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Heineken consolidates media buying with Dentsu

Heineken consolidates media buying with Dentsu

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As Carat Nigeria gets renewal nod for 3 more years

Feelers emanating from the global media advertising landscape have revealed that Heineken, the second largest global Dutch brewer, has consolidated all its media buying and planning services to Dentsu with effect from January 1st 2021.

Consequently, Dentsu Red Star, who currently holds majority of Heineken global billings, will become the sole media agency, as Heineken evolves its media operating model.

The move, agency news sources revealed, “aims to maximize its global media investment to drive sustainable business growth. As a partner, Dentsu will be implementing a future media model allowing Heineken to access more specialist capabilities and talent to accelerate the growth of its brands. However, Publicis Groupe will retain media duties in its home country of France”.

Reacting to the news of the largest brewer’s media decision, Chief Executive Officer of Dentsu Media & Global clients, Peter Huijboom, said the global media giant was highly delighted for the global media account consolidation, adding that the decision was not unconnected with the fact that Dentsu had in the course of three years built a trusted partnership with Heineken which have been rooted in track record of performance and innovation.

His words: “We are delighted with Heineken’s decision to consolidate their global media services with Dentsu. Over the last 3 years, we have built a trusted partnership with Heineken, root in track record of delivery and innovation, particularly in the acceleration of Heineken’s individualized data driven marketing ambition. We are excited about building a future media model together across the entire Heineken portfolio.”

Consequent upon this global development and in line with the tradition of global re-alignment, Carat Nigeria has secured Heineken’s nod to continue ware-housing the media buying and planning of its business in Nigeria for another contract term tenure of three years.

Reliable industry sources hinted MARKETING EDGE authoritatively that the contract elongation letter to that effect was dispatched to Emeka Okeke-led media buying and planning group two weeks ago. While the Nigerian affiliate agency of the Dentsu global has kept excited sealed lips over their new win, agency source hinted MARKETING EDGE that it was jubilation galore when the news of contract elongation was broken to agency employees.

Although attempts to get the Chief Executive Officer of MediaFuse Aegis Dentsu in Nigeria, Mr Okeke, failed, MARKETING EDGE, nonetheless, learnt that the debonair media practitioner has been full of joy and excitement over the development, as not quite a few believed the Heineken business would be on toss in Nigeria this year.

The local agency affiliate was said to have resolved to be more committed, focused and consistent in shared-value and transformative agenda that is growth-focused on communication strategies for the Heineken team in Nigeria.

The Amsterdam based brewer’s decision conflicts with its earlier position in the past which only favoured market-by-market option.

In the past, the global brand’s operating model only allowed every OPco to choose the most relevant partner on a market by market basis.

Recall that Heineken’s last major global review was in 2012, when it consolidated its ad buying business with the network then known as Starcom Mediavest. (WPP’s Mindshare had previously handled the work in certain regions.)

In 2015, the brand also sent the creative portion of the business to Publicis without a review after splitting with Wieden+Kennedy and later named Neil Patrick Harris as its new brand ambassador.

Foreign news sources disclosed that the following year, another review managed by London’s AAR Partners saw Heineken add Dentsu to its agency roster in select markets, with Publicis continuing to manage the business in the U.S. and the U.K. The account was inherited by Spark Foundry and later transferred to Starcom Worldwide last year.

In April, Heineken reported an overall sales increase of 4.3 percent despite a weak European performance and a single-digit increase in its biggest market, Mexico. Investors remained unsatisfied, and the company’s stock price dropped when the announcement went live.

According to Kantar Media, Heineken spent $173 million on paid media in the U.S. in 2017, a slight increase from the previous year’s $164 million total. Global research company Comvergence estimates the brand’s annual marketing budget around the world at approximately $450 million.

A statement by the global CEO of Heineken, Dolf Van den Brink reads: “The first half of 2020 was defined by unprecedented challenges and I am very proud of our employees all around the world who are adapting quickly to new emerging realities while taking care of each other, our customers and our communities.

“The Heineken® brand once again demonstrated its strength with double digit growth in 14 markets and continued momentum of Heineken® 0.0.

“Our bottom-line was disproportionately impacted due to the decline in the European on-trade, as well as temporary government restrictions on our activities in Mexico and South Africa. We have taken mitigating actions and will further intensify our focus on costs.

“HEINEKEN has entered the crisis with a strong financial position, a diversified global footprint, great brands, superior consumer and customer intimacy and highly dedicated and talented teams. Moving forward and as markets recover, we will leverage these unique strengths to chart our next growth chapter.”

UPDATE ON ITS RESPONSE TO COVID-19

Since the beginning of the COVID-19 crisis, Heineken has been adhering to three guiding principles. First, the health, safety and trust of its people which it says, was of paramount importance. Second, it has done everything it can to safeguard the continuity of its business and protect the appeal of its brands. This includes supporting the business continuity of customers and suppliers. And, third, it offers its support to communities that are most impacted by the pandemic.

HEINEKEN is the world’s most international brewer. It is the leading developer and marketer of premium beer and cider brands. Led by the Heineken brand, the Group has a portfolio of more than 300 international, regional, local and specialty beers and ciders. It is said to be committed to innovation, long-term brand investment, disciplined sales execution and focused cost management. Through “Brewing a Better World”, sustainability is embedded in the business. HEINEKEN has a well-balanced geographic footprint with leadership positions in both developed and developing markets.

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