Marketing journalist and former editor of The Drum, Mairi Clark discusses the implications for Aegis owned media group Carat following its appointment for the global General Motors media account.
Fifty agencies and $3 billion worth of work. It was inevitable that when the decision was made on the General Motors pitch it would make headline news.
Starcom MediaVest Group, which had proudly worked on the North America region’s account since 2005, lost out to the British-owned Aegis group-owned Carat. Some may say sour grapes were at play when Publicis – the French owned parent company of SMG – issued a statement saying that the loss was a mere ‘0.5%’ of their annual turnover, but with accounts such as Blackberry, Honda and, albeit the now under review, Heineken, that’s reasonable to believe. But judging by some comments from insiders across the pond, the snub to Publicis is not as bad as the appointment of Carat.
Several people have commented privately that for a US-owned car manufacturer to appoint a British media agency, especially when it is in the process of appealing for US governmental help, is distasteful. Others have commented that the consolidation of the one of the biggest advertising accounts in the world was down to agencies being unable to co-ordinate their work. Joel Ewanick, the marketing head at GM, even told a local newspaper in Detroit this month, that it frustrated him. “I don’t understand why agencies just don’t want to work together,” he said.
But is the move something more poignant? Aegis has become well-known for its cross-media planning and buying, and its approach to social and mobile media – which comes as part of its responsibility for GM. The account shift signifies a game-changer for the group. Up until the last six years, before the leadership of advertising veteran Nigel Morris – a formerly London-based adman now in charge in the group’s North American group – its credentials remained fairly based in traditional media planning and buying. Following Morris’s relocation to NY, the agency has claimed a space in the more forward thinking agency culture. Its social media and mobile skills are second to none, and with the move towards connected TV, its teams across the globe are well-versed to advise GM.
However, SMG is in a similarly robust state. Although it’s had to weather a tough year of restructuring in 2011, it’s proved its credentials with the first 3D iPad ad, the only Angry Birds sponsored level and its outstanding win of the Novartis account in the last month of 2011. The only looming cloud for SMG is the Heineken review.
For Aegis, the win means a complete rethinking of their business structure. Having gone from servicing the account in Europe, to handling it globally – apart from India, China and Brazil – it pushes the group into being a major player in the US. An influx of over $2 billion income will make the group a definite competitor for the two titans – Publicis and Interpublic – that were the incumbents on the business.
Aegis’s Morris will be relishing the task ahead.