Mondelez International has split its $2 billion global media agency assignment between Dentsu Aegis Network’s Carat and Publicis Groupe’s SMG, the snack food marketing giant said Friday. The new appointments are effective January 2016.
Both agencies are incumbents and competed in a shootout review that began in June for a potentially consolidated account. But the marketer has opted to retain both shops albeit with different assignments than they had prior to the pitch.
The biggest change: Carat came away with North America (which SMG had handled) while retaining Europe and Asia-Pacific. SMG has been assigned Eastern Europe, Middle East, Africa and Latin America.
In the U.S. last year Mondelez spent about $180 million on ads, according to Kantar Media. For the first six months of 2015, the firm spent nearly $112 million.
Mondelez also confirmed that Carat has been appointed its single communications agency for global categories, which includes communications planning.
The firm stated: “This decision is the result of a thorough assessment to evaluate capabilities in key areas of our growth strategy including e-commerce, programmatic buying and content monetization. Both agencies are terrific partners and we’re excited about this next step in our transformation journey.”
Last month Mondelez indicated it would be increasing its ad spending to 10% of revenue by 2018, up from 8% in 2014. The marketer also intends to grow its ecommerce business to $1 billion by 2020. It’s now about a $100 million business.
Mondelez added: “Centralizing our media operations with two core agencies offers us a significant opportunity to drive enterprise-level efficiencies that can be re-invested in our long-term growth. In fact, the new structure will drive cost savings of more than 10% that we can re-invest to fuel our growth. It also enables us to further simplify our agency infrastructure, leverage our scale and build our capabilities, especially in the areas of including e-commerce and content monetization.”
The firm had said earlier that it intends to cut some $3 billion in costs out of its budget by 2018.
Doug Ray, US CEO and global president, Carat, said: “We are delighted to be expanding our relationship with Mondelez, with whom we’ve enjoyed a strong partnership across Europe and APAC for the past several years. Their mission to be fearless innovators in the digital economy is inspiring, and clearly aligned with our ambition to redefine the role that media plays in driving their transformative growth.”