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Shock for WPP’s GroupM as Sainsbury’s stays put

I hope no-one from WPP’s GroupM is planning to break bread with boss Sir Martin Sorrell this weekend because it could prove a daunting experience.

group-m_0-280x186Sainsbury’s has decided to keep its £60m media account, one of the UK’s biggest, with long-time Omnicom-owned incumbent PHD – despite competition from two WPP GroupM agencies, MediaCom and Maxus. All the WPP agencies use GroupM numbers in such pitches and GroupM, as far and away the biggest UK media buyer, should be able to offer the best rates. Not in this case it seems.

This is the third such major smack in the mouth for GroupM over the past few months. First it lost the UK government’s £140m media account, handled through bespoke outfit M4C, to Carat. WPP didn’t take kindly to this at all, instigating a court case against HMG which it subsequently dropped.

Then Johnny Hornby’s media agency m/SIX (which also uses GroupM prices) lost the £46m Dixons Carphone account to Walker Media, now majority owned by Publicis Groupe. Another big ouch which GroupM didn’t take kindly to either, openly wondering about how Walker managed to go in so cheap.

So that’s £180m or so down the tubes. Now GroupM has learned that Sainsbury’s isn’t coming its way when the cards appeared stacked in its favour during the marathon three-month review.

Omnicom is currently embroiled in an expensive (for its clients) stand-off with Channel 5, which should helped GroupM, which isn’t.

There’s some stormy weather heading GroupM’s way unless it can persuade WPP its opponents were offering unaffordable deals.

Update 2/3/15

WPP reminds me that its legal case against HMG hasn’t been dropped but is ‘ongoing.’

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.
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