The global review of Mars’ $400m (£263m) business has been thrown into confusion by Ogilvy & Mather’s surprise withdrawal from the pitch.
The agency was tipped to pick up most of the business. But it has dropped out of the race because of client conflicts, which everybody else was signposting when the review first got under way. It is thought Mars wanted O&M to work on confectionary as well as petfood.
An O&M New York source explains the agency rationale: “When Mars launched this review we had little knowledge of their business structures and it never outlined exactly which brands were being reviewed. It would have been foolish not to have spoken with Mars.
“But ultimately it became clear that there were too many potential conflicts and we had to get out before Mars actually came to a decision.” The final results of the review, which began in November, are expected later this week.
O&M was pitching against incumbents Saatchi & Saatchi and Bates Worldwide as well as D’Arcy Masius Benton & Bowles, Grey, BBDO, Bozell Worldwide, and US agencies Deutsch, Earle Palmer Brown and Merkeley Newman Harty.
A statement from O&M says: “Our participation in the review was always contingent on an ability to work with Mars without disruption to our existing clients. Following lengthy discussions with Mars, it is clear that there is no combination of assignments that would allow us to honour our commitments.”
But others have suggested that the O&M presentation was lacklustre. This was challenged by Mars spokesman John Murray: “We had presentations in the form of conversations with O&M and as they continued we became aware of a growing incidence of conflicts.”
As part of the pitch each agency was given a project with a specific brand to work on – O&M worked on Whiskas. However, the projects assigned to the agencies do not necessarily mean they will gain that part of the Mars business. It is understood the winners will be expected to work across at least two of Mars’ five business categories, including petfood and confectionery.
O&M handles rival Spillers pet food, Prime, in the UK but observers say that in terms of billings O&M would have been prepared to sacrifice that in return for a bigger slice of Mars business.
However, this week it became clear to O&M which particular brands it was to compete for and that these would have a problem with Dalgety, Unilever, Nestl and the £75m billing Hershey with which it works in the US. O&M has made an agreement with Mars not to discuss the brands it was asked to pitch for.
The statement continues: “The review began six weeks ago. At that time it was unclear to O&M – and in fact to all the participants in the review – the nature scope and geography of the pending assignments.” However, O&M adds: “As of yesterday [Monday] it became clear that continuing the dialogue would be disruptive to a number of O&M clients including Hershey, Nestl, Philip Morris and Unilever among others”.
While some of the client conflicts may not be obvious, all the companies involved jealously guard their brands. A source says “The conflicts may be one two or three steps removed. For example Unilever is involved in ice- cream and so is Mars – even though an agency may be working on a totally separate category it is still viewed as a conflict.”