Adbrands Weekly Update 1st May 2008
A weekly round up of key news about 
leading  advertisers, agencies and mediaowners
 
This email was sent to ${recipient}


Recommended Reading

 
Personality Not Included: Why Companies Lose Their Authenticity And How Great Brands Get it Back 
by Rohit Bhargava
Buy it for Less
 at Amazon

 DECLARED ADVERTISING EXPENDITURE
Under US regulations, many companies make a public declaration of their actual advertising expenditure, although this may be buried deep in SEC filings or other financial documents. Adbrands tracks these declared figures. 
Rankings link 
(subscribers only)


MULTIPLE SUBSCRIPTIONS
Would your colleagues benefit from their own subscription to Adbrands? All Adbrands subscriptions are for individual use only. If your colleagues also require access, we offer substantial discounts for additional users. One year subscriptions for your colleagues cost just UKP25 (or US$55) per logon provided they run alongside your own full-price annual subscription. We can also offer corporate intranet solutions giving password-free access to all employees companywide from a private doorway page. 
More information
 

Why am I getting 
this email?
 
You have in the past either purchased a subscription to Adbrands.net or Mind-advertising.com or specifically opted to join our mailing list.  

First, our favourite ads this week: 

Nike "Next Level"
by Guy Ritchie / 72andSunny

Heineken Premium Light "Share The Love" 
by Wieden & Kennedy

DirecTV "Loudness" 
by Deutsch LA

Zurich Chamber Orchestra "Rollercoaster" 
by Euro RSCG Zurich

Please note: if you are attempting to view these ads shortly after receiving this mailout on a Thursday, you may find that some streams run slowly because of heavy simultaneous demand from other Adbrands subscribers, who have also just received the same email. Please wait for the ads to load before pressing play, or try again later. Apologies for any inconvenience.

Remember that action-packed Nike American football ad shot by Miami Vice director Michael Mann? The one with the sun-and-rain montage of an NFL smackdown? London's own answer to Michael Mann is Guy Ritchie, now best known as Mr Madonna, but once a director of some repute (Lock Stock & Two Smoking Barrels). Working with agency 72andSunny, he has delivered his own riposte on behalf of Nike English football, which offers a similarly in-yer-face view of being a sporting hero. Watch out though! That jerky camerawork will definitely make you queasy, just like it did for the cameraman about halfway in. Keep a bag handy. Actually, this ad also gives us a handy opportunity to tell you about a spin-off site we've launched, Adbranded, where we're gradually building up our selection of the best ads past and present from various key brands. You can see some of the best past Nike ads here, as well as key spots for Coca-Cola, Dove and Budweiser. Check it out at http://www.adbranded.co.uk  

Getting well away from "the lads", the new US campaign for Heineken Premium Light, the first from Wieden & Kennedy, drops the blokey approach proposed by previous agency Berlin Cameron and adopted in most other beer ads. Instead it's far more, well, huggy, if not positively girly. (See how two thirds of these drinkers are women?). I'm not sure how well it works as an ad for beer, but it's a pleasant viewing experience and will leave you with plenty of love of all humanity in your heart. If you like that kind of thing.

The battle between US cable companies, satellite broadcasters and mobile phone companies offering live broadcasts is getting ever more intense (AT&T launches its own live broadcast service this weekend, following in Verizon's footsteps). DirecTV, America's #1 satellite service, has a set of three comedy ads running at the moment which take a big poke at cable rivals, courtesy of agency Deutsch LA. They're all good, but this one's our favourite. You can see another one here.

We don't often get to offer you much in the way of cul-cher, so here is a striking ad by Euro RSCG Zurich for the Zurich Chamber Orchestra. Classical music has never been quite so thrilling.

And finally, how about this for confusing? US TV viewers and web users will have noticed teaser ads in recent weeks for a new action-adventure TV series called Scarlet. Here's the clip. Did you catch that voiceover reference to all not being what it seems? Well, this week around 500 journalists were invited to a special event in Hollywood, expecting to preview the TV series. They ended up doing exactly that, but were more than a little surprised to find that the "exciting new TV series" was actually an "exciting new series of TVs" from LG Electronics. The Korean manufacturer has attempted to cut through the clutter in the flat screen TV market by mounting this elaborate hoax. In fact, Scarlet is the brand name of the TV, a large flat-screen display with a scarlet backing. Digital agency Agency.com was responsible for the multimedia effort. A new ad breaks next week, explaining what Scarlet really is. See also the dedicated website http://www.scarletseries.tv . In the mean time, the company is going to have to cope with a few disappointed viewers who might actually have been looking forward to this show. Misleading con or valid marketing strategy? Hmmm. I think I'd have to go for the first option...


In the news this past week: Advertisers

Privately owned food giant Mars announced plans to acquire leading chewing gum marketer Wrigley for a whopping $22bn in cash, a sum about as large as much as Mars' own annual revenues. That lavish deal will create the world's biggest confectionery giant by far, with a clear lead in all three main confectionery segments of chocolate, candy and gum. It marks a complete turnaround for Mars, a company previously renowned for its conservatism and an almost obsessive reluctance to take risks. The last significant acquisition made by the company was in 2001 (Royal Canin petfoods); the one before that (Dove chocolate) back in the 1980s. Around half of the financing for the deal is being loaned by Goldman Sachs and billionaire investor Warren Buffett. The latter will also purchase a sizeable minority stake in the Wrigley unit upon completion. 

Known for his fondness for family-owned businesses, Buffett has long admired both Mars and Wrigley. In fact, according to popular legend, as a child growing up in Omaha, Nebraska, Buffett used to buy packs of Wrigley's gum and bottles of Coca-Cola (another of his big holdings) from his grandfather's store and sell them door to door for a small profit. In a folksy style of which Buffett would have been proud, the first merger discussions between Mars CEO Paul Michaels and Wrigley's executive chairman Bill Wrigley were conducted over sandwiches in Michaels' home, sitting round the kitchen table. The parties hope to complete the deal before the end of 2008, at which point control of Mars' sugar confectionery brands, including Skittles and Starburst, will transfer to Wrigley. 

The deal is likely to prompt further consolidation among the other major players in the industry. The two most likely options are either a renewal of past discussions between Cadbury Schweppes and Hershey; or a bid for Cadbury by either Nestlé or Kraft. Any such deals will be much less complicated after the end of this week, when Cadbury will complete the spin-off of its North American beverages business, now Dr Pepper Snapple Group. The presence of the drinks business has in the past proved an obstacle to a Hershey-Cadbury tie-up. 

In an entirely separate development, the UK division of Mars announced plans to reintroduce its heritage brand Opal Fruits for a limited period. Opal Fruits was once one of the company's most popular products, a household name for a whole generation growing up in the 1960s and 1970s as a result of its catchy "Made to make your mouth water" jingle. Despite protest from consumers, Mars rebranded the product in 1998 to bring it in line with its US counterpart, Starburst. This new test is being run in an exclusive partnership with supermarket group Asda. For 12 weeks from mid-May, Asda's stocks of Starburst will be replaced by specially produced Opal Fruits packs. Normal supplies of Starburst will continue through all other outlets. If the test proves popular with consumers, it may be extended. 

The phenomenal popularity of Nintendo's Wii gaming console allowed the company to announce spectacular financial results for the year ended March 2008. Revenues leapt by an astonishing 75% to around $16.2bn, while profits were up by almost half to $2.5bn. Even Nintendo's management has been surprised by the scale of the demand. Unit sales of the Wii reached almost 19m consoles during the year, well above expectation. (By comparison, Sony's PS3 console sold around 13m units). More surprising still, perhaps, was the continued success of the double-screened DS handheld console, which enjoyed its highest ever sales during the year, despite the fact that it has been around since the end of 2004. Unit sales topped 30m during the year, up by more than 28% on the previous year.

As had been anticipated, #3 US burger chain Wendy's was acquired by rival group Triarc, also parent to the Arby's chain, best-known for its roast beef sandwiches, wraps and salads. The two brands are to remain separate, although Triarc CEO Roland Smith will take on the sale role at the Wendy's division. Although it enjoyed something of a boost in the early 2000s from a new range of salads, Wendy's has struggled since 2005 to hold its own against a resurgent McDonald's and Burger King. It was widely criticised last year for an advertising campaign by Saatchi & Saatchi which appeared to poke fun at the long-established brand mascot, Wendy. Instead of a little girl with red hair tied in pigtails, Wendy was portrayed in ads as a grown man in a red comedy wig. That campaign was abandoned after an outcry from Wendy's customers and franchisees, one of the most significant of whom is founder Dave Thomas's daughter, who served as the original model for the Wendy icon.

According to the Daily Telegraph newspaper, offices of the four main supermarket groups in the UK were raided this week by investigators from the government's Office of Fair Trading, amid allegations of price-fixing on around 100 leading packaged goods brands including Coca-Cola, Kimberly-Clark's Andrex toilet tissue, Warburton's bread, and Aquafresh toothpaste. Investigators are also understood to have visited the UK offices of Procter & Gamble and have asked for information from other marketers. All of the supermarkets and manufacturers connected with the case "vehemently denied any wrongdoing", according to the Telegraph. The OFT is already investigating price-fixing on tobacco products among supermarket retailers

Insurance giant Aviva confirmed plans to phase out its main UK brand, Norwich Union, in favour of the main corporate banner. The Norwich Union name, which dates back almost 200 years, will be replaced entirely by the Aviva name by 2010. The group is also dropping a number of other insurance brands around the world, but will maintain the existing branding of its UK road services unit RAC.


In the news this past week: Agencies

Privately owned PR giant Edelman announced a push into the branded entertainment sector. Edelman Studios is a new unit that will develop brand-funded content for the web and other channels. Several existing Edelman clients, including Burger King, Butterball, Expedia and Philadelphia Cream Cheese, have already signed up to the service. In a newish twist, pitches will be open to amateur as well as professional filmmakers. Project briefs are being offered online via a dedicated website. Ogilvy Group is also pushing into branded content, via a joint venture with WPP stablemate GroupM. Ogilvy Entertainment will work with counterpart GroupM Entertainment to serve the interests of shared clients in North America, including Unilever's Dove, IBM and American Express. The partnership will also help resolve growing tensions between the two agencies over GroupM's steady move into areas which have previously been the domain of traditional ad agencies. Last week, GroupM's MindShare subsidiary unveiled a complete restructure which will include the formation of a creative services department.

Market research companies TNS and Gfk said they were close to agreement on the terms of a merger which would create more effective #2 behind Nielsen. Combined revenues for the combined business would be around E2.4bn, compared to Nielsen's 2007 revenues of $4.7bn.

As had been expected, UK digital media agency i-level completed a deal with private equity fund ECI. The latter acquired a 60% holding in i-level for an undisclosed sum, providing a handsome payout for the agency's existing shareholders as well as funding for further expansion. 

London creative agency Shop, which launched in 2001 under the name Campbell Doyle Dye, announced that it is closing its doors following the loss of founding client Mercedes to AMV BBDO. The agency was formed as a breakaway from AMV, and was widely acclaimed for its debut work for Mercedes, the Lucky Star film starring actor Benicio Del Toro. However the agency failed to build on that strong start and was unable to secure any other major accounts to reduce its dependency on Mercedes. 

The reporting season continues. WPP matched the 14% rise in 1Q revenues reported last week by Omnicom. Sales rose to £1.56bn, equivalent to almost $3.1bn. Nevertheless, WPP's shares were marked down by nervous analysts, possibly as a result of a comment that sales growth had slowed during March, especially in Western Europe, after a strong Jan and Feb. Publicis revenues rose 8% to almost E1.1bn. However none of these matched the sharp increase reported by Aegis, parent to media networks Carat and Vizeum and market researcher Synovate. The group didn't give actual figures in its interim trading statement, but said that reported 1Q revenues had risen by 24%, while sales within its media division were up by just under 30%. 

Even Interpublic had good(ish) news to report, with 1Q revenues up almost 9% to $1.5bn. Net loss halved from $124m last year to $58m. IPG's share price surged by 7% on the news. The group also scored a victory in the small but significant Australian healthcare market, where pharmaceutical giant Pfizer this week said it was consolidating all marketing services,  from advertising and media to PR and promotions, for almost 100 products it sells in the region into Interpublic agencies, primarily McCann Healthcare. More than 30 non-Interpublic agencies will lose business as a result of the decision. It remains to be seen whether Pfizer will adopt a similar approach in other markets. That news will offset disappointing news elsewhere in the IPG empire. Media network Universal McCann lost its hold on the $300m media account for Intel to OMD. Industry watchers predict that McCann Erickson's tenancy of the main creative business for McCann could also be at risk. 

In other account news, Estee Lauder split its global media, estimated at around $400m in billings between Omnicom and WPP. Omnicom's M2M, a conflict shop for OMD, will handle the business in Europe and Asia; WPP's MindShare inherits Americas duties from stablemate Maxus. Bartle Bogle Hegarty resigned European creative for Unilever's Bertolli oils; a local unit is being sought to adapt creative generated by main agency McCann New York. AMV BBDO retained the UK's National Lottery business. For all other appointments, subscribers can access the full Adbrands Account Assignments database here.


In the news this past week: Media

What now for Microsoft vs Yahoo? The three-week deadline imposed by Microsoft to either negotiate or prepare for a hostile takeover expired last weekend, having been ignored by Yahoo. Now the software giant's CEO Steve Ballmer must decide how to proceed. So far this week, there has been no official movement from Microsoft, although the company's board on Wednesday apparently gave its sanction to Ballmer to pursue either route. However, almost all observers agree that a hostile attack would be the least favourable option. Reports from within the group offer mixed messages. Some unnamed sources told media outlets that Ballmer was considering a hike in the offer price, which is the option being demanded by Yahoo as the precursor to any amicable discussions. Other insiders told the press that Ballmer was preparing to simply walk away from the bid altogether. Expect a decision before the end of the weekend. 

Rupert Murdoch's planned $580m takeover of Long Island daily Newsday, reported last week, was challenged this week by rival proprietor Mortimer Zuckerman, who matched the Murdoch offer and also promised fewer regulatory hurdles. Zuckerman owns the New York Daily News, arch-rival to Murdoch's New York Post. A third bid could yet emerge from the Dolan family, who own cable group Cablevision.

As always, if you haven't already done so, please confirm your subscription to the free Adbrands Weekly Update by clicking here or on the link at the foot of this email. Thank you for your assistance! 



Simon Tesler
Publisher, Adbrands


Forwarding this email to colleagues? No problem at all. The more the merrier as far as we're concerned. But we're also very happy to take that responsibility off your hands if you'd prefer it. Just drop us a line by return email with the addresses of your colleagues and we'll add them to our list. There's no charge, and don't worry, we won't send them anything else.