How Brett and Lee won the Olympics for McCann

A lot of people must be asking, how on earth did ill-favoured  McCann Erickson manage to beat the mighty WPP to Locog's prestigious 2012 Olympics advertising account? Not least among them, Sir Martin Sorrell, WPP's nettled chief executive.

The short answer is: Brett Gosper, McCann Worldgroup EMEA president and his secret weapon, Lee Daley.

It can be no coincidence that, weeks after McCann Worldgroup appointed the somewhat tarnished, but nevertheless clever, former Saatchi & Saatchi chief executive to the newly created role of EMEA chief strategist (reporting directly to Gosper), McCann walks away with the Olympics prize.

Another non-coincidence is Gosper's familiarity with the workings of Olympics committees. He happens to be the son of Richard Kevan Gosper. Ring a bell? Then I'll refresh your memory. Gosper senior is a former Australian athlete of some renown, and more to the point, a former IOC vice-president of 20 years standing at the venerable body which holds supreme sway over the Olympic Games.

Just for the record, Kevan – as he prefers to be called  – won an Olympics silver medal for the men's 400m relay in 1956, and managed to take in being Shell chief executive and chairman Down Under during his long and successful career. So he's not lacking influential political connections. He's practically a national hero. What you might call Gosper junior's inside track, in fact.

One other non-coincidence is Daley's own brief and colourful connection with high octane sport. Remember his four-month stint at Manchester United? He'd probably rather you didn't. But by the law of unintended consequences, it has served him well in the end.

Sorrell pipped at the post in Olympics pitch

Much consternation in Farm Street, Mayfair, as McCann-Erickson, backed by IPG, wrests the Locog advertising account from its 'rightful' owner, WPP.

From the beginning of the pitch, WPP had looked a shoo-in. It was one of a remarkably small circle of contenders that had the power and scale to handle what in effect is a piece of global business. True, the much smaller Chime beat it in the duel for the initial 1-year marketing communications package. But that was a blip. Chime (even if it is part-owned by WPP) simply didn't have the resources to win part 2   – the much bigger bit of business spanning 3 years to the Games themselves.  And it showed when it was one of two to be dropped from the frame last week, leaving McCann and WPP.

At the time, no one much rated McCann's chances of success. WPP, now the world's largest marketing services network, is a much stronger organisation than Interpublic – which has been severely weakened over the past few years. In addition, WPP's boss, Sir Martin Sorrell had invested a lot of personal energy in winning the account. The fact that he was personally present in Singapore when the British team, featuring David Magliano and Sir Keith Mills, won the bid to hold the Olympics in London gives the flavour. For WPP, it would have been a way of juxtaposing one very British success story with another – its own.

Why did it lose? The devil is in the detail. Locog's is no ordinary ad account. Though worth a notional £10m over 3 years, this £10m is in fact a benchmark figure for which competing agencies had to tender (as did other services, such as the Locog accountants, Deloitte, and the Locog solicitors, Freshfields). Agencies were invited to provide ad valorem services – such a media buying, content, creative ads, sponsorship. If Locog spent over £10m, the winning agency would be quids in, because it would be conventionally rewarded. If, on the other hand, Locog underspent, the winning agency would have to underwrite the difference, and that would mean coming up with cash. 

It can readily be seen this is an expensive but finely judged gamble, and one which will be heavily disruptive of a marketing services network's normal commercial activities. Though there is glory in winning the business – and a tier 3 sponsorship thrown in – the account could easily turn into a poison chalice. Sorrell was prepared to take that chance, but was incensed that Locog had spun off the more profitable research part of the business (worth another '£10m') as a separate account (for which, by the way, WPP is not competing).

Failure to strike a deal over this vexed issue was the main reason that WPP lost out in the final pitch. It may come not to regret that mistake in the next few years.

No crock of gold at end of Red Brick's rainbow

When was the last time you heard anything about Frank Lowe-inspired Red Brick Road - you know, the Tesco agency? I thought so: when it lost its only other account of note, the global Heineken business, to BBH a few months back.

Red Brick Road's inability to win new business after such a spectacular start back in 2006 means it is badly in need of an exit strategy. Which may well account for the following rumour. There's going to be a merger with WPP's JWT some time in the summer. The only real casualty will be JWT's B&Q account. There, that's it.

It's quite an attractive rumour in its way. JWT, which has experienced a "recovery of sorts" following managing director Alison Burns' departure is still weak on top management, the problem being the idiosyncratic personality of JWT Europe executive chairman Toby Hoare. Who better to up the ante than one of London's best managers? Yes, step forward Red Brick Road ceo Paul Hammersley. Add to that the prize of Tesco, which JWT narrowly failed to lure a few years back when it was looking promiscuous at Lowe, and the idea seems juicier still.

There's only one problem. The rumour isn't true. What is true is that 20% stakeholder Sir Frank would like to get out and that he has held intermittent talks with WPP's Sir Martin Sorrell. These talks have considered several scenarios. One was to poach the Tesco media account from Initiative and place it in a WPP-sponsored outlet, probably MindShare. That at least was the WPP angle. Sir Frank had other ideas, such as a joint media venture with WPP in which Red Brick Road would hold a 50% stake. No dice with Sir Martin, it seems. And when finally  the Initiative account did come up for review last year, well it just stayed put. There have also been whispers of  'doing something' with Johnny Hornby's CHI, already part-owned by WPP, but this one was stillborn on the drawing board.

WPP now seems to have given up on any kind of a deal. But that doesn't meant Red Brick Road's strategic problem has gone away. Nor has it prevented the agency's executives from spinning imaginative fantasies about solving it.

WPP flicks V-sign at BBH

Oh frabjous day, calloo, callay, he chortled in his joy. As well the knight of Farm Street might when he received news that WPP had wrested back Vodafone's strategic creative account, which had embarrassingly eluded his clutches for the past 3 years.

The account is "strategic" in several respects. First, it is worth a great deal of money – £50m a year in the UK alone. It also gives WPP control of the commanding heights of the Vodafone marketing services business: mastery of the Big Idea, from which all else in due course flows. Finally, it provides further eloquent testimony, in the wake of HSBC and Dell, that an integrated agency specifically built around a client's global needs, and known as the WPP Team model, actually works. (No one mention Samsung in this context, by the way.)

Most piquant of all, however, will be the knowledge that Sir Martin has managed to deliver a body blow to the nether regions of rival agency group BBH. BBH comes from a different place on the agency spectrum to conglomerate WPP. It's a creative micro-network, with limited international distribution. The idea being that it can seed a great creative concept capable of playing globally even though others may be left to distribute, and adapt it, to local markets. BBH, long one of the UK's most accomplished creative agencies, has had considerable success with the micro-network mantra. Which helped it, for example, to win British Airways.

Worryingly, it had begun to peck at WPP's entrails by winning the really big accounts from which, in the pre-digital age, it would have been precluded by its smaller scale. The loss of substantial Unilever business was a particular sore point.

And then, of course, there was Vodafone. In 2002 WPP looked as if it had got the Vodafone business all wrapped up when its leading brand agency, JWT, won the international account. Not for long. BBH was appointed to the telecoms giant's roster in 2004 without a pitch and from then on began to prise open JWT's grip on the account. To this day, BBH handles the UK strategic account, while JWT is left with the more boring product stuff.

So the act of seeing off BBH as well as McCann Erickson in a 3-way pitch for the global strategic business will have been balm indeed for WPP's nettled leader. We can only presume that the UK bit of the business retained by BBH will soon be on notice...if Sir Martin has anything to do with it.

The end of history for IPG

Interpublic's Q4 figures just out. Profits down 4.?% yawn, yawn, yawn. Here's an extract, if you'd like something with fewer harmful side-effects than Mogadon:

"The latter part of the fourth quarter and early part of 2009 have begun to show the negative effect that the broader economic situation is having on the marketing services sector," said Michael Roth, chairman and chief executive of Interpublic. 

But wait, what's this? "Our long-standing conservative approach to financial and balance sheet management has us well positioned for these volatile times." Would that be the self-same "conservative approach", Michael, that your company was forced to adopt after an accountancy scandal which gave a new meaning to "double entry" book-keeping? Which resulted in several senior people in the McCann Erickson network being fired? Oh, and which precipitated a six-year long investigation by the US Securities and Exchange Commission, poleaxing IPG's share-price all the while? And, and, and...culminated in a $12m fine last year?

As it happens, I think Roth has got quite a few corporate talents, in his dull, lawerly way. And keeping the basket-case that was IPG from ruin, or the depredations of Vincent Bolloré and Sir Martin Sorrell, have shown them to good effect over the decade. One quality I hadn't attributed to him, though, was irony. How unamerican of him.