Glaxo briefs roster for global contest

Glaxo SmithKline is overhauling its global roster of creative

agencies for its consumer healthcare business and is planning to

introduce new contracts rewarding agencies on a performance-related

basis.



The healthcare giant will ask agencies from its existing roster to pitch

across its business and will put new standard service-level agreements

in place with the winning agencies.



The brands included in the review in the UK, which are currently split

between Grey, Ogilvy & Mather and McCann-Erickson, will be Ribena,

Lucozade, Horlicks, Aquafresh Beechams, Mac- leans and Niquitin.



Neil McCrae, the director of communications for GSK consumer healthcare,

Europe, said: "We are carrying out a global creative review of our

advertising agencies for our consumer healthcare business. We are

seeking to introduce new standard service- level agreements for creative

advertising agencies and have therefore given formal notice on existing

contracts.



"The new service-level agreements will be applied to all of our agencies

and will be designed in part to reward results and quality of service.

We believe this move to a results-orientated approach, which is in line

with industry trends, will benefit both our consumer healthcare business

and our agencies in the long term."



The winning agencies will be put in place no later than January next

year and only incumbent agencies will be invited to pitch.



GSK's roster of agencies on its consumer healthcare business also

includes Dentsu, Grey Worldwide, Jordan McGrath, J. Walter Thompson,

McCann-Erickson, Ogilvy & Mather, Publicis and a number of smaller

regional agencies.



The pitch will be handled by GSK's International division. McCrae said

it was too early to say whether the company was looking to whittle down

its roster of agencies or how many incumbents will be asked to pitch for

the business.



GSK's decision to review its consumer healthcare business follows its

move in the spring to look at its roster of agencies on its US

prescription drugs accounts as GSK began to examine ways of achieving

cost savings following the merger of Glaxo-Wellcome with SmithKline

Beecham last year.



Last September GSK appointed M&C Saatchi to work on its pounds 20

million corporate branding campaign for the newly merged entity

following a head-to-head pitch against O&M.



Rewarding agencies on a results basis echoes Procter & Gamble's bold

move two years ago to move from a commission-based system for agencies

to a system linking agency pay to the sales of its brands.



GSK media review, p5.