General Mills to Let Agencies Call the Shots

By STUART ELLIOTT

June 13, 2006 - TheNewYorkTimes

One of the nation's largest marketers, General Mills, is seeking to transform the way it works with its agencies — and vice versa — in a shift that underlines the changes that are remaking the advertising industry.

The changes show how marketers are confronting challenges like increased competition, the fragmentation of the mass market and the rise of new media.

The shifts are intended to "completely overhaul the way we work with our agencies," said Mark Addicks, chief marketing officer at General Mills.

They are part of "a really strong push for growth" in revenue and profit at the company, he added, and a desire "to be the growth leader" in the packaged-foods categories in which General Mills competes.

One change is meant to help General Mills adapt to the new-media landscape as it tries to reach consumers using nontraditional approaches like the Internet, e-mail marketing and branded entertainment.

"The old media are alive and well, but the new media are in a very steep growth curve," said Jeffrey Merrihue, chief executive at Accenture Marketing Sciences in London, a unit of Accenture.

"You need to plan to take advantage of the opportunities and prepare for a future when the new media are more and more important," Mr. Merrihue said.

General Mills will let its two principal agencies, Campbell Mithun and Saatchi & Saatchi, determine the media in which ads run and which agencies will create them, in a bottom-up approach. Previously, the approach was top-down as brand managers at General Mills coordinated those efforts, working not only with the principal agencies but also with agencies that produced online, retail and minority campaigns.

The goal is "to make sure a campaign, from the get-go, is media neutral, going to the best place for that brand," Mr. Addicks said. Media neutral means that ads run where they belong most, rather than in outlets predetermined by tradition or the size of a commission.

Campbell Mithun, part of the Interpublic Group of Companies, and Saatchi & Saatchi, part of the Publicis Groupe, will become what Mr. Addicks and Doug Moore, vice president for advertising and branding, are calling "brand navigators." That is, they gain the authority to decide how to produce all types of campaigns that are integrated across all forms of media outlets.

According to an annual survey by Nancy L. Salz Consulting in New York, only about a quarter of advertisers allow agencies to be the primary coordinators for accounts. Executives at General Mills said the agencies requested the shift.

Peter Hubbell, executive vice president and general manager for the General Mills account at Saatchi & Saatchi in New York, said he believed the rewards would outweigh the risks. "Trepidation comes into play only when we're given responsibility for an outcome but not authority," he said. "Call it what you want, holistic marketing, integrated communications; everyone is talking about the right way to do it," Mr. Hubbell said. "General Mills saying to us, 'You guys decide who you want at the table' — that's pretty powerful."
Mr. Hubbell's counterpart at Campbell Mithun in Minneapolis, Mike Nelson, said he liked to think of the new method as "upstream planning."

"This is a key difference from the past, when the client said, 'This is what we want to do; come back to us with something,' " said Mr. Nelson, who is executive vice president and worldwide account director at Campbell Mithun. "This involves us earlier and gives us the ability to steward teams and lead."