Coca-Cola has dumped Publicis Mojo from its agency roster, as it undergoes an extensive review of its relationships and fee arrangements with agencies.
Coca-Cola has admitted the downturn in the economy has prompted the beverage company to attempt to extract greater value from its agencies, with the review aiming to yield better efficiencies across the Australian and New Zealand markets.
One insider claimed Coca-Cola had issues with Mojo’s unwillingness to be flexible. “It was mainly an issue around [Mojo’s] work style,” the insider said.
The news comes the same week Mojo Melbourne lost a significant portion of its Cadbury Schweppes account to Saatchi & Saatchi.
Publicis Mojo chairman Graeme Wills played down the losses this week. He said the agency held only a small portion of the Coca-Cola account – Powerade and Mount Franklin – and most of the creative and strategic work was handled by the agency’s New Zealand office.
However, Mojo’s relationship with Coke has eroded gradually. Last year, Smart was appointed to handle the multimillion-dollar relaunch of energy drink Mother. Mojo had created the launch campaign for Mother in early 2007, but the product failed to gain traction in the $300 million-plus energy drink market.
Wills denied there will be job losses as a result of the account loss.
As the Coca-Cola review continues, more agencies could be cut. The roster currently includes Singleton Ogilvy & Mather, The White Agency, PHD Creative, The Marketing Zoo, Momentum Worldwide, Naked, brand consultancy Yello, digital agency Bullseye and Ikon Communications. Coca-Cola expects to complete its review next month and would not comment on its agency arrangements until then.
Smart is believed to be close to extending the terms of its contract with Coke, with financial arrangements being finalised. However, Smart chief executive Ben Lilley said he was contractually unable to comment on the account.
Nielsen AIS estimates Coca-Cola South Pacific spent $25 million on main media between December 2007 and November 2008, down $2.4 million year-on-year.
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