For as long as anybody can remember, Unilever and Procter & Gamble
have behaved like parallel universes in which action by one provokes
reaction by the other.
So it was almost inevitable that 19 months after P&G declared its
intention to move away from the commission system to payment by results,
Unilever should also be overhauling the way it rewards its agency
Yet although the leviathans have converged over agency compensation,
they now show significant differences in their advertising
While P&G shows little inclination to extend its business beyond a small
core of international networks, Unilever is always willing to look
outside its global "club" agencies and embrace creatively-led local
shops, which are claiming an increasing percentage of its ad budget.
That strategy was further underlined last week when Unilever bolstered
its relationship with Mother by assigning it the relaunch of Lever
Faberge's Organics haircare range in the UK.
Unilever's policy is a legacy of the time when it still had a
1,600-strong product portfolio now being culled to just 400 "power
brands" by the company's chairman, Niall Fitzgerald. As long ago as the
mid-80s its Brook Bond Oxo division first broke ranks to assign the Red
Mountain coffee business to the then-creatively potent Still Price Court
Six years ago, Simon Clift, then Elida Faberge's marketing director,
headed in a similar direction. Dissatisfied by the creative work Lintas
was producing on Lynx body spray, he switched the work to Bartle Bogle
Hegarty, where the account complemented the agency's existing
assignments for Stork margarine and Olivio olive oil, won in 1992.
HHCL & Partners was later hired to handle Birds Eye ready meals.
"Agencies such as ourselves, BBH and Mother have made Unilever feel good
about ensuring that their international agencies shape up," Robin Aziz,
HHCL's chief executive, says.
Mother became part of the Unilever agency family after a call from its
Van den Bergh subsidiary in April 1997 asking if it would contest its
Bachelors SuperNoodles account. The Organics assignment extends a
relationship cemented with the SuperNoodles campaign.
Today, the agency faces a formidable challenge in transforming Organics
into a serious rival to P&G's Pantene, which is itself backed by a
pounds 10.5 million spend. But Stef Calcraft, one of its founding
partners, dismisses the notion that Mother is a "wild card".
"Unilever recognises that, as a young agency, we can have a higher
proportion of senior people on its business," he says. "We're actually a
Unilever insists that its priority remains long-term relationships with
core global networks - Ogilvy & Mather, Lowe Lintas & Partners, J.
Walter Thompson and McCann-Erickson - because of the need to have
resourced advertising support in every market.
"We aren't skittish but as global communications become easier it allows
us the opportunity to take some mistresses." a senior executive
P&G's roster networks, which include Saatchi & Saatchi, D'Arcy and Grey,
continue exuding confidence, however. This is despite P&G's series of
profit warnings and a sweeping restructure involving more than 17,000
Understandably, P&G agency chiefs welcome the company's centralised
system, with few and clear lines of communication unhindered by local
shops, and reject any suggestion of formulaic work.
"We showcase our P&G work as much as that of any other client because we
believe it's as good as the company will get anywhere," a senior manager
at a P&G network agency boasts.
"The more emotional needs of brand communication have got through to P&G
over the last five years and that's reflected in the quality of the
advertising," he adds. "Unilever may have held the emotional high ground
in the 70s and 80s, but it's not true any more."
P&G's unswerving loyalty to its networks has advantages. Agencies will
always play safe if perpetually worried about being sacked and will be
bold only if they know their tenure is secure. The axing of the
commission system is seen by the company as a route to more creative
But some commentators argue that with P&G's stock now valued at only 55
per cent of its worth two years ago and Wall Street's nervousness, P&G
is forced to be risk-averse rather than radical.
They also believe that looking outside the roster for creative work is
easier for Unilever, which has developed deep relationships with its
media partners, epitomised by its communication channel planning
strategy. "With the media sorted, it's much easier to ad hoc the
creative work," a source close to P&G comments.
Nevertheless, Unilever has a delicate balance to strike. BBH's
appointment to handle the global creative assignment for Bertolli olive
oil is said to be heightening fears among the "club" networks about the
Meanwhile, there's a limit to the work Unilever can assign outside its
core agencies while insisting they don't take conflicting business.
Some, though, believe that for both Unilever and P&G there's no going
back and that to do so would be like trying to squeeze the toothpaste
back into a tube of Crest. As Calcraft puts it: "Once you start
extending your creative thinking you have to work with the best people -
wherever they are."