Sainsbury's poised to award £115m media account to PHD in stunning U-turn

Sainsbury's is poised to award its £115m media account to PHD in a stunning U-turn, four months after rival agency M/SIX won the business.

'Sharing the gift of Christmas' by PHD and Sainsbury's: created for the supermarket's 2015 festive campaign
'Sharing the gift of Christmas' by PHD and Sainsbury's: created for the supermarket's 2015 festive campaign

It would be one of the biggest upsets in recent UK advertising history and a coup for PHD and its parent company, Omnicom Media Group, which challenged the result of the original account review in February.

OMG claimed that Sainsbury’s did not conduct the process fairly and took its complaint to the retailer’s board of directors, which ordered the review to be reopened.

The UK ad industry has been waiting for months to hear how Sainsbury’s would resolve the drama.

The saga of the account review began last autumn when Sainsbury’s decided to consolidate the £62m Sainsbury’s account, which PHD had held for 22 years, and the £53m Argos/Home Retail Group business, which Mindshare previously ran.

Sainbury's bought Argos last year and is keen to make cost savings.

The FTSE 100 retailer invited only PHD and M/SIX, a joint venture between The & Partnership and WPP, to take part in the secret process.

Mindshare did not compete because it had a conflict as Marks & Spencer is a client.

Sainsbury’s awarded the business to M/SIX on 8 February but it is thought that OMG launched a challenge almost immediately.

Campaign revealed on 23 March that the supermarket had reopened the review.

Sainsbury’s prides itself on treating suppliers fairly and has an appeals process.

The supermarket giant’s board looked into the way the original review was conducted and it is believed M/SIX and PHD were asked further questions about pricing and how they would manage the business.

Sainsbury’s would not comment on whether it plans to overturn its decision to give the business to M/SIX and to award it to PHD.

A Sainsbury’s spokesman said: "This process is ongoing."

Omnicom Media Group and M/SIX declined to comment.

One senior agency figure, who was not involved in the Sainsbury’s process, said: "I’ve never known a review to be re-opened like this."

It is thought that Sainsbury’s has not moved its account to M/SIX during the four-month limbo period between February and June because of the appeal.

If Sainsbury’s drops M/SIX, it will be a blow to the agency, which has been growing fast and won Toyota across Europe last autumn as part of an integrated pitch with other agencies from The & Partnership.

It would also be a blow to WPP, which listed the Sainsbury’s win in its investor presentation when it published its first-quarter results in April, although news of the win was subsequently removed from the online version of the presentation.

Campaign included M/SIX’s win its weekly table of new business wins too.

OMG may have been keen to fight to keep the account because PHD has produced a strong body of work for Sainsbury's. This included "Sharing the gift of reading", which won the Grand Prix at the 2016 Media Week Awards.

Sainsbury’s previously shocked Omnicom when it moved its creative account from PHD’s sister agency, Abbott Mead Vickers BBDO, after 35 years and gave it to Wieden & Kennedy.

The & Partnership's agencies continue to have a strong relationship with the Sainsbury’s group. CHI & Partners handles creative and All Together Now looks after content for Argos.

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