Inside the breakup of Adam&Eve and John Lewis

The ads, according to Adam&Eve/DDB’s head of effectiveness Les Binet, “delivered over £1bn in extra sales revenue,” with an ROI ratio somewhere between 8:1 to 10:1. If so, why would John Lewis put its account up for review?

Well, multiple sources have told The Drum that, behind the scenes, all was not as it seemed. The agency was tasked with creating bigger and bolder campaigns on a stricter budget and for an ’underbaked’ fee, several well-placed sources have told us, though another source familiar with negotiations disputes these accounts. This was compounded in recent years by a revolving door of senior leaders at the brand, as well as a breakaway of top personnel at Adam&Eve, which slowly eroded a once unshakeable client-agency relationship.

A decade out of date

Adam&Eve secured the John Lewis account in 2009, a mere 13 months after its launch. It was a significant coup for the fledgling agency and one that made it synonymous with Christmas advertising in Britain. As the partnership between the two companies matured, it came to be seen as a model for successful advertisers – in 2019, the pair even won a D&AD pencil for ‘collaboration’.

According to staffers who worked across the brand and the agency over the last 14 years, however, its once-handsome retainer failed to match the reputation forged by the pair. Though Adam&Eve’s fee was subject to annual review – and brand-side staffers say it rose as the brief expanded – as the agency itself grew, its work for John Lewis became more valuable for the prestige it generated than for its financial benefit.

“The fee arrangement was, ‘we’ll pay you one number and you’ll do all of our briefs’ – that was the agreement,” explained one former John Lewis employee. The Drum understands, however, that Adam&Eve's billable hours did increase significantly over the course of their relationship.

Asked to comment on this story, a John Lewis spokesperson said: ”We don’t discuss our commercial relationships with suppliers.”

• End of an era: creatives reflect on Adam&EveDDB’s best John Lewis ads

Despite it being the agency’s flagship client, the commercial relationship was “significantly underbaked,” said one ex-agency employee, because the Adam&Eve/DDB leadership saw the business as an investment in its own brand and reputation. As such, the agency threw resources at its calling card account.

“I never thought it reflected the amount of work – it was all about the opportunity,” explained one former account manager.

“It was very generous” to John Lewis, said another former agency staffer. “The creative opportunity there was [worth] more than the financial opportunity, versus other accounts.”

That strategy worked: internal competition just to work on John Lewis was high, while a berth at the agency became a sought-after prize for ambitious creatives. Omnicom network DDB bought the agency just three years after it won the account, for around £60m, and developed it into its flagship agency in the UK, later opening offices in New York and Berlin.

As the agency grew, so did John Lewis’s brief. In 2015, Adam&Eve took on the account for John Lewis sister brand Waitrose. That led to a significant increase in its fee, brand sources tell The Drum, but also in the amount of work taken on. “The number of projects we’d have would grow year-on-year – the scope of the work was huge,” said one former staffer.

And while staff queued up to work on the Christmas campaign, away from the big festival blockbuster life on the account was typically more mundane. One former staffer described it as a “two-speed” account, split between the excitement of a seasonal blitz and a more onerous brief of pushing a legacy British retailer “with all the pressures that brings.”

The scale of the challenge facing the agency also grew – from rival retailers competing for attention at Christmas to the pressure to beat its own past efforts and mounting public indifference (The Guardian’s TV critic, for example, dismissed its 2021 sci-fi effort as “such a straight-down-the-line John Lewis Christmas advert that you can only imagine it was assembled by tombola”).

By this point, former staffers say, the financial compensation offered by the brand covered less and less of the work the agency provided. “No one ever talked about it,” said a former marketer at the brand. “It got to a place where [the fee agreement] was a decade out of date.”

By 2020, John Lewis’s chief marketer Craig Inglis and managing director Paula Nickolds, as well as Adam&Eve founders James Murphy, Jon Forsyth, Ben Priest and David Golding, had all moved on. The team that had shepherded the brand/agency partnership from the beginning left behind a celebrated creative legacy, but as a former staffer at the agency told The Drum: “They didn’t leave behind a functioning commercial relationship.”

Supplier relationship

Despite its stockpile of brand equity, John Lewis Partnership has struggled to grow commercially in recent years. Waitrose’s sales were 5% down like-for-like in 2021, while John Lewis’s sales were marginally up 3% like-for-like that year.

In the first half of 2022, the group posted almost £100m in losses, compared with a £52m loss in the same period the year before – a financial hole too big for any single Christmas campaign to fix.

• John Lewis never knowingly under-advertised, but it’ll take more than ads to save it

Former employees say that, as a new set of marketers arrived at the brand, production budgets came under heightened scrutiny. Inglis was succeeded first by Claire Pointon, who left after three years, and recently by pan-partnership customer director Charlotte Lock.

Nonetheless, for years the agency agitated to renegotiate better terms to account for its flagship account’s growing weight. One source points to the brand’s sweeping 2018 rebrand, which required a second campaign film in addition to that year’s Christmas spot. The staffer claims that the heavier load meant that the annual budget had totally dried up by August.

A harder perspective on production spending was adopted, said a marketer who worked at the brand. “It was a very dramatic change of guard,” they said.

“When we did Tiny Dancer, if Adam&Eve wanted an extra £50,000, £80,000, £100,000 for a scene of a shoot, Craig would just say yes,” they continued. “There’s absolutely no way in flaming hell [Charlotte] would be saying yes to that kind of thing.”

A former agency staffer, who worked alongside Lock when she was director of data, loyalty and digital products at Co-op, said: “She is very clear on what she does and doesn’t want.”

Lock and fellow customer director Nathan Ansell now have a chance to give another agency a run at one of the highest-profile brands in Britain.

Tammy Einav, who had worked on the John Lewis brief since it was won and who rose to become chief executive of Adam&Eve/DDB, was effusive in her sign-off. “To say we are immensely proud doesn’t begin to capture the feelings we have towards what we have achieved together over the years,” she said in a statement.

“We are therefore saddened that the team at John Lewis Partnership have decided to call a pitch. While we appreciate being invited, we have made the extremely difficult decision not to re-pitch. We shall always be grateful for the opportunity to create work that has been so loved.”

In her own statement, however, Lock characterized the 14 years as a mere “supplier relationship.” Ansell echoed the statement, commenting: “[Adam&Eve/DDB] has been an influential creative and strategic partner for the Partnership. However, after many years without reviewing our agency support, we believe it is the right time to assess.”

Adam&Eve/DDB declined to comment on this story.