Client Resets Brand Spend; Open to Agency Consolidation

Sara Lee’s top global marketer said he would like the company to work with fewer shops, but that any consolidation is up to individual brand executives.

“In a broad sense, we’d like to be more important to fewer agencies,” said Lee Chaden, evp of global marketing and sales at the Chicago-based company. “My view is, as a general vision it would be desirable.”

Sara Lee works with six agencies in the U.S. The once- decentralized conglomerate in the last several years has made an effort to “[break] the history of being a collection of companies,” a client representative said.

Chaden last month laid out a plan to divide brand spending into four categories. “We want to make sure we’re putting resources behind the brands that have the most potential to drive the growth,” he said.

The four-tier brand-spending strategy includes research and development and capital investment, as well as marketing. Chaden declined to specify how spending will be reallocated, but he said overall spending “will not change dramatically.

“We had been behaving in a rational way prior to this initiative,” he said.

“Strategic investment” brands, the top tier, “will receive a disproportionate level of marketing spending,” the company said. Money for those and for brands in the second, “support and grow” category will come from ones in the fourth, “manage for cash” tier. Brands in the “sustain” category are often regional products or otherwise limited in growth potential.

Among the top-tier brands is Sara Lee’s new coffee maker, the Senseo, which will debut late this month with ads from Omnicom Group’s BBDO in Chicago.

Analyst Andrew Lazar of Lehman Brothers in New York gave Chaden’s segmentation plan a thumbs-up. “This is the first detailed, focused look [for Sara Lee] across the portfolio to see what brands deserve a disproportionate amount of spending and what deserves less,” Lazar said.

The plan follows the late January consolidation of Sara Lee’s $220 million media business at Publicis Groupe’s Starcom in Chicago. Sara Lee also has made two agency changes, moving Ball Park Franks and Jimmy Dean from Publicis’ Leo Burnett to Omnicom’s TBWA\Chiat\Day in Playa del Rey, Calif., then last week shifting Hillshire Farm from Havas’ Euro RSCG Tatham Partners to Omnicom’s Element 79 Partners in Chicago.