LH-S plans global media operation

Lowe Howard-Spink is to form a global media buying operation with its Interpublic sister agencies, Western International Media and Initiative Media.

The new operation, which was revealed during the centralisation pitches for Lloyds Bank/TSB this week, is provisionally called Western Media Europe. Ironically it follows the end of negotiations with the CIA Group, one of the agencies it is pitching against for Lloyds Bank/TSB.

The operation will be headed by Mike Smallwood, currently media director of LH-S, and will take in all of the Lowe Group’s media clients across the world.

Actual media buying for LH-S and Initiative’s clients will remain separate, but the two will pool their billings to conduct joint negotiations with media owners.

This will give LH-S the billings volume it has been looking for, enabling it to strike more competitive deals.

The new company will also allow the two media agencies to merge their backroom operations such as finance, administration and bespoke research.

Initiative will use the new company as a second media brand to handle conflicting clients.

The company is also to use the Western International connection to target US clients which use different media buyers in Europe.

The rationale for the move is twofold. One by one the UK’s advertising agencies have abandoned the full-service model – most recently Abbott Mead Vickers. BBDO through its acquisition of Pattison Horswell Durden (see Media, page 12) – as they seek bigger billings to enhance their buying clout and LH-S is following that trend.

In the past year it has conducted merger negotiations with PHD as well as the recent short-lived talks with CIA Group.

The second impetus for the move has been international. The Lowe Group has been on the acquisition trail in Brazil, South Africa and France since last year and has told Interpublic it will have a global network by the end of 1997.

As part of that strategy the company has been looking for a media solution to enable it to replicate the calibre of the London media operation across the group.

A previous attempt was made in the form of Universal, a pan-European network composed of the media departments of LH-S and Interpublic sister agency McCann-Erickson. That attempt foundered in October last year because of a difference in cultures between the two agencies.

Western International Media, the US’s second largest media buying operation with billings of about $1.7bn (1.1bn), was bought by Interpublic in October 1994 for $50m (32m).

Initiative Media, while a well-established global media brand in its own right, has been attempting to lessen its dependence on Unilever.

All the agencies involved declined to comment.