It's Official, And Anticlimactic: Wal-Mart Taps Draft, Carat

A week after news leaked that Wal-Mart had tapped Interpublic's Draft FCB and Aegis Group's Carat as its new ad agency team, the big retailer officially announced its decision on Monday. The result was somewhat anticlimactic, raising questions how Wal-Mart is going to manage its communications strategy going forward, if it cannot even coordinate its own PR.

Following last week's speculative reports, first reported by The Wall Street Journal and followed by virtually every advertising trade magazine and newspaper column, Wal-Mart's public relations department demurred comment until an announcement was made officially. That's standard operating procedure for big publicly traded companies like Wal-Mart. Despite that, a pre-announcement interview in which Wal-Mart Senior Vice president-Marketing Communications Julie Roehm commented on details of the review appeared in Monday's edition of Advertising Age magazine, replete with anecdotal details such as an aborted car ride she tried to take in Draft FCB chief Howard Draft's sports car.



As for the official announcement, details were actually quite sparse. Draft FCB was awarded the advertising and Carat was awarded the media accounts as part of an integrated advertising and marketing campaign to promote Wal-Mart as the "price leader," but explained little about how it arrived at its new Madison Avenue dream team, or why it dumped GSD&M after nearly 20 years. The announcement alluded to a shift toward using a more "targeted and refined voice," but did not elaborate other than Roehm's statement: "Recognizing that a one size fits all model is a thing of the past, we have strategically transformed marketing ranks to move from a predominately national approach to a store-by-store, customer-by-customer execution of marketing campaigns."

One thing's for sure, the account will be closely watched as a bellwether for retail marketers going forward, because Wal-Mart has been in the process of transforming its marketing team and its strategy, recruiting Roehm last year from DaimlerChrysler, and rethinking the rules of retail marketing. Other tells include Wal-Mart's announcement last week to participate in Arbitron's and VNU's Project Apollo test, which will provide information on how advertising and media impacts retail product purchases. Coupled with similar insights from Carat's MMA unit, the moves appear to indicate that big retailers are in need of new consumer insights, and may signal an end to their dominance of consumer marketing insights that emerged with the rise of UPC product scanner data in the 1970s and 1980s.

Beyond that, little is known about the plan other than the effect it is having on its agency roster. Interpublic's stock surged on last week's speculative reports and has remained near its 52-week high. Aegis group's inexplicably fell about 1%, even though the company is widely considered to be in play.

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