The bitter rivalry between DDB vs. Burnett. Publicis vs. Omnicom. Keith vs. Leo, for the billion dollar prize, brought to us by McDonald’s, with a cast of bleary-eyed creatives caught in between, has ended.
The winner, as we all know, is Omnicom and DDB, meaning for the first time in 35 years everything on the menu is going to be served up by one yet-to-be-created agency.
This wouldn’t be the first time DDB started an agency for a single client, having successfully launched Element 79 in 2001 for Quaker Oats.
The new entity, called “the agency of the future” by McDonald’s US CMO, Deborah Wahl, will have “data at the heart, which allows us to be customer-obsessed at a whole new level in everything that we do,” she said.
In order to service the fast-food giant, in a climate where it faces mind-numbingly large competition, Omnicom’s new venture will report to DDB North American CEO, the popular Wendy Clark, the former Coca-Cola president of sparking brands, who was wooed to DDB just last November.
Who’s in and who’s left out of the new agency.
Joining the new Chicago agency staff of a reported 200 are digital and experiential experts from Facebook, The Marketing Store, Google and The New York Times’ T-Brand Studio.
It’s also been reported that 2015 Ad Age “Multicultural Agency of the Year,” Omnicom’s Miami-based Alma, will be contained within the agency as well, bringing its technological, total market approach to multicultural targets.
Although the new agency will pull personnel from DDB and other Omnicom shops, sources have said that no one previously associated with the account at Burnett will be invited.
What is left unsaid is what the switch means for Chicago’s Burrell, longtime McDonald’s shop which traditionally and successfully targeted the urban Black market. Publicis holds a 49% interest in Burrell.
Unknown is whether or not Burrell participated in the pitch alongside Burnett. And the status of Chicago-based Walton Isaacson, which has produced McDonald’s 365-Black awards for the last two years on TV-One, has been left out of the conversation as well.
McDonald’s “Pay for Performance” contract clause
Aside from being McDonald’s single, stand-alone agency, what sets this win apart from the others, is Omnicom’s willingness to go along with McDonald’s “Pay for Performance” clause in the contract.
Though details have not been disclosed, the new agency will reportedly work at cost with all profits tied to unnamed performance goals. These points, combined with others, is what reportedly led WPP group to exit the review.
“If Omnicom can’t deliver the kind of communications that will grow brand equity, drive traffic into restaurants and increase sales, then McDonald’s has a sophisticated hedge that will save it money, said Marketing Week columnist, Mark Ritson.
“If Omnicom is successful, McDonald’s will have no problem paying a small proportion of its profits to its agency partner for its hard work.”
According to Kantar Media, McDonald’s spent approximately $820 million on U.S. measured media in 2015 and $195 million in the first quarter of 2016.
The biggest question here is, with a fee based on performance how long can the new agency keep McDonald’s happy before it starts looking across town yet again. As one cynical Agency Spy poster said,” It’s a flip flop account. Always has been. Always will be.”
Wendy Clark and her team are ready and raring to take on the challenge. They have 120 days — Omnicom’s new “agency of the future” opens in 2017. Where it will be located, like its name, is pending.
Former Chicago adman Colin Costello now living in LA, is a working screenwriter whose credits include the Emmy-nominated “Moochie Kalala Detective’s Club” and the 2016 family film, “Traveling Without Moving.” Contact him at email@example.com.