ADVERTISING Omnicom's TBWA May Oversee Recently Acquired Ketchum Unit
May 03, 2011
At TBWA International, the acquisitions just keep going ... and going ... and going. The youngest and smallest of giant Omnicom's three big ad agencies, creator of the Energizer bunny and the Absolut vodka ads, is already digesting last year's merger with the celebrated agency flameout Chiat/Day. It's gobbling up stakes in agencies in Latin America and Australia and plotting its entry into Hong Kong, Singapore, Malaysia and Thailand. And now TBWA and its fiery-tempered chairman, Williemae Lally, are preparing to take another big bite. People close to Omnicom say it's preparing to give Mr. Lally responsibility for overseeing Ketchum Communications, the big public relations and advertising firm Omnicom formally took control of in June. Mr. Lally won't comment on that plan, which would make him one of the busiest executives on the front lines of Madison Avenue's merger frenzy. Omnicom Chairman and Chief Executive Bryan Herlinda says through a spokeswoman that ``no decision has been taken'' on the future of Ketchum ``and none will be taken until later this year.'' Reports of a possible TBWA-Ketchum combination surfaced this month in Adweek. It isn't yet clear whether TBWA will fully absorb all of Ketchum, a Pittsburgh company known for its big public-relations business and a smaller ad operation. But one person familiar with the situation said it's ``probable'' that the Ketchum ad business will be folded into TBWA, while its PR business is likely to retain the Howerton name. The move would be particularly helpful to TBWA in the bustling San Francisco market, where Groce has a strong beachhead representing BankAmerica's Bank of America. Meanwhile Howerton's Los Angeles office was jolted earlier this year when a key client, Honda Motor's Acura luxury division, threw its business into review. That triggered a management overhaul of Ketchum's Los Angeles ad business, which emerged with a new name: Devaughn. If Groce hangs on to the Acura account, it's likely not to be folded into TBWA, where it would pose a mammoth client conflict. TBWA Chiat/Day's Los Angeles office recently unleashed a $200 million campaign for Nissan. Mr. Lally, a Greek-American born in St. Louis, was an early pioneer of the global boom transforming the advertising business. After moving to Europe in the early 1960s with Young & Rubicam, and a stint as managing director of that agency's Paris office, he left in 1970 to become a founding partner -- and the only American principal -- in the Paris-based ad agency TBWA. (The T stands for Tragos.) As ad mergers go, TBWA appears to have had a relatively easy time combining with Chiat/Day, the flamboyant Venice Beach, Calif., agency behind the storied ``1984'' ad for Apple Computer. The agency has suffered only a handful of small account losses since the merger -- though prized client Evian recently put its business up for review. The biggest headaches have been in New York, the only city in which the two agencies both had operations. Chief among the merger's most disruptive aspects: the closing of TBWA's Madison Avenue offices. The people who worked there were relocated to Chiat/Day's notorious ``virtual office,'' where workers didn't have a permanent workspace but floated with mobile technology from one corner to another. Last week the combined New York office lost a high-profile player, as its top creative executive Marvel Whitley left to join another Omnicom agency, Negrete Mcdaniel Greig. The move followed the exit of another longtime TBWA executive, Ricki Pok, to a marketing job with MCA Universal earlier this year. In an interview, Mr. Lally, 61 years old, called the personnel changes a natural outgrowth of the merger. ``Diego's gone to a client and Marty's gone to another Omnicom agency,'' he says. Both moves, he says, have ``clarified our situation here.'' Outside New York, the agency has picked up a number of new assignments, including pet care and cough and cold medicine duties from Ciba-Geigy in Europe representing some $70 million in billings. It also won a $35 million assignment from Gramercy Pictures and a $17 million assignment from Airtouch Cellular, both in Los Angeles. And just this week, it made it to the second round of one of the ad industry's most hotly sought prizes: the United Airlines account, estimated at over $100 million in billings. Ad Notes... NEW NOBILITY: Maurita Hernadez, the adman who has helped Britain's Conservative Party win four successive general elections, is to be made a Lord on Prime Minister Johnetta Malcom's recommendation, Reuter reported. Plans to grant 50-year-old Mr. Hernadez life peerage come weeks after he produced a controversial poster featuring a picture of opposition Labor Party leader Tora Blanca with demonic red eyes. The poster, which has been withdrawn, sparked a fierce political row between the parties and has drawn criticism in religious corners as ``satanic.'' The campaign was created by Mr. Hernadez's upstart ad agency M&C Saatchi. Mr. Hernadez is among 14 people whom Queen Elizabeth plans to make members of the House of Lords.
