Agencies were this week seeking reassurances about the future of
millions of pounds worth of business after PepsiCo’s decision to spin
off its fast-food chains.
They are anxious to know whether the demerger and creation of an
independent company to run the Pizza Hut, KFC and Taco Bell operations
will put long-term relationships in jeopardy.
In the UK, the pounds 8.2 million KFC account has been handled by Ogilvy
and Mather for three years while Abbott Mead Vickers BBDO picked up the
pounds 6 million Pizza Hut business in 1995 as a result of an
international realignment within the BBDO network.
Reports circulating in the US suggest the change could put pressure on
BBDO’s grasp on Pizza Hut, which has been sustained by the close
relationship between Phil Dusenberry, BBDO’s creative chief, and Roger
Enrico, PepsiCo’s chief executive.
The move to float off PepsiCo’s restaurant division as an independent
company comes in the wake of intensified competition in the US fast-food
market, which has hit the company’s profits, and the unsuccessful
dollars 500 million Pepsi ’blue’ relaunch.
Agency sources in the UK anticipate that any change to advertising
arrangements are unlikely to happen quickly.
’It’s early days and advertising will be well down the list of
priorities of the new company,’ one source commented.
A PepsiCo senior executive said: ’I can’t see the change having any
implications for agencies at the moment.’