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SEOUL — LG Electronics' will continue working with LG-One, the WPP unit comprised of staffers from Hill+Knowlton Strategies and Ogilvy PR, following the fourth review of its global corporate communications requirements since 2009.
The mandate is an expanded one, covering 20 markets and believed to be worth as much as $8m in fees. But the decision will surprise few industry observers. LG-One first secured the business in 2009 and has retained it at every review since.
LG Electronics senior director of global communications Ken Hong, whose tenure with the company neatly coincides with the LG-One relationship, told us this morning that conflict concerns make it very difficult for other PR networks to dislodge the incumbent.
The mandate is an expanded one, covering 20 markets and believed to be worth as much as $8m in fees. But the decision will surprise few industry observers. LG-One first secured the business in 2009 and has retained it at every review since.
LG Electronics senior director of global communications Ken Hong, whose tenure with the company neatly coincides with the LG-One relationship, told us this morning that conflict concerns make it very difficult for other PR networks to dislodge the incumbent.
"It’s very hard to unseat them — they are WPP and they are strong wherever you go," he said. "There are very few companies in the world that have products as diverse as LG, so we’re finding it more challenging every time procurement calls for a review to find agencies that can handle this wide scope. Simply because there are so many players in this space and so many conflicts."
Hong noted that seven contenders were invited to pitch for the business this year but declined to confirm how many actually took part. The Holmes Report understands that at least two major groups — Omnicom and Interpublic — declined the opportunity, after previous attempts to win the business proved fruitless.
"We invited most of the major holding companies, but I’ve seen a lot of these companies running into conflict accounts very early on," said Hong. "We are maybe going to have rethink our strategy going forward if we’re going to keep asking agencies to come in."
Major markets covered by the expanded relationship include the US, UK, Germany, China, Korea, France, Brazil, Thailand and the UAE. While the focus is corporate communications, local market activity often includes product work. The overall goal, said Hong, is to give LG more of a lifestyle positioning, in common with many of its electronics rivals.
"The industry is changing to the point where we don’t have as many new products launching every year," said Hong. "The hardware itself is not going to create the love of the brand."
Hong noted that seven contenders were invited to pitch for the business this year but declined to confirm how many actually took part. The Holmes Report understands that at least two major groups — Omnicom and Interpublic — declined the opportunity, after previous attempts to win the business proved fruitless.
"We invited most of the major holding companies, but I’ve seen a lot of these companies running into conflict accounts very early on," said Hong. "We are maybe going to have rethink our strategy going forward if we’re going to keep asking agencies to come in."
Major markets covered by the expanded relationship include the US, UK, Germany, China, Korea, France, Brazil, Thailand and the UAE. While the focus is corporate communications, local market activity often includes product work. The overall goal, said Hong, is to give LG more of a lifestyle positioning, in common with many of its electronics rivals.
"The industry is changing to the point where we don’t have as many new products launching every year," said Hong. "The hardware itself is not going to create the love of the brand."
