Industry Update Volume 15

Executive Summary – Monthly Recap:

Rosé or Pastis anyone? This is the time of the year when the “who’s who” of advertising gathers in the sunny city of Cannes for its annual International Festival of Creativity to recognize the best campaigns, clients and agencies. With 15,000 delegates from around 100 countries, this is the advertising event you don’t want to miss. We will keep an eye on the results. The U.S. elections are fueling massive advertising investments, which is good for the industry. Google and Facebook continue to dominate the digital advertising space: they both collect an estimated 85 cents of every new dollar spent. Digital video is a fast growing category. Facebook says videos are driving 13.2 times as much chatter as they did a year ago, with 100 million hours of video being viewed daily. And 68% of the marketers think original digital video will become as big as original television within the next three to five years.

Newsworthy reports and recent developments:

At AMS, we approach the agency management discipline as four distinct but complementary practice areas – Talent, Work, Financials, and Performance and Value— which is how we categorize the following developments:

TALENT: securing the right talent and resources

Should brand advertisers all hire a chief media officer as the internal SME on the many important and often complex media issues confronting advertisers today? Do they need a centralized resource to manage supplier efficiencies through the media supply chain? This is the question raised by Bill Duggan, group EVP at the Association of National Advertisers. Recent media issues include transparency, media agency contracts, opt-in agreements with media agencies, programmatic buying, content marketing and fraud in digital advertising, as well as viewability in digital advertising, native advertising, sourced traffic /audience extensions, connected TV, addressable TV, influencer marketing and ad blocking.

• Microsoft acquired LinkedIn for $26.2 billion, giving the software giant better targeting and extended reach to LinkedIn’s 433-million-strong audience.
• Google launched an enterprise marketing platform, Google Analytics 360 Suite, aimed at directly competing with similar offerings from Adobe and Oracle. The suite, which helps brands better understand their audience in a multiscreen world, includes Google Analytics Premium, Adometry, Audience Center 360, Optimize 360, Data Studio 360, Tag Manager 360, Analytics 360 and Attribution 360.
• New Zealand shop Barnes, Catmur & Friends has been acquired by Dentsu Aegis Network. The agency offers a wide range of capabilities including creative, digital, design, direct response and media.
• Deloitte purchased creative shop Heat, closing on its 11th digital marketing firm acquisition since 2012, the same year it launched creative consulting unit Deloitte Digital. Following suit, other consulting firms like IBM and PricewaterhouseCoopers are also buying up creative shops, moving deeper into Madison Avenue’s territory.
• Yahoo promotes Storytellers, its content marketing studio for brands and agencies, which gives them access to the company’s editorial team as well as its 165 billion daily data points and native-like advertising through Yahoo Gemini, the company’s marketplace for native and search.
• Havas Group and Atom Factory joined forces to launch a brand innovation consultancy shop called Smashd Brand Innovation, working with clients like TD Ameritrade. The new entity aims at bridging cultural trends and technology.
• Dentsu Aegis acquired digital marketing shop Cardinal Path as it looks to build its analytics offering, specifically digital analytics, user experience, and search and performance. The shop has been managing Google’s Global Partner Academy, a program that provides training sessions to Google Partner agencies.
• Publicis Groupe SA is slimming down its media business by merging some of its ad-buying shops and consolidating ad purchasing at Publicis Media.
• MEC has unveiled a worldwide specialist content unit called Wavemaker that brings together content strategy, social, SEO, creative, and partnerships and experiences.
• Goodby Silverstein & Partners has become StubHub’s new global agency of record following a review, replacing incumbent indie shop Duncan/Channon. GS&P is tasked with redesigning the brand for the eBay-owned marketplace for online ticket sellers and buyers.
• Dentsu Aegis Network unveiled U.K. digital shop fortysix (named after the average number of human chromosomes), an agency with talent chosen based on youth and diversity.
• Edelman and United Entertainment Group have teamed up to create a talent agnostic global influencer and brand partnership named Starling. The new entity merges the talent identification and contracting expertise of UEG with Edelman’s creativity, distribution, and paid media strategies and analytics capabilities.
• GroupM has launched a new Minneapolis-based agency called Team Arrow Partners for its Target client that will handle its $500 million media business. The agency will also tap into the WPP media agency network’s resources in the U.S.
• Sprint creates a new internal agency called YellowFan Studios, a move that comes as the company works to cut costs across the board (the company wants to cut costs by $2.5 billion). The agency is expected to be 60 people strong and has full creative responsibility for providing film and print production, design and all other creative services. Deutsch remains the agency of record for general market advertising and Alma the agency of record for Hispanic advertising.
• Challenging the traditional system for finding service agencies (RFPs), a new business matchmaking company called Agency Geek uses an algorithm created by computer engineers to match clients and agencies using a 28-question survey clients fill out on what they are like to work with and what they want from a potential client.
•  Bringing production in-house, especially digital content production, is a growing trend for brand advertisers like Sprint and its newly formed internal agency called YellowFan Studios.
• WPP has merged Blue Hive, Team Detroit (created in 2007 to combine JWT, Ogilvy, Mindshare, Y&R and Wunderman) and Retail First to create Global Team Blue as a means to emphasize the agency’s unified global services model. GTB will work across 49 offices on six continents, with clients such as Ford and Purina. Hudson Rouge, the agency dedicated to Ford’s Lincoln brand, will retain its name.
• Intel has been building up its in-house creative capabilities with storytelling unit Agency Inside and commercial production team Intel Global Production Labs.
• Noteworthy quotes:
  • “I believe very strongly that intelligent applications will fundamentally change the way you do work in the enterprise and the way to collaborate with your trading partners.” Bill McDermott, CEO, SAP
  • Mad Men protagonist Don Draper would be utterly out of place in the modern advertising agency.” Martin Sorrell, CEO, WPP
  •  “We’re seeing an increasing number of briefs coming from multinational clients looking for different types of services to be included in our responses. … Having a single team leader familiar with all of the people and capabilities across agencies increases the opportunity of winning new business.” John Wren, CEO, Omnicom

WORK: producing great work and outcomes

According to AdAge’s Agency Report 2016, “Agencies are hiring, their stocks have been climbing and revenue is rising as digital drives growth across the spectrum of disciplines.” U.S. agency revenue increased 6.5% to a record $46.8 billion in 2015. Revenue for U.S. agencies grew 6.5% to a record-breaking $46.8 billion last year and digital accounted for more than 40% of that revenue, according to Ad Age Datacenter. In 2015, Adland’s Big Five — WPP, Omnicom, Publicis, Interpublic and Dentsu —completed more than 100 acquisitions and investments (the biggest: Publicis’ $3.7 billion purchase of Sapient).

• According to a report from eZanga on how audiences interact with digital ads, 75% of respondents said they click on ads usually by accident; 7% are using AdBlocker software; and 28% are most receptive to social media advertisements.
• The ANA and its Alliance for Family Entertainment are looking to eliminate bias against women from advertising and media, launching #SeeHer in an effort backed by the White House and tracked by ongoing consumer surveys.
• Facebook has created an online platform called Creative Hub for brands and agencies to create ads for Instagram and Facebook in a bid to simplify creation of ads. The new hub enables brands to test different ad formats, research best practice and tips, and work on real-time campaigns with colleagues globally.
• JetBlue Airways teamed with OutFront to create the first-ever digital billboard that links to mobile for real-time messaging and social conversations.
• To launch German rapper Kontra K’s latest album “Labyrinth,” Unit9 Digital/Films created an interactive film, “Next To You,” which allows fans to jump between the past and the present so that they can uncover clues to solve a murder mystery. Clues are hidden in the video, either in the past or present. Viewers are encouraged to tap their phone or press the spacebar on their keyboards. The video gives the opportunity to follow two different stories and can have three different endings.
• Google is taking further steps to diversify its static display business away from standard units — particularly on mobile — in favor of “native ad units” that fit more seamlessly into app and mobile web publisher designs. Marketers are asked to furnish an image, text and a URL, and Google will dynamically format the ads for a wide range of native formats.
• According to AdAge, here are the 10 buzzwords most often heard at events at La Croisette in Cannes this year: Disintermediation, native music, crowd culture, artificial intelligence, value exchange, virtual reality, bots, prototyping, purpose and human. Make note as you are likely to hear those again frequently in the coming months.
•  Snack maker Mondelez International is taking a new approach to media buying by actually partnering with studios and others on content creation, similar to PepsiCo. PepsiCo’s new state-of-the- art content studio, dubbed Creators League, pumps out branded content while also pursuing distribution deals with film studios, online publishers and other outlets for brand-agnostic content.
• Noteworthy quotes:
  • “I think what you see going on in the PR industry is much tighter integration. We’re moving toward earned centricity and will see PR continue to rise.” John Clinton, North American head of creative and content, Edelman
  • “It’s not about selling, it’s not about teaching. It’s simply engaging.” Jamie Moldafsky, CMO, Wells Fargo
  • “Great marketing isn’t about one ad, one piece of content, one moment in time. … It is about a relentless and lasting commitment to a brand’s story.” Susan Credle, global chief creative officer, FCB
  • “There’s no algorithm for COOL.” Mike McCue, CEO, Flipboard
  • “We’ll know that the job is done when every CMO and every agency CEO associated with the ANA never produces an ad that diminishes the role of girls or women in our society.” Bob Liodice, CEO, ANA
  • “The best UI is no UI.” Stefan Moriz, VP of customer experience, Veryday

FINANCIALS: driving efficient use of resources

The most significant financial-related issue of the past few months is the release of the seven-month study commissioned by the ANA revealing that senior executives across the agency ecosystem were aware of, and mandated, some non-transparent business practices. The results of the study stem from 143 confidential interviews with 150 individual sources representing “a cross-section of the U.S. media-buying ecosystem.” Major agencies such as GroupM, Omnicom, Publicis and Interpublic Group of Cos. are disputing the report findings. Per senior analyst Peter Stabler: “Although the report highlights some rebate activity in the U.S., most experts don’t expect a material impact on advertisers and agency relationships or agency financial results. … The vast majority of large advertisers have already taken action to tighten scrutiny of media agency conduct — including built-in audits and tighter contract language.”

• Key findings from the ANA study on media rebates:
• 1) Fundamental disconnect in the industry regarding the basic nature of the advertiser-agency relationship. 2) Substantial evidence of non-transparent business practices in the U.S. market in the form of rebates. 3) Substantial evidence of potentially problematic agency conduct concealed by principal transactions. 4) Evidence of non-transparent business practices in the U.S. market arising from agencies holding or soliciting equity stakes in media suppliers. Full report can be downloaded from the ANA at: www.ana.net/content/show/id/industry-initiative-media-transparency-report.
• Fraud case: Former ad executive Bill Grizack has been sentenced to 57 to 81 months in state prison for defrauding The Variable and McKinney with fake client contracts, including one with McDonald’s, to gain partnership status.
• Samsung, the South Korean electronics giant, announced it would be investing $1.2 billion into the United States, specifically around the Internet of Things market.
• WPP last year pumped $1 billion into advertising on Facebook on behalf of its clients, up from $650 million in 2014. WPP this year expects to place more than $5 billion in advertising with Google, its biggest media relationship.
• McDonald’s Corp. is reviewing its consolidated U.S. creative account, inviting holding companies Omnicom Group and Publicis Groupe, owners of its existing shops (DDB and Leo Burnett, respectively), as well as WPP. Yet less than two weeks later, WPP withdrew from the contest without explanation. AdAge reported that the terms of the pitch might be the reason: the RFP stipulates that the agency will operate at cost, essentially breaking even. There is the potential for some profit incentives should the shop meet certain market metrics (likely sales-based) but also more subjective metrics established by McDonald’s. The brand is also insisting on a restrictive conflict clause — that any agency in the pitch cannot have conflicts in food retail, including convenience stores. The scope of spec work goes well beyond what’s typical in a pitch — especially one in which the turnaround is only 60 days.
• Noteworthy Quotes:
  • “We target $150-200 million per year for acquisitions. There aren’t any big holes in our offering, so we think of them as additives to what we already have.” Michael Roth, CEO, Interpublic Group
  • “The ANA has failed its members, advertisers, agencies and the entire industry by releasing a report that relies on allegations about situations involving unnamed companies and individuals to make broad, unsubstantiated and unverifiable assertions.” Publicis Groupe
  • “Here at IPG we do not accept rebates in the U.S., nor do we believe rebates should be part of U.S. market practices. Additionally, IPG does not buy ‘inventory media,’ where we pre-purchase media on our own account and re-sell it to clients – this decision has been a point of differentiation for our company.” Interpublic Group of Cos.
  • “GroupM does not seek, nor accept, rebates or hidden revenues in any form from media partners in the U.S. Nor do we accept service fees from vendors that are not disclosed to clients. GroupM is straightforward with clients concerning our proprietary media products and the value they provide; clients always exercise an informed opt-in to participate.” WPP
  • “The current way of being compensated is misery, and it’s unfair, because we are compensated for time, and what we are bringing has more value than time.” Maurice Levy, Chief Executive, Publicis Groupe

Update on holding company financials:

• WPP: WPP has posted like-for-like net sales up 3.2% for the first quarter of 2016, with revenues up 5.1% to $4.7 billion, boosted by a strong performance in the U.S. — where sales were up 3.9%, revenues grew 6.9% to $1.8 billion and new business wins included Wendy’s, Target and Jet.com. WPP made 26 acquisitions in the same period. Its horizontal teams already account for one-third of WPP revenue, with 38,000 employees working on 45 cross-agency account teams for clients including Ford, Procter & Gamble, Vodafone, HSBC, Unilever and Chanel.
• Havas: Havas reported 3.4% organic growth in the first quarter of 2016, to $571.1 million. Organic revenue grew by just 1.2% in the U.S. Overall, Havas reported $889.4 million in net new business for the first quarter of 2016.
• Omnicom: Net income increased 4.4% during the quarter, to $218.4 million, compared to the same period last year. The company’s worldwide revenue in the first quarter increased 0.9% to $3.5 million from $3.47 million. Organic revenue, excluding one-time factors such as acquisitions and external forces such as currency fluctuations, increased 3.8% in the first quarter of 2016.
• IPG: Interpublic Group of Cos.’ revenue increased 3.9% to $1.74 billion in the first quarter of 2016 compared to the same period last year. Organic revenue excluding one-time factors such as acquisitions or currency fluctuation rose 6.7%. IPG achieved 12% organic revenue growth across its top 20 clients by providing them with integrated services across multiple disciplines, such as PR, experiential marketing and media. Operating income was $20.9 million, compared with operating income of $7.8 million a year ago. Operating margin was 1.2% for the quarter, compared to 0.5% a year earlier. Net income was $5.4 million during the first quarter, compared to a net loss of $1.8 million for the period last year. The company slightly beat expectations of $1.71 billion in revenue.
• Publicis: Publicis Groupe reported revenue of $2.3 billion and organic growth of 2.9% in the first quarter of the year, driven by new business and a strong performance by Sapient. Including acquisitions, growth reached 8.9%. Agency is cautious about the next two quarters of this year due to the loss of its longstanding Procter & Gamble multibillion-dollar media business to rival Omnicom Group.

PERFORMANCE AND VALUE: driving stronger performance and value from the partnership

Brands and agencies are entering a new world. 60% of executives say their roles and remit have changed since 2014, per Forbes Insights and Oracle Marketing Cloud. Executives said that the biggest barriers to more effective collaboration between agencies and clients are insufficient results reporting and a lack of marketing technology skills. Agency specialties are increasingly blending in some areas: in taking the top prize for PR at the Cannes Lions, creative shop Forsman & Bodenfors, through “The Organic Effect” campaign for Swedish supermarket client Coop, shows that once again creativity leads to breakthrough thinking, including in PR.

• Three new Cannes Lions were introduced this year: 1) Digital Craft (recognize and celebrate the skill and artistry required in Omni- channel digital creativity). 2) The Entertainment (re-examine what it takes to cut through and connect, converting consumers into fans and content into culture). 3) The Entertainment for Music (recognizes and celebrates the creative production, promotion and distribution of content with music at the core).
• Per Debra Giampoli, director of global strategic agency relations at Mondeléz International, the brand has been experimenting with new approaches (now called Fly Fearless) to working with agencies: 1) Project Meteor — a focus on smaller brands through an accelerated 10-week timeline that stresses creativity. 2) Project Sprout — an emphasis on global brands by working with multiple agencies at once, while using small teams and linking advertising to short-term sales results. 3) Fly Garage— a new approach to innovation brought together diverse talent to strategy sessions. Fly Fearless is a mindset or a way of collaborating that is as much about the individuals on the team as it is about the partner agencies involved.
• Korean company Samsung Electronics is named Creative Marketer of the Year at this year’s Cannes Lions Festival of Creativity, replacing last year’s winner Heineken.
• Cannes International Festival of Creativity (Cannes Lions) — a few examples of Grand Prix winners:
  • Creative Effectiveness: U.K. retailer John Lewis’s holiday blockbuster “Monty’s Christmas,” handled by Adam&Eve DDB London. The ad combined a great spot and in-store experience using 3D technology. The results: 32 million views, revenue growth of 132 million pounds.
  • Mobile: New York Times’ T Brand Studio VR work, handled by The New York Times T Brand studio and others for production, including VR studio VRSE.works.
  • Media: McWhopper campaign from WPP’s Y&R New Zealand. The campaign asked burger enemy McDonald’s to make peace with Burger King by creating a combination Whopper and Big Mac, creating mass media interest for the story.
  • Creative Data: ING’s “The Next Rembrandt,” handled by J. Walter Thompson Amsterdam. The agency analyzed the works of artist Rembrandt using data to recreate his techniques, such as brush strokes, ultimately creating a “new” masterwork — 347 years after his death.
  • Cyber: Anuncio Loteria de Navidad’s “Justino,” created by Leo Burnett Madrid, was born out of digital with every piece of the story perfectly crafted, yet different and interesting, for its cyber channel (Instagram, Facebook, etc.).
  • PR: Swedish supermarket company Coop’s “The Organic Effect” campaign by Swedish creative shop Forsman & Bodenfors studies and documents what happens to the members of a family, and their bodies, when they switch from conventional food to organic food.
  • Innovation: AlphaGo, the Artificial Intelligence Computer System by Google DeepMind, beats Grandmaster at Game of Go, an ancient game that is much more complex than chess with more than 200 possible moves for every turn. The technology applies deep learning, in a style that is closer to intuition than brute force.
  • Pharma: “Breathless Choir,” from Ogilvy London and its client Philips, tells the story of a group of people whose breathing disabilities had gotten in the way of their love of singing and how they overcame it. The campaign was part of an effort to promote a medical device called SimplyGo Mini.
  • Promo & Activation: REI’s #OptOutside Black Friday push from Venables Bell & Partners. REI paid its 12,000 employees to take Black Friday off, encouraging them and others to forego shopping and discover the outdoors instead.
• Noteworthy quotes:
  • “The industry — and marketers in particular — would greatly benefit from a rethink of the entire digital supply chain.” Bob Liodice, president-CEO, the ANA
  • “Agencies have shareholders, just like clients, so if the margins cannot be gained by revenue, they must be gained by cost- cutting. This leads to agencies cutting capabilities that clients desperately need in the ‘always on’ world of digital marketing.” Brian Sheehan, professor of advertising, Newhouse School at Syracuse University

AGENCY REVIEWS AND ROSTER CHANGES

Disclaimer: The reviews listed often capture larger review activity reported in the industry trade press, which we understand to be only a subset of total review activity. Specialist reviews (digital, social, PR, etc.) are rarely reported in the trade press. Also, due to the increasing number of project reviews (versus AOR/retainer reviews), many of those are not receiving media attention and therefore are not included here.

• Hewlett Packard Enterprise put its creative agency account into review, looking for the right BtoB agency partner to handle global integrated, TV, digital and social. Omnicom’s BBDO has been the incumbent lead creative agency for the past four years but the agency confirmed that it will not participate, probably due to the direct conflict with AT&T’s enterprise business handled by BBDO.
• Harley-Davidson kicked off a global creative, digital and media review. Incumbent boutique advertising shop Wolfes co- developed the creative for its newest campaign with Harley’s in- house marketing team. Starcom handles U.S. media buys. Digitas supports digital efforts.
• MDC Partners’ Vitro has been named creative agency of record for the coffee retailer Caribou Coffee following a review, replacing incumbent Colle + McVoy. The agency will handle creative, digital and strategy work for the brand.
• Media conglomerate Viacom hired independent PR firm Edelman to assist with corporate communications to change the narrative and tell a more positive story during very challenging times for the company.
• Swedish furniture retailer Ikea is reviewing its entire $444 million global media account, which is split between five different holding companies. WPP’s MEC retained media planning/buying duties in the U.S. following the last review in 2009. Dentsu Aegis Network’s Vizeum won the U.K. business from WPP’s MediaCom in the same review. Creative duties on Ikea are not under review. Agencies include Ogilvy & Mather New York, BBH Singapore, Buzzman Paris, Mother London, Forsman & Bodenfors and Akestam Holst.
• Fiat Chrysler Automobiles has selected Omnicom GSD&M as lead agency for Dodge after a review, replacing Wieden+Kennedy, which mutually parted ways with the automaker, ending a six-year relationship. FCA confirmed FCB Chicago is the official agency of record for its Fiat brand in North America, replacing The Richards Group, which remains the AOR for the Ram brand. New agencies also include Omnicom Group’s DDB Chicago and Cheil Worldwide’s Iris New York.
• Omnicom PHD becomes the global media agency of record for Volkswagen Group (Volkswagen, Audi, Porsche, Seat, Skoda and commercial vehicles) after a lengthy competitive review. WPP’s Mediacom handled most of the business, including in the U.S. PHD was an incumbent on the Porsche business. The VW Group win is considered to be the largest win in PHD’s history.
• Wendy’s has named WPP’s VML its new creative agency without a review, replacing incumbent Publicis New York, which has been handling the account since Kaplan Thaler won it in 2009. The agency will handle all creative in seamlessly integrated campaigns.
• Electrolux North America kicked off an agency review including brand advertising, digital, media, public relations, CRM and in- store marketing for both its Electrolux and Frigidaire brands to better engage consumers and to become a major innovator. DDB, Weber Shandwick and Zenith Media are the incumbent agencies.
• VML was named social media agency of record for H&R Block, charged with driving social strategy, analytics and social content creation for the brand. 360i previously handled the account.
• Heineken Singapore appointed Tribal Worldwide as its creative partner, competing with other shops, including Publicis Communications, Sapient Nitro and Possible. The agency will handle on-going through-the-line advertising and marketing strategy, and innovative experiential executions, as well as digital, social and online engagement.
• Cohn & Wolfe was named global PR agency of record for Applebee’s. Work will be led out of Cohn & Wolfe Los Angeles and Austin offices. The agency will handle consumer, corporate and franchisee communications.
• The nation’s second largest advertiser AT&T is holding a massive review for its U.S. creative, digital and media accounts for AT&T and DirecTV. The company is seeking one holding company solution for the vast majority of its advertising. Omnicom and WPP are the only holding companies invited to the review. Omnicom’s BBDO handles creative for the AT&T brand, while WPP’s MEC fields media and Grey handles creative for DirecTV. AT&T may decide to bring some ad services in-house in the future.
• SAP selected Interpublic Group’s Momentum Worldwide as its global sponsorship AOR following a review that included 20 agencies, replacing 16-year incumbent agency GMR. The agency will handle strategy, vision, measurement and evaluation, event activation and technology, and it will create video and content at sponsorship events that will live on digital, social and internal SAP channels. All other SAP agency relationships remain the same, including BBDO as lead creative agency, Fleishman for PR, Right Formula for Formula 1 sports marketing and PHD on media.
• Stanley Black & Decker consolidated its digital advertising account, spanning the corporate brand and about two dozen consumer and business-to-business brands with the MDC Partners shop KBS, following a review. Recently hired agency Acronym handles search marketing. The digital trading firm E-Trade has hired MDC’s Assembly as its new media agency to help it better understand how to best navigate today’s complex media ecosystem, engage our audiences and drive performance, and use media more creatively. In 2014, the brand brought creative and media under the same WPP roof to provide seamless integration. E-Trade’s media incumbent is a dedicated WPP unit staffed by Ogilvy One and media agency network GroupM. Creative is handled by Interpublic Group of Cos.’ R/GA and also works with SS&K for social and WPP’s Wunderman for CRM.
• The Minneapolis-based retailer Target Corp. is consolidating its $686 million media and planning business to GroupM, replacing incumbent Haworth Marketing & Media (since 1970).
• Following a review to consolidate agencies, 21st Century Fox retained Vizeum and Zenith as its media agencies in the U.S. and Canada. Assembly, an MDC company, was added to the roster. Assembly will handle all media planning, search and programmatic buying for 20th Century Fox, Fox Home Entertainment, Fox Searchlight and FX Networks.
• Chuck E. Cheese’s named Current, part of Interpublic Group of Companies, as its public relations agency of record. Current will focus on building brand awareness and launching new offerings for Chuck E. Cheese’s, as well as conducting ongoing media relations to support its promotions, fundraising and seasonal programs.
• MDC Partners agency Anomaly has been tapped by Apple’s Beats by Dre to handle creative work after an agency search. The agency will handle creative, digital and experiential elements from its newly opened office in Los Angeles. Interpublic shop R/GA continues to work with Beats in the U.S. and in other international regions.
• Just over six months after tasking 180LA with a major rebranding campaign, HP decided to move work away from the Omnicom agency. The client has worked with roster shops including 180LA and BBDO for several years. HP recently added Gyro and Paris- based independent agency Fred & Farid.
• Hyatt Hotels Corp. has selected MullenLowe as its global creative agency of record for all 12 of its brands, following a competitive review. The brand is consolidating the work previously handled by eight to 10 agencies, including Pereira & O’Dell, not just from an efficiency perspective, but to allow for a “choreographed master brand strategy.” The hotel chain is continuing to work with media buying and planning shop PHD and social media agency We Are Social.
• Financial services giant TD Bank is reviewing its media and creative business. Incumbent Interpublic Group of Cos.’s Tierney has supported TD’s creative, digital and media planning and buying in the U.S. for years.
• Publicis Mediavest/Spark and Starcom handle media planning and buying for Heineken in 30 markets around the world. However, the brand does not want to rely on just one global agency network, seeking a second global agency group. The decision will not lead to two media agencies working within the same market.
• Cruise line giant Carnival Corporation is consolidating its media agency business in North America and the U.K. with Omnicom’s PHD with the goal to seek better strategic alignment and media cost savings. PHD, which has served as the incumbent agency for two of the company’s 10 brands, will now add digital and traditional planning and buying in the U.S. and U.K.
• Newell Brands is shifting the global creative for brands such as Rubbermaid, Paper Mate and Sharpie to JWT New York from BBH New York as a result of presumed client dissatisfaction with BBH when Newell moved global PR responsibilities to WPP’s Cohn & Wolfe unit.
•  Malaysia Airlines has selected WPP’s GroupM as its media shop, with the agency beating competitors Zenith, Starcom, Havas and incumbent IPG following a review.
• Western Union has announced a global review of its $100 million media assignment. Incumbent agency Gravity Media has worked with Western Union in the U.S. over recent years.
• The Hass Avocado Board hired Hispanic shop Grupo Gallegos as its lead digital and social media agency for the U.S., following a competitive review that included 10 agencies, replacing incumbent BusinessOnline.
• Droga5, which had been working with Motorola since 2012, resigned the account. Ogilvy & Mather (which previously worked with the brand and won the global account in 2000) took over the global creative account without a pitch. Ogilvy has worked for the brand in the past and is the overseas agency for parent company Lenovo. WPP’s VML remains Motorola’s North American agency of record.
• Spirits giant Diageo (Johnnie Walker, Smirnoff, Guinness and Tanqueray) launched a review of its $2.3 billion global media account across its global media buying and planning services. The brand currently works with four global networks, including Carat in the U.S. and U.K.
• Following a review, Pittsburgh-based Smith Brothers was named creative agency for Baskin-Robbins’ international stores after a formal review. 22squared remains the U.S. creative for the ice cream brand.
• Figliulo & Partners and BBH New York are taking over Macy’s holiday creative this year, replacing incumbent agency J. Walter Thompson after a review. Macy’s reportedly ended its relationship with J. Walter Thompson following the resignation of Global CEO and Chairman Gustavo Martinez after he was accused of discrimination.
• O’Keefe Reinhard & Paul has been chosen as creative agency of record for Gildan Activewear, replacing incumbent Devito Verdi after a formal review.
• Delta Airlines tapped Omnicom’s PHD as its new media agency in the U.S. following a competitive review, replacing the incumbent Publicis Groupe’s Digitas on the U.S. media account. Digitas will continue to handle other digital marketing tasks. The media agency review follows the brand’s recent move to hire WPP’s AKQA as its global digital agency of record in an effort to consolidate its separate mobile and dot-com accounts.
• H&M has tapped Interpublic Group’s UM as its new media agency in the U.S., which adds the U.S. to the 15 other markets IPG’s media agency network already supports, replacing incumbent Publicis Groupe Zenith.
• The J.M. Smucker Co. (Smucker’s, Pillsbury, Dunkin’ Donuts and Hungry Jack) launched a review of the digital business across its 29 U.S. brands, including its creative, SEO, e-commerce and CRM.
• Pandora named Interpublic’s Deutsch (LA office) its new creative agency to handle creative as well as digital, and will work on Pandora’s brand positioning and marketing strategy as the service launches products. Incumbent Interpublic’s TwofifteenMcCann previously handled Pandora’s work.
• Campbell Soup Co. consolidated its business from multiple shops to one with Anomaly. The agency will handle creative and cross- channel engagement for its simple meals division (Prego, Pace, SpaghettiOs and Ready Meals). The company will also continue working with shopper-marketing agency Mars Advertising and media firm MEC.
• Droga5 is Pizza Hut’s new lead agency, replacing incumbent agency Deutsch, which won the business in 2014, taking the account away from McGarryBowen. Deutsch remains the lead agency for Yum Brands sibling Taco Bell.

 
Disclaimer: The AMS Monthly Industry Update is a summary and analysis of newsworthy agency/client developments picked up in recent trade related publications and news media.