Chicago-based Leo Burnett Company – the last of the major agencies to spin off its media business into a branded, separate division – began the global rollout of Starcom Worldwide last month and expects the process to be completed this summer.
The Canadian unit of Starcom will be headed by Terry Sheehy, senior vice-president, media services for Toronto-based Leo Burnett, who says the new operation will be much more than just a branding exercise and separate profit centre.
For rather than operate as a standalone entity, Starcom Canada will be part of a North American operation and work closely with Chicago.
‘I had a few sleepless nights wondering how I could possibly support this [technology and research] on our own. That’s the terrific aspect to this,’ says Sheehy.
‘Canada has been sort of an orphan over time,’ he explains. ‘We’ve [Leo Burnett] had an Asia-Pacific region, a European region, a Latin American region, a U.S. region and a Canadian region – and Canada, by virtue of its size and scale was sort of orphaned amongst those other groups.
‘What was limiting about that was our ability to invest in proprietary research and systems and all those expensive requirements.
‘I’m not saying it’s the cost of entry, but it’s certainly becoming the priority consideration for advertisers looking for media suppliers.’
Sheehy says access to Starcom’s systems and research has come at a good time for Leo Burnett in Toronto, particularly as it enters the media review process recently called by its client of 45 years, Kellogg Canada.
The review of the Canadian media buying and planning business, valued at more than $28 million, is part of Kellogg’s global review of key business processes.
Leo shares worldwide creative responsibility for Kellogg with J. Walter Thompson. And although Leo Burnett agencies handle Kellogg media buying in North America, planning and buying is not aligned on a global basis, and regional Kellogg offices in other parts of the world are free to choose their own media agencies.
The final decision will be effective for Kellogg’s planning of year 2000.
Sheehy says, to his knowledge, there aren’t many – if any – global media-only accounts, but the formation of global media agencies opens the door to that eventuality.
He says what Starcom offers Leo’s multinational creative clients like Kellogg, Coke, Procter & Gamble and McDonald’s, is the opportunity to have that same consistency of purpose and strategy with respect to their media planning and buying.
‘I think we’ve already moved to a stage where media is no longer a certain byproduct of the client-agency relationship.’
As part of Starcom North America, Starcom Canada will be supported by the Chicago office, but Sheehy contends the Toronto office will not be losing its independence.
‘One thing they [Starcom Chicago] do realize is that media practices in Canada are different then they are there. They are indigenous to our geography, so they respect they can’t control all the decisions. They have to endow me with some authority and responsibility.’
Annual media billings for Leo Burnett in Toronto are $155 million. Leo Burnett reports billings of US$6.61 billion across its global network of 211 operating units in 75 markets.
Starcom in the U.S. alone has won nearly US$2 billion in new business since launching in 1997.
