Wal-Mart Drops DraftFCB
Wal-Mart Stores dropped DraftFCB from its $570 million account last week and reopened the review with plans to hire a new shop before February.
The abrupt dismissal came only three days after the surprise departure of Julie Roehm, senior vice president-communications.
Roehm’s handling of the advertising review is thought to have contributed to her dismissal (PROMO Xtra, Dec. 7, 2006).
Under its new review, Wal-Mart is likely to consider only the finalists in the high-profile review that awarded the business to DraftFCB and media shop Carat in October. Those finalists were incumbents GSD&M and Bernstein-Rein, which had shared the Wal-Mart business, Ogilvy & Mather and The Martin Agency.
Carat, which lost its hold when Wal-Mart reopened the review, has been invited to pitch again for the account, but DraftFCB won’t be allowed in the new review.
Wal-Mart reopened the review as “the result of new information we have obtained over the past few weeks,” said Wal-Mart spokesperson Dan Fogleman. “Because of the work done during the original selection process, this new review should move quickly.”
The first review started with more than 30 agencies. It is unclear whether Wal-Mart did enough homework on those shops during the first review to consider any of them this time around.
Wal-Mart won’t give a timeframe for replacing Roehm, but it’s likely to have a new marketing chief in place before its new agency begins work.
DraftFCB was scheduled to start work on Wal-Mart’s advertising in February. The agency has not hired any staff specifically for the account, spokesperson Wally Peterson said. The shop does not plan to do any layoffs.
“We were still in contractual negotiations,” Peterson said. “The process [of handling the work] was ramping up. We’re now looking at staffing levels, but we hadn’t done a ton of hiring.”
The loss comes as a heavy blow to DraftFCB just as the agency finalizes its own operating structure following the June merger of Draft and FCB. Its top execs—CEO Howard Draft, president-COO Laurence Boschetto and global chief creative officer Jonathan Harries—will have their work cut out for them rallying the nearly 2,900 staffers in its Chicago and New York offices.
DraftFCB’s management was already girding for a heavy dose of training to prepare its full staff for a new structure for its combined operations. The New York staff will move from separate Draft and FCB offices into a single office in May.
“It will help when we’re all in the same building,” Draft told PROMO last month. “We’ve got management on board; now we just need to push it down to the staff.”
DraftFCB (then Draft) ranked No. 17 in the 2006 PROMO 100 with estimated net revenues of $387.4 million for 2005, up an estimated 15% from 2003. The agency opened an office in Bentonville, AR last year.
