New York, Oct. 28: The Bank of America, concluding an unusual review of its estimated $ 170-million advertising account, has awarded the bulk of the business to agencies owned by the Interpublic Group of Companies.
The decision, to be announced Monday, is a major victory for New York-based inter-public. The agency company has recently come under pressure from investors because of earnings shortfalls and operational problems at some of its agencies, particularly a sports marketing unit called Octagon. On Friday, Moody’s Investors Service downgraded Interpublic debt, saying the advertising company’s cash flow was not sufficient to pay for acquisitions and dividends and pay down debt. A loss in the review, and the subsequent departure of the Bank of America business inter-public already had, would have been another blow to the company.
The six-week review by Bank of America was a novel one in the advertising business. Rather than pit one agency against another, it asked Interpublic and the Omnicom Group, the parents of most of the agencies that already work for the company, to assemble teams of shops to compete for the business. The approach is indicative of how large marketers are seeking to co-ordinate the various elements of their campaigns to make them more effective and efficient, whether the selling is done through television commercials, direct mail, public relations or interactive marketing.
The hope is that the shared ownership under the holding-company umbrella will foster co-operation and consistency. “Talking with one voice, one message, one idea is incredibly challenging to orchestrate,” said Dan Roselli, who oversees brand and advertising assignments for the corporate marketing and communications department at Bank of America in Charlotte, N.C. “The only way to do that is by going to the holding-company model.” Among other advertisers that have consolidated most of their assignments at agencies owned by a single parent are Coca-Cola, DaimlerChrysler and Ford Motor.
“The inter-public agencies were selected over their Omnicom competitors because they clearly demonstrated they could work together as a team,” Roselli said in a telephone interview last week. “They showed both better creative strength and integration.” Bank of America executives handling the review were familiar with the financial problems disclosed by Interpublic, Roselli said, but that was not a factor in the deliberations. “We really focused on creative horsepower and what the holding company will bring to bear to build the Bank of America brand,” he added. “That’s what drove our decision.” Bank of America will work with inter-public agencies like Bozell in New York, Roselli said, which now creates ads for the company’s consumer banking division and ads aimed at affluent bank customers.