TOKYO: Nestle has realigned its confectionery business in Japan
with J.Walter Thompson, dropping Dentsu and Hakuhodo, which handle the
US$5 million Crunch and $15 million KitKat business
respectively.
The Polo brand will remain with Hakuhodo Lintas, but the bulk of the
business will move to JWT on September 1. "We have simply decided to
follow international alignment policies for the brands," said a Nestle
spokesman.
For Dentsu, the shift is a double blow. Nestle was one of its most
prized international accounts for more than 30 years and was seen to
offer an avenue for for the network to expand outside Japan.
The agency risks losing other brands if Nestle decides to follow
international alignment policies in other categories.
Industry sources are speculating that multinational agencies stand to
gain if Nestle and other Western advertisers follow global alignment
policies.
In the past, international advertisers disregarded these directives in
Japan - especially when confronted with the media and creative strength
of a Japanese agency like Dentsu.
Dentsu is refusing to concede defeat and is reportedly working to
reverse Nestle's decision.
The loss of Nestle is the second blow suffered by Hakuhodo in recent
weeks, after the loss of the $20 million Mitsubishi account.
The Nestle gains are the latest in JWT Japan's remarkable $60
million winning streak this year.
New business wins this year are said to be equivalent to about 10 per
cent of the agency's full year billings. These include golfing equipment
brand Salomon & Taylor, fashion retailer Right-On and Prudential's PCA
Life.
According to JWT president Ambar Brahmachary, the wins reflect
investments the agency has made over the past 18 months in its creative
and planning resources.
