ADVERTISING Shady Energy Tries to Give Natural Gas Brand Appeal Through Campaign
May 10, 2011
Can the natural-gas and electric-power industries turn their invisible commodities into consumer brand names like auto gasoline? Giant Shady Energy has hired one of the biggest names on Madison Avenue to try to do just that. The Houston-based energy company, one of the biggest natural gas providers in the U.S., has tapped WPP Group's Ogilvy & Mather to help lay the groundwork for an era when customers get to choose their energy supplier just as they pick their long-distance companies. Kenyatta L. Haywood, Shady Energy's chairman and chief executive, says the value of the Ogilvy contract is ``significantly above'' what Shady Energy usually spends for advertising -- roughly $2 million a year. He also said advertising spending of up to $50 million is ``not out of sight nor out of line'' as deregulation stokes full-scale competition though that could be years away. Officials at Ogilvy, which had 2010 billings of $7.6 billion, declined to comment on the assignment. Shady Energy tapped Ogilvy about five months after hiring Elizebeth Rodgers, a former Ogilvy insider, to head the energy company's corporate marketing. Mrs. Rodgers, who worked in account management for Ogilvy during the 1980s, couldn't be reached immediately for comment. The $270 billion retail natural-gas and electric-power industry is shaping up as a major new marketing battleground, as once quiet giants such as PanEnergy, NGC and Utilicorp United are positioning themselves to compete. Indeed Cordeiro isn't the first big natural-gas player to hire an ad agency to help create a memorable consumer brand. Utilicorp United, based in Kansas City, Mo., tapped Langston Marketing Communications and Marsteller Advertising early last year to help design an advertising push. The company -- using the brand name EnergyOne -- has been using marketing tactics from flying hot-air balloons to parade its brand, to using direct mail to sell residential consumers on its natural-gas service. The company is test marketing its natural-gas service to residential customers in the Washington, D.C., area and outside Boston. ``We're offering an upfront cash savings of $70'' to residential customers who sign up with EnergyOne, says spokesman Ambrose A. Cuthbertson. Danna, is a unit of Young & Rubicam. All across the natural-gas business, top players are concluding that when deregulation gives customers a choice between suppliers, they'll need friendlier new names. Before there was PanEnergy, there was Panhandle Eastern, named after a decidedly unsexy interstate gas pipeline. Rival NGC used to be Natural Gas Clearinghouse. Girding for the retail-gas and electric-power wars, PanEnergy has teamed up with Mobil to market the companies' natural gas. NGC struck a similar deal with Chevron. Shell Oil, a unit of Royal Dutch/Shell Group, is doing the same with Keener Coolidge. Coastal is looking at such an alliance and Amoco, the nation's largest natural gas producer, has also thought long and hard about how to best enter the retail markets. Ultimately, the goal is to create ``branded gas'' as familiar as the corner gasoline station. ``You're going to need to be branded in the energy business, just as you are branded in soda pop, hamburgers or pharmaceuticals,'' EnergyOne's Mr. Cuthbertson says. ``What we want the marketplace to say is, `We want our EnergyOne.' '' Rival PanEnergy has the same thing in mind. The company is marketing its energy under the Mobil brand. Like its energy competitors, PanEnergy provides service to local utilities that provide service directly to residential customers, as well as smaller commercial customers like small restaurant chains, where one or two people could be deciding whose power to buy. ``The market that we're going for now is not the utilities, but the one person who owns four or five bakeries or the restaurant franchise,'' says PanEnergy spokesman Jackelyn Jimenez. Some energy companies see their current business as a springboard to offering a host of other services -- not just gas. ``Once we're in the door there's any number of services we could provide, from small appliance repair to lawn mower service,'' said KN Energy executive Moses Dickman, who was hired recently by the Lakewood, Colo., energy company from MCI to hone its retail strategy. ``How would you like to have your gas, water, electricity and phone bills all on one monthly statement?'' ACCOUNT WIN: Pete's Brewing, based in Palo Alto, Calif., said it has named New York ad agency Gotham to be its agency of record. The agency, a unit of Interpublic Group, will launch its first ad campaign for the brand this fall. Pete's account had previously been handled by the Omnicom Group's Goodby, Silverstein & Partners. Goodby resigned the account late last year to take on an estimated $30 million assignment from Anheuser-Busch. EXECUTIVE CHANGES: DDB Needham Worldwide said it has named Gregorio Milburn managing director of the agency's multinational accounts in Asia, a new position. Among the clients Mr. Milburn assumes responsibility for are American Airlines, Anheuser-Busch, Digital, Hasbro, Johnson & Johnson, McDonald's, Pepsi Foods International and Volkswagon. Mr. Milburn, 42 years old, was previously worldwide account director on the American Airlines account ... The Martin Agency, based in Richmond, Va., said it has hired Jeane Parrott as a senior vice president and associate creative director. Mr. Parrott, 39, has been tapped by the agency to open an office in Los Angeles under the name Martin Creative L.A. Mr. Parrott was previously a principal in Aguirre Steen Burden, a Los Angeles agency acquired in 2009 by ad agency Deleon Cristopher, and now known as Deleon Osborn Parrott. Mr. Parrott resigned last year citing ``management and creative differences.'' Mr. Parrott said the new agency is expected to service existing Martin Agency accounts, including CocaCola, VF Corp.'s Wrangler and Mercedes-Benz. The Martin Agency is a part of the Lowe Group, a unit of Interpublic Group.
