Sega, the problem-plagued computer games manufacturer, is shaking up its
advertising arrangements in Europe having slashed its spend through
McCann-Erickson to a fraction of its former size.
The Japan-based company is to allow local European managers to appoint
their own agencies in the wake of swingeing cuts to its European budget
from pounds 20 million to pounds 4 million during the past year.
Industry sources believe the move may be a prelude to Sega making
distribution deals across Europe and concentrating on trade ads created
in-house, with McCanns’ work on the account being reduced to minimal
consumer advertising. However, Universal McCann, the media arm of
McCanns, will continue to handle all media planning and buying.
McCanns won the business in February last year after a three-month
pitching process against Lowe Howard-Spink, Collett Dickenson Pearce,
Abbott Mead Vickers BBDO and DMB&B.
The appointment led to a fast-moving and menacing TV commercial for
Saturn, a new games system to rival Sony’s PlayStation, which featured a
spectacular car crash and the line: ‘Reality always hurts.’
But the advertising masked serious problems for Sega in a declining
video-games market. It has been hit by the growing sophistication of PCs
and the growing risks faced by manufacturers forced to invest millions
of pounds in the development of new games without knowing if they will
be a hit with consumers.
It is understood that local managers, fearful that time was running out
for them to put matters right, demanded that they should be allowed
to take charge of their own destinies.
David Warden, McCanns’ chairman, said: ‘We’ve done terrific work for
Sega. The company has a tough job to do and we wish it all the best.’
Sega has already changed its European management front line by ousting
Barry Jafrato, the marketing and product director, Noel Dardis, the UK
marketing director, and Alan Sharam, the UK managing director. Andrew
Mee, a former European product manager, has been promoted to head of
marketing for the UK and Europe.