Topic: Advertising
Some passing thoughts on the latest Labatt Breweries agency machinations.
Marketing Daily broke the story that the brewer had awarded Grip Ltd the Bud and Bud Light accounts, and essentially fired its other four agencies late last week (and the Globe and Mail followed up –finally- yesterday with a piece saying, with a few nuances, the same thing). Meanwhile, it has bundled its “lesser” brands into one assignment and invited some, although apparently not all, of the incumbents and some other agencies to pitch for the business.
Out big time is Downtown Partners, the DDB Canada satellite shop that had handled the Bud brands for the past seven years and also Keith’s for much for that time. It apparently hasn’t been invited to the pitch, which is a huge blow as Labatt represented 35% to 40% of the 35-person agency’s business. There’s serious talk that the shop will close or be folded into DDB Toronto, which has people seeing parallels to the last time Labatt made similar –some would argue unfair- agency moves. Back in late 2001 it awarded most of its work to the start up superstar creative shop Grip –staffed by the cream of the creative departments of most of the then Labatt roster shops–, which kick started the death spiral of its then lead shop Ammirati Puris. (For a blast from the past you can read my obit for Ammirati from 2002 here.)
First, the comparisons to 2001 are exaggerated. After all Labatt hasn’t hypocritically denounced the entire ad agency business model this time as justification for its move (for another blast from the past, you can read my column from November '01 about that here). Although, that said it’s reported invitation –demand– that incumbent shops show up and give a 15 minute presentation as to how they still add value and thus why should be retained –apparently reduced to 10 minutes for some on the day of– demonstrates that respect and partnerships are still foreign to the vocabulary of beer execs when it comes to dealing with agency “suppliers.” (That too isn’t exactly new. As Gary Prouk put it to me in an e-mail the other day, and to others: “working for Labatt was like doing hard time in the slammer with an insatiable giant cellmate called Bubba.” If that sounds bitter, he has every right. Gary led an agency, Scali McCable Sloves, Toronto, that got sideswiped not once but twice by Labatt’s agency schizophrenia, the last time in 1994 when Labatt gave almost all of its work to the then tiny and virtually unknown Toronto branch office of New York’s Ammirati.)
It’s notable that what didn’t happen this time is the lead Labatt agency didn’t get sacked. In fact, the shift is a ringing endorsement of Grip, a shop that many predicted would implode within a few years if not months of its founding. It’s six years going on seven folks, and Grip is still hanging in there as lead shop on the Labatt flagship brand. This counts as significant stability in the beer ad game. Ammiratti got a whole eight years with Blue, and Scali half that (let’s not go into JWT, which held the Blue brand business for decades before the still legendary 1985 review –won by Scali- that some suggest was the start of beer marketing madness in this country).
What’s changed here is that Labatt has finally acknowledged the sad reality that, after nearly 40 years –and two decades of slow decline- , Blue is no longer its flagship brand. The brewed here CanAm versions of Bud are now its flagships. So the hotshots at Grip now have the most important job for Labatt again. And in a sense, Labatt has gone back to its past with this move. After all several of the original key creatives on the Bud Light Institute, including David Chiavegato and partner Rich Pryce-Jones, are still Grip partners.
Once again, although not as badly as in 2001 when it lost its president to Grip, Roche takes an unfair collateral hit by these changes. The agency’s work for Stella Artois has done gangbusters at global and domestic ad shows this year, and more importantly the brand share has grown steadily here. Yes, they’ve been invited to the pitch, but judging by his comment Geoff Roche doesn’t think they have much of a shot.
As for Downtown, it does all seem so unfair. It was –is- a very good shop that did a lot of great work for Labatt and other clients. And it was the client, after all, that opted to shelve the popular Bud Light Institute campaign in 2005 and directed the agency to ape the successful (though less fun and intelligent) Coors Light creative model. Canadian beer advertising, not just Bud’s, hasn’t really had a spark since.
But the agency also knew it was overly dependent on the whims of Labatt management. It knew it had to diversify its client base, but never quite managed the task. I remember sitting on the Ritz terrace in Cannes with Tony Altillia, probably in 2003, talking about how as clients were becoming more demanding and fickle a lot of very good agencies, including the one he was running, were only just an account loss or two away from oblivion. We’d got on the subject in a there-but-by-the grace-of-god conversation about Ammirati actually. In light of events this month, Tony’s somewhat surprising early retirement from the Downtown CEO’s job in September takes on a new hue. Not that I have any evidence he knew what was about to come down, but I’m sure as the consummate account guy he is Tony could tell which way the wind was blowing.
Two final related streams of thought.
I’ve done a lot of referring to “historical” events here in talking about current events. I realized as I was typing that I felt nostalgia for a time when the beer business, and beer marketing, mattered more in this country. I think no one would disagree that the stakes just aren’t as high in the beer game as they used to be. And certainly it doesn’t seem to be any where near as much fun. I’m guessing part of that, though not all of it, is due to the fact that big two brewers are now effectively controlled off shore. I guess the next question is when will Molson give up on Canadian as its English market flagship brand too.
The other thought is just how little buzz there is about this in the media. Marketing Daily played it big, but seven or eight years ago both national business papers would have been all over this story–probably first–with multiple days of coverage. The Globe took a couple of days to get on it, and the Financial Post to my knowledge hasn’t covered it yet (nor surprisingly has Strategy’s Media In Canada). That may say more about the daily business press’s resource issues, but it also may also say something about the decline in importance of marketing and advertising-and not just for beer-in the business mix.
Posted by sutter or mckenzie
at 8:45 AM EST
Updated: Tuesday, 27 November 2007 7:46 PM EST
