Home / Ad Tech / Embattled Starcom pulls out of $1bn GSK media review

Embattled Starcom pulls out of $1bn GSK media review

The spate of global media reviews is an unfolding nightmare for Publcis Groupe’s media agencies, especially its main US player Starcom Mediavest.

478x268xgsk_0.jpg.pagespeed.ic.I7vVR0o_9HWith between $20-30bn of global media up for review Starcom is defending all or a slice of many of them. The latest global giant to join the queue is the new consumer healthcare division formed earlier this year by the UK’s GSK and Swiss giant Novartis. But Starcom, which handled Novartis, has chosen not to compete, leaving the fight to the two GSK media agencies, Omnicom’s PHD and WPP’s MediaCom.

Even a big media agency can only handle so many repitches and Starcom will need to prioritise what it defends. Accounts currently up for review (not all Starcom clients) include Coca-Cola, Unilever, Procter & Gamble, Johnson & Johnson and L’Oreal. No doubt there’ll be others.

Opinions differ on why everybody seems to be reviewing at once, itself not a particularly clever thing to do as the agencies in question are hardly likely to be able to deliver their best when they’re fighting on several fronts. WPP’s Sir Martin Sorrell puts it down to clients worrying about ‘measurement,’ particularly in digital where, it seems, half the ads are ignored or appear in the wrong place. Some might say this is a consequence of programmatic buying, a growing business for both WPP and Publicis Groupe.

Others would point to the outbreak of angst among clients in the US over so-called ‘media rebates,’ money being returned by media owners to media agencies (or media agency holding companies) but not finding its way back to the client. Former MediaCom boss Jon Mandel let this particular cat out of the bag in an address to the US ANA (Association of National Advertisers).

GSK/Novartis is, in effect, a new company in consumer healthcare so a review was probably inevitable regardless of such concerns. The bulk of its media business is in the US with PHD handling about $900m.

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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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