After Coca-Cola spent 11 months reviewing its global marketing, the iconic advertiser finally found a winning partner in the world’s largest advertising holding company, WPP. Monday’s announcement, however, left more questions than answers about the review.
Coca-Cola’s initial announcement highlighted WPP as the big winner, taking on media buying for all markets, with the exception of a few select markets in Asia where Dentsu has a strategic advantage. In total, it amounts to more than 90% of the media business falling to WPP.
On the creative front, WPP shops will lead a number of strategic partners, including McCann, Mercado and Leo Burnett. Coca-Cola global CMO Manolo Arroyo told Adweek WPP will receive a minimum of 65% of the creative work.
Wieden+Kennedy and Havas’ full-service agency BETC are among a number of shops that have recently executed work for Coca-Cola brands, but at this time, Coca-Cola has not confirmed whether they will remain on the roster.
Coca-Cola’s decision to combine the creative and media business into one review over the summer allowed WPP to pull into the lead because its global reach and size allowed it to meet the company’s terms. The review has industry-changing implications, impacting billions of dollars and leaving thousands of agencies that previously worked with Coca-Cola looking for ways to replace the hole left on their client roster. Coca-Cola’s decision also sends reverberations through competitors’ businesses as WPP handles media buying in a number of territories for rival Pepsi.
“For WPP, this continues on their strong momentum outside the U.S. and gives them traction inside the U.S.—their creative agencies have struggled for North American growth, but this, along with the Unilever announcement, should be the impetus to drive the holding group forward,” said Greg Paull, co-founder and principal of consultancy R3.
WPP and OpenX
Unlike some bespoke units that pull talent from specific agencies within a network, WPP’s dedicated OpenX unit will allow Coca-Cola to work with any agency within the WPP network, Arroyo said. This provides the flexibility to use WPP talent across the more than 200 countries and territories the company currently operates in.
Arroyo said the model is designed to integrate WPP’s capabilities from end-to-end. Ogilvy, Wunderman Thompson and MediaCom have some of the strongest existing ties on the WPP roster within OpenX to Coca-Cola across the globe. Coca-Cola’s data and production also fall under WPP’s remit, supported by its new data offering Choreograph, and Hogarth, WPP’s production company.
According to COMvergence, GroupM handles about 24% of Pepsi’s media spend, with that largely coming in various Asian markets and Russia. Currently, Omnicom Media Group also handles 72% of Pepsi’s spend globally with other holding groups and agencies in charge of the remaining sliver.
SOURCE : adweek
