Cannes awards spat masks war to the needle between de Nardis and Sorrell

WPP chief Sir Martin Sorrell has rightly been basking in the reflected glory of the Cannes sunshine. Three successive years, three successive triumphs as holding company of the year at the International Festival of Creativity. It’s the pinnacle moment for a strategy – his own as it happens, but one for which worldwide creative director John O’Keeffe has done all the hard implementation – designed to kick into touch that old myth about Omnicom’s creative supremacy.

Martin, they used to say, has Asia (meaning he’s a shrewd strategist) but John (Wren, Omnicom CEO) has all the brands. Not any more. In the eternal battle for Cannes “statues”, WPP notched up a convincing lead of 2067 points over Omnicom, in number two position with 1552. Publicis Groupe trailed in third place with 989.5 (where did that half-point come from? No idea). Just to rub the triumph in, a leading WPP agency, Ogilvy & Mather, became the first network ever to win more than 100 lions and its Sao Paulo shop was named agency of the year. So now Martin can boast about having the brands, as well as Asia. Which is more than Alexander the Great could ever do.

But when it sounds too good to be true, it usually is. A few days after the festival ended, news that Omnicom was crying foul over the final Lions tally left Sir Martin spluttering into his breakfast of fresh strawberries at Connaught’s. His temper will not have improved on learning the identity of the trouble-fête behind all this mischief: none other than Mainardo de Nardis, CEO of Omnicom’s principal media planning and buying network, OMD Worldwide. Mainardo (pictured) and Sir Martin go back a long way…

More of that in a moment, though. First, let’s get down and dirty with some relatively boring Cannes festival award technicalities. The substance of de Nardis’ complaint is that WPP media company GroupM has massively over-claimed in putting out a statement – last Wednesday – saying it had won 45 awards, more than any other media agency holding company. Not nearly so, according to Omnicom. Thirty of the Lions (i.e., awards) claimed by GroupM are not verified on the Cannes Lions winners’ website.

Doh? Well, a majority of GroupM’s wins should be disqualified because its subsidiary agencies were not specified in the original competition entry. WPP may well have won something, on the creative side, but for whatever reason, failed to catalogue the media achievement. After the wins were announced, according to Omnicom, GroupM assiduously went back to each entrant agency and requested they be listed as the media shop for the work.

“Gaming the system,” says de Nardis, and a clear violation of the Festival’s rules in spirit if not in the letter (Cannes does make allowance for a few genuine oversights, but not wholesale ones). “Rubbish,” responds GroupM: just a few inadvertent errors and when the Cannes deadline for amended entries is published tomorrow (July 5th), all will be vindicated.

OMD, by the way, won 19 awards, which are seemingly confirmed on the Cannes website. So, if we subtract 30 from GroupM’s claimed 45, we can see that OMD has everything to play for.

All this might seem a storm in a teacup to most readers. But fuelling Sorrell’s irritation is some history. Mainardo de Nardis was once a senior WPP executive and the relationship with Sorrell did not end pleasantly.

Specifically, de Nardis headed WPP’s CIA.mediaedge, these days called MEC, before leaving for Aegis in 2006. Ironically, in view of what has come later, it was WPP which accused de Nardis of not abiding by the rules. Indeed, it became so convinced that de Nardis was playing a double game – working for a rival while still on WPP gardening leave – that it issued legal proceedings against him. Interestingly (from a revelatory point of view), the matter went to trial and quite a lot of Machiavellian shenanigans tumbled out concerning de Nardis’ relationship with Marco Benatti, another former WPP executive who was at that time country manager of CIA in Italy. Although they have managed to fall out from time to time, de Nardis and Benatti were (and probably still are) closely tied by family and business interests – for example, they once ran Medianetwork Italia. Benatti was himself the subject of WPP court proceedings, for alleged breach of fiduciary duty in failing to disclose a major holding in an Italian company, Media Club, which he had helped to acquire on WPP’s behalf in 2002. The trial lumbered on until 2008. Anyone interested in the minutiae of these (apparently) dusty events might look here and here.

So, nothing personal in this statues kerfuffle, eh? One other thing guaranteed to pour salt into old wounds is the prestigious Chanel account, recently up for repitch. Incumbent media agency? MEC. Prospective winner (according to the gossip at Cannes, possibly generated by de Nardis himself): OMD. Actual winner, declared yesterday: WPP, in the guise of a new bespoke agency, Plus – which harbours elements of MEC and Mindshare in its media-buying element.

Richard Pinder launches global network with Maserati as a client

After years of being a jet-setting senior suit in someone else’s service, Richard Pinder has decided to go global on his own account with the ambitious launch of international network The House Worldwide.

Pinder, it will be recalled, was head of Publicis Worldwide for five years until group succession politics (the imposition of Jean-Yves Naouri as executive chairman) made further tenure of his position unrealistic.

That was two years ago. Since then, Pinder has been pondering how to cash in on his experience with global clients (he’s worked for over 25 years in Asia, Europe and the USA; for Leo Burnett, Ogilvy & Mather and Grey, as well as Publicis) by building a new-model worldwide agency network.

No mean cliché, the cynic will object. We’ve heard the rhetoric before. What’s the reality?

It’s true that the agency world has long been struggling with a “post-analogue” structural solution to the increasingly financially unviable traditional creative agency network, with its army of regional bureaucracies. Some have proffered a solution in the form of the fleeter-footed international micro-network (step forward BBH, Wieden & Kennedy and – in its heyday – StrawberryFrog.

Pinder, however, has gone a step further in presenting a top-down managerial solution – or perhaps that should be management consultancy solution – in place of the piecemeal creative one. His starting point is that the traditional global advertising business – unlike professional counterparts such as lawyers and accountants – loses most of its senior talent to the management of regional geographic fiefdoms, which are there primarily because of historical legacy. What this talent should be doing is servicing the client’s agenda rather than their own corporate one. The exception, where the client really can insist on top-level personal service, is a vanishingly small number of mega-clients, such as Ford and Procter & Gamble, which have specially structured teams to pander to their requirements.

Pinder’s idea is to provide this level of service for global, or at least international, clients further down the budgetary league table. Each client should be serviced by no less than three senior people at any one time. To do this, he has joined forces with a core team of like-minded senior executives: initially, Peter Rawlings, former chief operating officer DDB Asia, Chris Chard, former chief strategy officer of Lowe Worldwide in New York and Ben Stobart, former senior vice-president (chief suit) of Burnett Chicago. These will deal directly with top clients on a day-to-day basis; the specialist skills base, on the other hand, is to be provided by a network of over a dozen associated network companies, of which the best known is Naked Communications (see AdWeek for a full list).

Note the absence of an overall chief creative officer. This is deliberate: Pinder does not believe a single individual can adequately address the creative needs of all client types.

Why is Pinder convinced this model can operate from a single fixed geographical location (well, actually two in THW’s case – London and Singapore)?  Because of consolidation on the brand management side. More and more marketing power is being concentrated into the hands of Chief marketing officers and indeed chief executives; less and less being delegated to regional and country power bases.

But, the acid test is: has Pinder got any clients? Yes he has. He has been collaborating with two over the past year in honing the organisational structure of THW, during what he calls “beta mode” (how digitally au courant).

And they are? Maserati and an upmarket specialist haircare brand, GHD (stands for “Good Hair Day”). Both, he tells me, are poised at an interesting fulcrum of development, from the brand and new product point of view.

Maserati, an ultra luxury sports car marque lodged in the Chrysler/Fiat stable, has been given a €1.6bn injection to broaden its model range and take on Porsche.

GHD – which produces premium-priced hair stylers – is also cash-rich after being bought for £300m by Lion Capital. Lion is investing in npd, with a view to bringing GHD out of the salon and onto the international stage. Inevitably, that is going to involve careful brand positioning as GHD moves into a broader market segment.

However, Pinder is coy on the subject of who, apart from Maserati and GHD, is bankrolling all of this. It seems likely that both principal founders (Pinder and Rawlings) have skin in the game. But a project of this scope is financially beyond most individual investors, even if they are relatively wealthy admen. Private equity seems to the answer. Among the list of network associates is, rather intriguingly, a UK-based hedge fund called Toscafund, whose chairman is former RBS bigwig Sir George Mathewson. Pinder claims Toscafund is very handy on the “analytics” side. No doubt. But my guess is it’s providing a lot more resource than that.

Yes, we Cannes: WPP, McDonald’s and McKinney grab top Effie Index rankings

It might seem counter-intuitive to announce the global Effie ‘Effectiveness Index’ winners at the Cannes International Festival of Creativity but then, as my colleague Stephen Foster points out, Cannes has become such a monster event it serves as global launchpad for virtually any marketing services event these days. So, before becoming immersed in a week-long self-congratulatory orgy of advertising creativity, let’s just remind ourselves of those advertisers, brands and agencies that actually bring home the bacon:

• Unilever is the most effective advertiser;
• McDonald’s is the most effective brand;
• WPP Group is the most effective advertising holding company;
• Ogilvy & Mather is the most effective advertising agency network;
• Ogilvy & Mather (Mumbai) is the most effective individual agency office;
• McKinney (Durham, North Carolina, USA) is the most effective independently held advertising agency.

Yes, I was wondering about that last one, too. It recently appeared in ‘The Pitch’, AMC’s unscripted programme in which two agencies vie over 7 days for  a piece of business, in this case Subway restaurants. McKinney won. It’s notable for its Audi A3 campaign, Art of the H3ist, which garnered two Effies and a Cannes Lion. And also for something called “connection planning”, which I take to mean an integrationist skill that ensures campaigns work smoothly across all channels.

Good for McKinney, I say. But I do have a qualification. Last year’s winner in this category was the slightly more universally recognised Wieden & Kennedy of Portland, Oregon. Now, I’m all for merit making its way to the forefront without having to await Buggin’s Turn. But I also look for consistency in results. The Effie Effectiveness Index, which is sponsored by insight portal WARC and compiled from 39 individual national Effie competitions, was only inaugurated last year and therefore lacks granular historical perspective. That said, there is a repeat winner this year: McDonald’s, with the most effective brand accolade. Here, for quick reference, is last year’s roll of honour:

• Procter & Gamble was the most effective advertiser;
• McDonald’s was the most effective brand;
• Omnicom was the most effective advertising holding company;
• BBDO Worldwide was the most effective agency network;
• Sancho BBDO (Bogota, Colombia) was the most effective agency office;
• Wieden & Kennedy (Portland, Oregon, USA) was the most effective independent advertising agency.

I don’t suppose that Sir Martin Sorrell will be worrying too much about historical perspective, as he wipes the blood away from his nose. One way or another, WPP has collared most of this year’s top Effies. So, he is worth it, after all.

Ogilvy wins $300m global Coke Zero account…

…Something that has come as a bit of a shock to VCCP, which handles the £35m business in Europe, McCann Erickson – responsible for South-Asia, and Crispin Porter + Bogusky – the same, in the USA – who didn’t even know they were in a competition.

Why has Coca-Cola been so reluctant to disclose the fact that there has been a pitch at all, let alone that Ogilvy & Mather has won it? It’s a mystery. Although on the existing roster, Ogilvy has thus far been in charge of Latin America only. It’s not the most promising piece of Zero terrain (Latin Americans’ aversion to the ‘toxic’ aspartame infusing the brew is well known). Then again, maybe Ogilvy just had to fight that much harder to come up with a winning idea.

Two years ago, Coke instituted, at considerable expense, a European review which ended with VCCP triumphing over Wieden & Kennedy and Argentinian agency Santo. It was part of a global consolidation of agencies aimed at delivering stringent “marketing efficiencies”. At the time, coke CEO Muhtar Kent noted: “Agency numbers have gone down by more than half, and I think we have driven a lot of efficiencies in our market research costs, in our marketing over the past 12 months.”

Evidently not quite enough of them, judging from Coke’s recent conduct. The current “secret” review appears to be aimed at developing a single, global, advertising concept. I have not idea at this stage what that might be. Apply to Ogilvy Paris, which will be handling the global campaign.

Huge thought the win is, Ogilvy should remember that today’s favourite may be tomorrow’s casualty. In its agency relationships, Coke is beginning to resemble a gangster playing Russian roulette. Who will be the last agency standing?

There’s more on the nature of the win, and the turbid roster politics of Coke Zero, in an article by Joe Fernandez on Pitch.

UPDATE 16/12/10: Coke, under pressure, is now claiming “This [the Ogilvy] appointment does not affect local market agency relationships on Coke Zero.” Not much it doesn’t. Most of the money will now be flowing to Ogilvy. Still, you’ve got to keep the rest of the troops happy.

Polman gambles on sustainability paying off

Paul Polman, chief executive of Unilever, is either a very wise or foolish man. At this stage it is difficult to tell which. All we can say is that he has embarked on a courageous and momentous enterprise.

Ogilvy & Mather, which recently won Unilever’s multi-million pound corporate development account from Fallon, will shortly unveil details of the company’s 10 year sustainability strategy – Polman’s brainchild – to a largely unsuspecting public.

We’ve heard a lot about companies commitment to the mantras of corporate social responsibility – the Triple Bottom Line (3BL) of People, Planet and Profit. But frankly not much action, since Marks & Spencer’s milestone Plan A initiative in 2007. Polman’s plan is a lot more ambitious than M&S’s – and a lot more risky in the open-handed commitments it makes to supporting causes that may boomerang on core corporate objectives of profit and brand share, if mishandled.

To give the flavour of the plan’s ambition, it commits Unilever to source 100% of its agricultural-sourced products sustainably; to halve the environmental footprint of all its products – not just at the manufacturing stage, but from suppliers through to consumers; and to tangibly benefit the health of 1 billion people. All this in ten years. Even Polman admits he does not know how it’s going to be accomplished – yet.

The measure of the risk is this. Unilever is a major public company dependent upon the goodwill of institutional investors and their financial advisers. These people deal in quarterly earnings assessments, not ten-year plans based upon ‘idealistic’ notions. There’s still very little appetite in the City for the “Planet” element of the 3BL. So far, so good for Polman’s reputation: he has delivered 6-quarters of uninterrupted earnings growth. For now, they’ll humour him. But what happens if, at some future date, ‘Planet’ gets in the way of ‘Profit’?

Similarly marketing and brands. Polman has taken the visionary step of placing marketing, communications and Unilever’s sustainainability policy in the hands of its chief marketing officer, who for the first time is a board-level executive. That certainly advances the cause of joined-up strategy at the highest level. But it may give Keith Weed, the CMO in question, a few headaches when he comes to reconcile the consumerist ethic with a creed which is, in some respects, anti-consumerist.

There’s more in my Marketing Week column this week, not least some speculation on why Polman is prepared to take such an enormous gamble with his hitherto unblemished career.