A behemoth of beauty advertising in Canada has decided to shift the management of millions of dollars' worth of ad spending to another agency, ending a long-standing relationship with its media planning partner.
Montreal-based L'Oréal Canada informed ZenithOptimedia that it was ending a 15-year relationship with the agency, and would be handing over its media buying and planning duties to Toronto-based agency GroupM, starting in 2014.
It's a major account for the agency, encompassing 31 beauty brands including Maybelline NY, Kiehl's, Garnier, and La Roche-Posay. Collectively, its brands command roughly one-third the market share of beauty and cosmetics in Canada.
However, it does not represent a change in media strategy for the company, which will continue to concentrate its efforts on content marketing – where brands are integrated into videos, events and shows that viewers are already paying attention to, rather than simply serving up ads.
While most of its ad budget is still devoted to television, digital is the fastest-growing segment of L'Oréal Canada's marketing spend. The company's print advertising has been slightly in decline, which will likely continue, said Stéphane Bérubé, general manager of media investment, sponsorship and innovation at L'Oréal Canada.
"We need to think about video assets," he said. "You can say that YouTube is the No. 1 TV channel, depending on how you look at it. … TV is far from dead, and in fact has never been so strong.
But more and more people are watching programs on their iPads and laptops. We should call it video, no matter the size of the screen."
One of GroupM's mandates will be to continue developing multiplatform content, as ZenithOptimedia did. The Web series L'Oréal made last year in partnership with Rogers Media, Canada's Best Beauty Talent, is a good example. The reality TV-style contest among hair and makeup artists featured the company's brands prominently.
The company's sponsorship of the Toronto International Film Festival and its Maybelline-branded sponsorship of Toronto Fashion Week, where it has gone beyond simply attaching its name to an event, are two other examples. Both sponsorships have allowed L'Oréal to create behind-the-scenes videos and other content to draw consumers' attention. At TIFF this year, it will have its own reporters on the red carpet asking stars about their beauty secrets. More recently, its Garnier brand, which was in need of a refresh, sponsored a search for new MuchMusic VJs.
Regular agency reviews are a norm in the marketing world and L'Oréal's Canadian office had not conducted one in some time. ZenithOptimedia has managed advertising media buying for the company since 1998 and won its entire media planning and buying account in 2005.
"I personally worked on this business for 15 years, so it was a very tough thing to take. ...If you were to see their business results over the years, it's been very positive," said Julie Myers, president of Zenith Media at ZenithOptimedia. "...They're a tough client, but the challenges are purposeful. They want success, they drive themselves very hard, and we worked in pace with them."
Mr. Bérubé said the decision did not come from dissatisfaction with the agency's work. "We have been great partners," he said.
He noted that the committee of executives was drawn to GroupM's pitch partly because of its optimization software that helps determine the best places in digital and other media to spend its money, as well as its tools to measure campaign success across platforms – a priority for all marketers right now.
"As an industry, we went away a little bit too much from return on investment … " he said. "We will be able to share our data, and measure success."