implies that WPP truly didn’t know until the last minute that it would lose the business. We hear from various sources that Sir Martin Sorrell is particularly upset about the decision. This would make sense given that, according to Pivotal Research analyst Brian Wieser, it will cost the WPP network $100 million in revenue and shave an entire percentage point off the holding company’s bottom line. Omnicom is a slightly smaller company, so Wieser thinks its windfall will probably be greater than 1%.

Sources also tell us that WPP was particularly confident on the media side—so much so that MEC leadership positioned the win as a sure thing and even implied that resignations might follow a loss.

Today AdAge ran a Q&A with Carter and AT&T senior executive VP and global CMO Lori Lee, who countered both of those narratives. According to the executives, it was Hearts & Science that gave Omnicom a “slight” edge. Lee says that the team on that side did a good job illustrating how the services of BBDO and Hearts & Science would complement each other, saying “They had great chemistry, insights and meeting of the minds.”

So it was all about digital and data, then?

Yes. Later in the Q&A, Lee hints at a foreseeable shift away from broadcast campaigns, focusing on mobile and targeting. Carter then tells AdAge that AT&T must “be more culturally relevant, more entertaining and more modern” in taking its marketing efforts beyond the TV screen.

AT&T will of course continue making :30 and :60 spots for live commercial breaks, and this pivot is not a surprise. But to us, the top marketers’ statements strongly imply that AT&T, like Verizon, aims to own the “content,” the ads that support it and the technology that helps target those efforts to the right consumers. And unlike P&G, AT&T doesn’t seem particularly bearish on Facebook’s targeting capabilities.

Maybe we should all get ready for more sponsored clips and more 30 minute commercials.

 

[Pic via AT&T]
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