OMD scores lead role on Telstra media split

SYDNEY Telstra has split its mammoth media buying and planning business among three agencies, with OMD scoring a major win as lead agency on the A$80 million (US$58.6 million) account.

Marking the end of its seven-year relationship with Optimedia, the review also sees Australia's national telecommunications company appoint Naked Communications to handle media strategy for its youth and BigPond content sectors. Online shop White Agency also comes onboard, charged with online planning on the BigPond and Sensis brands.

According to sources, the tender also included Initiative, in addition to Optimedia. The review follows a significant revamp of Telstra's marketing operations under the guidance of CEO Sol Trujillo, who joined in 2005. In a bid to become more consumer-centric, the company has segmented and restructured its marketing and business development units. "It has recognised that it needs to be totally consumer-focused," said a source. "Historically, (Telstra) has been seen as a big business that takes so long to get things done that it is not necessarily the first port of call for opportunities."

For OMD Australia CEO James Greet, the win caps a resurgence at the agency, after it scooped Agency of the Year honours from both AdNews and B&T in the past year. Greet believes that Telstra is ready to meet the heightened competition in the various sectors in which it operates.

"The challenge is no different from any other company, where most communications from advertisers are unnecessary or irrelevant to consumers," explained Greet. "That is, how you best define the role of media and exploit it in a way that adds value to consumer experiences, rather than irritates and annoys."
In a statement, Telstra GM of media Georgie Nichols referred to the changing needs of the company's business in light of the "introduction of market-based management as a significant part of Telstra's transformation strategy and our new customer focus".

"Our decision on awarding the work is a reflection of how Telstra is implementing market segmentation throughout the company," said Nichols.

"We have selected three agencies not only for their areas of expertise, but also for how that expertise matches up with our segmentation strategy."