Multiple sources tell us this morning that McDonald’s has finally resolved its agency review after more than four months by consolidating its ad business with Omnicom. That means DDB will be creative agency of record on the account moving forward.
According to our sources, Leo Burnett got the word this morning that it would no longer be working on McD’s immediately before DDB received a call confirming the win at approximately 10:45.
Following the win, Omnicom will launch a still-unnamed unit dedicated to servicing the McDonald’s account in Chicago. According to sources with direct knowledge of the matter, DDB will join forces with several Omnicom media agencies including Annalect, sparks & honey, Critical Mass and others.
A statement from DDB North America CEO Wendy Clark:
“Exactly 18 weeks ago today, we received a dream brief from one of the most iconic brands in the world… to create ‘the agency of the future.’ The best and the brightest talent across multiple Omnicom agencies came together over the last 4 months to create, operationalize and deliver on that brief. The result is a customized agency built with intelligence at the core, to fuel brilliant creative work, that’s delivered at the speed of the marketplace at an efficient cost. We are thrilled and honored to be selected and excited about immediately creating impact for McDonald’s business.”
The timing of the decision confirms reports we received last month stating that the client would notify the agencies involved at the very end of August/beginning of September. It also follows a controversial report on the claim that McDonald’s made “unusual financial demands” on its potential agency partners. Multiple parties told us that the chain had insisted that its future agency partners work at cost, with all profits tied to unnamed performance goals. The review also included multiple briefs and a particularly strict conflict clause. According to our sources, these demands led WPP to drop out of the review in May.
Kantar Media’s data indicates that McDonald’s spent approximately $820 million on U.S. measured media in 2015 and $195 million in the first quarter of 2016. Both numbers mark a decline from 2014’s $936 million total.
Representatives for McDonald’s have not yet responded to our requests for comment. DDB deferred to the client, and a Leo Burnett spokesperson provided the following statement marking the end of the agency’s 35-year relationship with the Golden Arches:
“While this news is certainly very disappointing, we’re extremely proud of the Power of One thinking we brought to McDonald’s. The work we’ve done over the years for McDonald’s has been nothing short of spectacular, and we are particularly proud of having been partners throughout their business turnaround. We wish them continued success.”
This post will be updated throughout.