Close-Up: Live Issue - Where does United London go now?
campaignlive.co.uk, Friday, 08 December 2006 12:00AM
Is WPP's continued support for United London justified after the loss of Sky, Claire Billings asks.
WCRS's BSkyB win last week raises two interesting questions. Just how did the agency manage to snatch the £75 million account from under Sir Martin Sorrell's nose, and does WPP's loss spell the end for United London?
While the former is shrouded in mystery - none of the WCRS management will discuss the win - the answer to the latter is a resolute "no". Robert Campbell and Jim Kelly, the United managing partners, are now plotting a restructure of the agency.
The pair, brought in to revive the agency's fortunes in January, are in discussions with WPP about what form the agency should now take.
It will come as a surprise to some in adland that WPP is bothering to save United London, given that the agency has been on a downward spiral since 2000, when HHCL, as it was previously known, was named Campaign's Agency of the Decade.
In the two years that followed, it lost the AA, Egg, ITV, Martini, Tango, Texaco and Thomson Holiday accounts. There was a brief reprieve in 2003, when it won Sky and added Innocent Drinks, Godiva Chocolates and Kiss FM, only to lose Iceland and Godiva in 2005. Its chief executive, Nick Howarth, who was close to Sky, also left.
Sorrell is determined the United Group, which was constructed to rival Fallon, Wieden & Kennedy and Bartle Bogle Hegarty, should work. For that, it needs a strong London office. United's agencies in Milan, Madrid, Buenos Aires and Seattle are performing well. Even Berlin Cameron in New York is said to be returning to form after its Coca-Cola loss last year.
London's wins this year - COI's Alcohol Harm Reduction, the relaunch of Masterfoods' Tracker brand, Early Learning Centre and thelondonpaper, along with existing business - pale into insignificance against the Sky loss.
The account represented an estimated 70 per cent of the agency's billings, which were £91 million in 2005, according to Nielsen. Kelly and Campbell are relieved that Sky, which Campbell describes as "like having a rhinoceros in a bedsit", has gone.
The fraught relationship between Sky and United is said to have stemmed in part from the prominent role Sky's design agency, Venture Three, played in the development of the broadcaster's marketing strategy.
An insider explains: "It was a difficult relationship with Venture Three in the middle. Two experienced managers with fresh eyes didn't feel that Sky was a foundation on which to build the agency."
The agency now has 25 staff - a dozen left after the Sky loss, including six who are expected to join WCRS under a TUPE transfer. So with a brief to start over, what can Kelly and Campbell do? Other than to say the restructured agency will be an ideas-based, multidisciplinary agency, they are keeping their cards close to their chests.
Lee Daley, the chairman and chief executive of Saatchi & Saatchi, held the same role at HHCL and was the head of the Red Cell (now United) network. He believes the London office needs to focus on creativity. Amanda Walsh, the former United president and the current chief executive of Lowe London, thinks it should be the network's international headquarters.
Kelly and Campbell are in discussions with WPP about raising their equity stakes, but whether or not they concoct a winning formula remains to be seen.
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CHIEF EXECUTIVE - Amanda Walsh, chief executive, Lowe London (former European president, United)
"Jim and Robert are proven entrepreneurs, and this is important because United has an entrepreneurial and creative philosophy and culture. They believe they can build a strong London office that can be the hub of the international network.
"The reason we brought them in was to build the global hub of the network. The global people would be based there. Global and local would merge, which is why they didn't put their names above the door. But I personally think they should put their names above the door because they are proven entrepreneurs and, therefore, have the right personality and background."
MATCHMAKER - Martin Jones, managing director, AAR
"There's clearly a place for United London, both within the WPP Group and the wider industry, in as much as it's a meritocracy.
"Agencies can often turn losing a large account into a benefit - prospective clients will assume they're disproportionately hungry for new business. Clients are interested in small agencies where they can talk to top talent; agencies where there's a place for them and where they won't become lost.
"United London is a good quality restart-up and that can be a compelling proposition: for the first 18 months of a start-up's life, it will often get business from opinion formers, media agencies and people they know who want them to do well."
CHIEF EXECUTIVE - Lee Daley, chief executive,Saatchi & Saatchi (former global chief executive, Red Cell)
"I think they need to get their business back on track. I think Jim and Robert can do that. I think Sorrell will be committed to it and they can execute it. What's at the centre of it must be brilliant creative delivery.
"However they tailor their proposition, from a branded communications point of view or whether they're going to mix their model, what will be key is the strength of creative. Robert and Jim have a history of being associated with effective creative in conventional advertising, but obviously they'll begin to embrace other content. And they might want to mix up the business model in terms of how they get paid."
GLOBAL CHIEF EXECUTIVE - Andy Berlin, global chief executive, Voluntary United Group of Creative Agencies
"Sir Martin Sorrell is unequivocal in his support. We need a vibrant agency in London and we're committed to that. Our headquarters are in London and we need to make that work. We are unusually dedicated to it.
"We're focused on our mission and our clients. We want to build a very good creative group and everyone who's in it is serious about that. A number of agencies in the group are exceptional, and among the best in their markets.
"United has not lost money as a group. London is one office and Sky was a big account and there are a number of people, and I can't say this myself, who view this loss as liberating."
This article was first published on campaignlive.co.uk
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