New Business Continues To Wane For Media Shops

In another indication that the pace of new media agency business may be waning, media account turnover continued to ebb through the first quarter of 2004, according to estimates released Thursday by Media Analysis Plus.

Media account turnover totaled $394 million in March, down from the $572 million in media billings that changed hands in February, according to the March edition of the MAP Barometer, which tracks media account changes of $10 million and higher.

Year to date, the volume of media account turnover is $1.4 billion. In January-March of 2003, the total was $1.3 billion and in January-March of 2002 it was $2.8 billion.

"It does seem to be decelerating," said Jim Surmanek, CEO of MAP. Part of the slowdown, he said, was the fact that there are fewer media consolidations taking place, because many of the biggest marketers have already consolidated their business. Another big factor could be the recent trend of marketers sticking with their incumbent agencies even after initiating so-called mandated media reviews.

advertisement

advertisement

"We saw that with Amex," said Surmanek, referring to American Express' decision to stick with MindShare after a long and exhaustive review of its media services account. Another recent high-profile media review - America Online's - ended with the incumbent, Initiative Media, retaining the business.

"I think that what's going on is more due diligence, but fewer account turnovers," said Surmanek.

Ten advertisers shifted their media assignments in March compared with seven in February. In 2003, the average number of media assignments with billings of $10 million or more that changed hands on a monthly basis was 11.25.

The biggest single media-buying account shift in March was Red Lobster, whose $100 million account went from Euro RSCG Tatham Partners to The Richards Group.

March 2004 Media Account Turnover


Account Loser Winner Billings
Banquet (Conagra) Fogerty Klein Monroe DDB $20 mil
California Lottery MediaCom BBDO West $25 mil
Chuck E. Cheese Initiative Starlink $25 mil
Ferrero USA Universal McCann Zenith $20 mil
General Nutrition Various Cramer-Krasselt $20 mil
Levi Strauss OMD Initiative $60 mil
Nokia Richards Group MediaCom $60 mil
Red Lobster Euro RSCG Tatham Richards Group $100 mil
Tyson Foods DDB Arnold $40 mil
Winn-Dixie Cramer-Krasselt VML $24 mil

Total March 2004 $394 mil
Total Q1 2004 $1,356 mil

Source: Media Analysis Plus.
Next story loading loading..