Daimler Chrysler has shifted its entire £1.25bn business to Omnicom's BBDO creating the world's biggest single car account.

The decision, made late on Friday, ends a fierce two-month battle for the business between the Chicago-based True North and the New York-based BBDO network.

David Bell, chairman and chief executive at True North, said: "We're disappointed that the superior quality of our global work and our experience in integrating business from other agencies for Chrysler Group did not seem to be the critical drivers that we'd anticipated."

The result marks a serious setback for True North as it sees £97m, or 9% of revenue, and up to 15% of earnings wiped off its business overnight.

It also poses a huge threat to True North's independence. Losing the business makes it vulnerable to a takeover by other groups, including Interpublic Group of Companies or the Publicis Group.

The knock-on effects in the UK, where Mercedes-Benz and Jeep are its biggest brands, are widespread. Banks Hoggins O'Shea/FCB in the UK will lose its £10m Jeep and Chrysler accounts. FCB Worldwide handles Jeep and Chrysler, worth £294m a year, while BBDO Worldwide is responsible for the £309m Dodge brand, which does not exist in the UK.

Omnicom is the second biggest agency worldwide after the WPP Group, and number three in billings behind WPP and Interpublic.

True North is ninth in revenue and eighth in billings.

Mike Vogel, chief executive of FCB Detroit, said: "Our focus is now on replacing this business and finding the next set of challenges for our agency."

The Mercedes-Benz business, which is handled in the UK by Partners BDDH, is not affected by the switch.

 

By: Jade Garrett | From: The Guardian

By: admin


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