Ogilvy & Mather mulls life after fast food By David Kile

NEW YORK--Ogilvy & Mather, which two weeks ago was in the restaurant business with Hardee's and Shoney's, now finds itself with an empty plate as both chain

As if those losses weren’t too much to digest in one week, the agency’s troubled Houston office now finds itself defending its $7 million SkyTel account.
Last week’s loss fits a pattern of ups and downs for O&M’s U.S. operations. In the course of the year, it has lost accounts that were significant to three of its offices in the U.S.: Sears Apparel from the Chicago office; Electronic Data Systems from its Houston office and Hardee’s from New York. However, the agency has managed to rack up some $110 million of billings increases and new assignments over 18 months from existing clients, such as Chesebrough-Pond’s and American Express, along with a few pieces of new business.
Still, at O&M South (formed last spring by combining the Atlanta and Houston offices after EDS fired the O&M/Houston shop in favor or Goldsmith/Jeffrey, N.Y.), there will be a definite fallout of personnel from the Shoney’s loss. “We are going to have to let some people go,” said O&M South president Neill Cameron. And while O&M/N.Y. will handle Hardee’s until the end of the year, one Ogilvy executive said there would certainly have to be a layoff, coming primarily from the media department, unless some new business for New York offsets the loss of some $9 million in revenue.
O&M/N.Y president Shelly Lazarus said that a layoff may be averted because O&M’s media department has been out soliciting small ad agencies in a bid to buy media for those agencies. The agency has already signed Fitzgerald & Co., Atlanta, and Lazarus said the agency is close to announcing a deal with another shop. These deals could compensate in part for the loss in billings from Hardee’s.
Lazarus also said the agency would be reluctant to break up its fast food team so quickly in case another restaurant account comes up. “It is a group with a lot of experience and talent,” said Lazarus.
At the urging of Martin Sorrell, said one O&M executive last week, the Chicago office is being positioned to pitch the creative portion of the account to try and stay in Hardee’s den. With lower overhead in Chicago, that office could better afford what was not a profitable account in New York, even with all the media.
Copyright Adweek L.P. (1993)