JWT Loses Juice as Pepsi Moves Slice to BBDO
The J. Walter Thompson ad agency, caught in a spiral of lost clients, has lost another big account.
This time it is Pepsi-Cola USA, which said on Tuesday that it is assigning its $32-million Slice soft-drink account to BBDO Inc., the New York ad firm that handles nearly all the rest of Pepsi-Cola advertising.
The move is an attempt by Pepsi to turn around declining sales of Slice, a soft drink that contains 10% real fruit juice. Slice accounts for nearly $1 billion of the $40-billion soft-drink industry, but its sales recently have been slipping, analysts say. Thompson has handled the account since 1984, when it introduced Slice with the slogan, “We’ve got the juice.”
Not any more it doesn’t. The loss of Slice follows a decision by Sears only last week to reassign to another agency its $35-million Discover Card account. The struggling ad firm has lost an estimated $490 million of its $3 billion in estimated annual billings since it was purchased by the huge British marketing firm WPP Group in July. Among those losses are Burger King, Goodyear, Chevron’s retail business, Hunt-Wesson and Ford’s international business.
One analyst suggested that the losses may give the agency an opportunity to trim the payroll. “It’s not a good trend, but sometimes when you lose accounts, it’s easier to get rid of people. That’s something Thompson still has to do,” said Victoria Butcher, an analyst at the New York securities firm Eberstadt Fleming. “They’re still pretty fat over there.”
Thompson executives would not comment Tuesday on layoffs or changes that will result from the recent account losses. “There’s nothing much to add to Pepsi’s announcement,” said Tom Robbins, a Thompson spokesman.
New advertising for Slice is scheduled to break in February, said Ken Ross, a Pepsi spokesman. “When we introduced Slice, it took off like a house on fire,” Ross said. He attributed the recent drop in sales to competing brand introductions and to “a natural evolution that all brands go through.”
