GGT denies job cuts as Nationwide quits shop

GGT has claimed it will make no redundancies after the loss of its flagship client, the Nationwide Building Society, which pulled the plug on its pounds 14 million account this week.

GGT has claimed it will make no redundancies after the loss of its

flagship client, the Nationwide Building Society, which pulled the plug

on its pounds 14 million account this week.



The Nationwide, which paid millions of pounds to sponsor the football

league this summer, failed to renew GGT’s contract last week, declaring

that it was ’no longer necessary’ to retain an agency on a full-service

basis. According to a spokesman for the building society, management is

still in negotiations with the GGT/CIA media joint venture, Media

Solutions, about whether to retain it for media planning and buying.



’It is our intention to remain, but, as you will expect, there is an

element of negotiation,’ the spokesman said. He declined to comment on

whether the company was talking to any other media companies.



On paper, the loss of GGT’s largest client will wipe out a quarter of

its billings, which were estimated at pounds 58 million in the year

ending June 1996 (Register-MEAL). However, the GGT managing director,

Grant Duncan, claimed the move was more than compensated for by the

agency’s Telewest win early this year.



’These things happen. Nationwide is clearly pursuing a new strategy,’ he

said.



Duncan added that the loss would have no impact on the GGT group’s deal

to buy the French BDDP network, which is at a sensitive stage at the

moment.



Shares in GGT are currently suspended on the stock exchange, probably

until the end of February, while the chairman, Michael Greenlees, raises

the necessary finance for the deal.



Nationwide claimed it parted company with GGT because it now had a clear

communications strategy in place and didn’t need a full-service agency

to run it. A spokesman denied that it was a cost-cutting measure to help

finance its football sponsorship deal.



Nationwide’s current marketing strategy focuses on the ’Nationwide

savings challenge’. This encourages the public to call in on a freephone

number to check whether their savings or mortgage rates are as good as

those the building society can offer.



GGT’s two latest television commercials for Nationwide have been topped

and tailed with the challenge’s telephone number.



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