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Carat in line to scoop $3bn General Motors global media account

A strong rumour suggests Carat has scooped the $3bn General Motors global media buying and planning account, which has been under review since August.

If true, this outcome amounts to a huge blow for Publicis Groupe, which services the majority of the account through its media specialist Starcom MediaVest, and – by the same token – a big fillip for Aegis, owner of Carat, the publicly listed company steered by Jerry Buhlmann.

The review, one of the biggest of its kind in the world, was instigated by GM marketing supremo Joel Ewanick as part of a slew of measures designed to tighten up the automobile giant’s worldwide marketing performance.

Before the review, GM used up to 20 media specialists. However, the bulk of the spend – two-thirds in fact – is committed to North America (the Chevrolet, Buick and Cadillac marques), and much of that has passed through Starcom since 2005. Carat, which has been on the GM roster for a slightly shorter period but consolidated its hold during a 2010 review, handles the $500m European business (Opel and Vauxhall). Interpublic’s Universal McCann was responsible for much of the Latin American business.

Although the review was slated as “global”, it did not in fact include GM’s operations in nascent markets India and China. What it did include, according to the briefing notes, was “digital…, SEO and social media.”

If Ewanick has stuck to his word and included these in the consolidated Carat package, his decision will represent a double-whammy for Publicis. Back in the summer, PG boss Maurice Lévy sought to shore up his position in the increasingly important GM digital account by taking a 51% stake in Big Fuel, which holds the North American social media account. The acquisition was aligned under the Vivaki digital unit.

What we don’t know, of course, is how profitable the account will be for Aegis. In their desperation to win an account, media men often allow their competitive negotiating instinct to overcome more rational arithmetical considerations, and pare the margins down to the bone in an all-out attempt to win. That said, a win will do Aegis’ share price no harm at all. And, being on a roll, Buhlmann can expect more clients to put him and his team at the top of their shortlists.

 

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