Loyal readers will know that the UK government has switched its media buying account from WPP’s bespoke agency M4C (left) to Aegis Dentsu. The business is estimated at £140m although the Government spends far more than this on communications (about £400m).
We wrote earlier that the Government, via the Cabinet Office, claimed the switch of agencies would save it £100m. The actual wording of the Government statement was “contribute to delivering savings of over £100m.” So the same but different, if you see what we mean.
WPP sources say this reflects a difference in this tender and what was required in the last one; possibly meaning less media.
OK, saving £100m out of a £400m budget, let alone £140m, is clearly impossible if you’re buying the same stuff – even for Dentsu Aegis’s negotiating rottweilers.
The Government has now formally awarded the business to Aegis after the High Court found in its favour following a legal intervention by WPP.
This is what WPP says: “We are disappointed by the decision of the High Court to allow the Cabinet Office to award the Government’s media buying contract to Carat, despite the continuing legal action in connection with the Invitation To Tender (ITT) process, which resulted in this award.
“Despite having been denied access to date to the full details of the calculations and evaluation, we maintain that there have been several errors in the ITT process and we strongly believe that the award does not deliver the best deal for UK tax payers.
“As the litigation will continue, notwithstanding this decision, it would be inappropriate to comment further.”
So it doesn’t look like WPP is going away, even though the odds seem stacked against it.
There wil be more despatches in due course, no doubt.