Dear ${token1} ${token2}

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! 

Our favourite ad this week: 

The spectacular new ad for Unilever's Axe / Lynx deodorant maintains the campaign's excellent creative streak. Thousands of bikini-clad girls emerge from forests and oceans and all race to get to a single happy guy spraying himself all over with two cans of Lynx. Spray More, Get More indeed! The ad received just one airing on UK TV, just before the England v Sweden match. Another big plaudit for Bartle Bogle Hegarty.

New Snapshots

Recently Revised Profiles and Snapshots

In the news this week: Advertisers

Johnson & Johnson will become the clear global leader in the OTC healthcare sector as a result of the deal it agreed this week to buy the non-prescription healthcare division of Pfizer for a massive $16.6bn. Brands include Listerine, Sudafed and Bendryl, among others. Competition for the prize was intense - J&J outbid several other companies including GlaxoSmithKline and Reckitt Benckiser - and the deal price climbed well beyond the $14bn Pfizer had originally hoped to achieve. Assuming the purchase gains full approval from regulators and shareholders, combined annual sales from J&J's already huge consumer health portfolio will be boosted by another 40% to around $13bn.

The sale of its OTC unit couldn't come at a better time for Pfizer, which is anticipating the first ever fall in sales for its flagship product, the cholesterol-lowering pharmaceutical Lipitor, currently the world's best-selling prescription drug with sales of more than $12bn last year. The problem is not any inherent flaw in Lipitor. However, its main rival Zocor, marketed by Merck & Co, this week lost its US patent, opening the field to intense competition from generic copies. Although Lipitor's patent doesn't expire for another five years, the expected flood of low-priced competitors is almost certain to dent its sales. Like Zocor, Lipitor is priced at around $3 a daily pill, and US health insurers will be less eager to recommend the higher-priced products when generics are likely to cost $2 a pill or less. 

There seems little doubt that some form of merger between music groups EMI and Warner Music will take place. Having rejected EMI's initial offer of $4.2bn a few weeks ago as being too low, Warner responded with its own deal, proposing to buy EMI instead for around $4.5bn. EMI rejected that and increased its own bid to $4.6bn. Warner made another counter-offer to buy EMI for the same amount. The dance continues... The main question is not whether the two companies want to merge - because both clearly see the sense in such a move - but who will buy whom. The danger is that bad feeling may arise during this squabble that will interfere in the eventual integration of the businesses, or even derail negotiations altogether.

Kraft Foods, struggling to regain growth after years of stagnation, ousted Roger Deromedi as CEO, replacing him with Irene Rosenfeld, previously chairman & CEO of rival Frito-Lay, the snacks unit of PepsiCo. Meanwhile, Kraft is said to be preparing a formal bid for the Southern European operations of United Biscuits. One of the jewels in the struggling British cookie company's crown is its subsidiary in the Iberian peninsula. Currently UB controls seven of the ten best-selling biscuit brands in Spain, including Fontaneda, Artiach and Royal, as well as Fruco juices and Apis pate. It also has a 39% share of the Portuguese biscuit market with Triunfo. At the same time, Kraft's parent Altria confirmed that it would move forward with plans to spin the entire food company off as an independent entity. A minority stake in Kraft was floated a few years ago, but a full demerger has been delayed by Kraft's weak performance and the threat of litigation related to Altria's other business, tobacco. However, with new tobacco lawsuits steadily decreasing year-by-year, this is now seen as less of a threat than previously. No date has been set for an offering of Altria's remaining 87% holding, but it could come before year-end.

Two British companies struggled with image problems this week. Cadbury Schweppes was forced to order a recall of around 1m of its market-leading Dairy Milk chocolate bars in the UK after a leaking pipe at a production facility gave rise to concerns of salmonella contamination. Meanwhile British Airways came under investigation by competition regulators in the US and UK for colluding with rivals, including Virgin, to fix an agreed rate for fuel price surcharges on transatlantic flights. Virgin Atlantic is not under investigation, and was reported to have assisted regulators by supplying information about BA, thereby triggering the full investigation.

After months (if not years) of delays, DaimlerChrysler has finally confirmed that it will roll out its sub-compact Smart brand in the US. The marque will arrive in 2008, with exclusive distribution through independent retail group United Auto.

Intel, struggling to bolster its share price and beat growing competition from rival AMD, called it quits in the mobile handset sector, selling off the division which makes components for phones and handheld devices to Marvell Technology for around $600m. Intel continues to dominate the computer market, but has long struggled to weaken the stranglehold of US rivals Texas Instruments and Freescale on the handset sector.  

In other deals, the BBC sold a majority stake in BBC Books, the unit responsible for spin-off titles from its broadcast division, to Bertelsmann's Random House. Indian tea and coffee producer Tata took its first steps into the US market, acquiring well-known coffee brand Eight O Clock. 

In the news this week: Agencies

The Cannes Lions festival came to an exuberant end last weekend. Many delegates declared this year's event, the first fully under the management of publishing group EMAP, to have been the best ever. A full list of all the winners is available on the official website. We'll just mention the recipients of the special awards. TBWA\Paris was named Agency of the Year for the 4th consecutive year, Crispin Porter & Bogusky took Interactive Agency of the Year, Scholz & Friends Berlin was best Direct Agency, and Universal McCann Sydney won best Media Agency. Production house MJZ USA was winner of the Palme d'Or.

Accounts Changing Hands: The motor industry was responsible for two shock account moves this week. First came the appointment of Germany's Jung von Matt as the new lead agency on the Mercedes account, replacing long-time incumbent Springer & Jacoby. The latter had been on notice over the account for several months. Then, General Motors announced that itr would move its $225m Cadillac creative account out of Leo Burnett and into independent Modernista! The car company recently appointed a new marketing chief, and faced widespread apathy over its fashion parade ad for this year's Superbowl. Modernista already handled creative projects for the brand, in second palce to Burnett. 

In other news, Heineken called a review of its global creative account. Incumbent StrawberryFrog is pitching against Frank Lowe's Red Brick Road  Telstra awarded its A$80m media account to OMD. The Australian office of Naked won strategy and planning for the telecoms group's Big Pond online division. French skincare group Yves Rocher appointed M&C Saatchi GAD. Dell shifted another chunk of its European creative account out of DDB London and into Adpeople of Denmark. (DDB retains broadcast creative). 

Regards


Simon Tesler
Publisher, Adbrands

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. 

Recommended Reading

 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