The fallout from Campbell Ewald’s “Ghetto Day” email scandal continued this morning.
Following IPG’s announcement that CEO Jim Palmer has been fired, USAA cancelled its seven-year-old contract with C-E.
A client spokesperson said:
“USAA has given Campbell Ewald notice of contract termination. We will be searching for a new agency that aligns with USAA’s culture and core values.”
C-E won the business in 2008 based, primarily, on its past work for U.S. Navy (which eventually went to Y&R and led to an unsuccessful case before the U.S. Supreme Court).
The account had been with fellow IPG shop Deutsch, but USAA launched a review after naming a new CEO earlier that year.
The client did not directly address the email scandal, but the timing of the news and the quote above do suggest that this was the reason for its decision to terminate the contract.
IPG tells us that it will retain the business via a soon-to-be-formed entity separate from Campbell Ewald San Antonio.
From a holding company spokesperson:
“USAA remains a valued IPG client. We plan to transition our USAA team into a standalone, purpose-built entity over the next few months, so as to assure continuity in the outstanding, business-building programs we deliver for this client.”
When C-E first won the business, USAA counted nearly 7 million members in the U.S. Its current membership is 11.2 million–and back in 2008, TNS Media Intelligence reported that USAA spent approximately $15 million on advertising annually.