The UK's largest supermarket chain has finalised a new media contract with the Interpublic Group-owned agency, which has been Tesco's agency of record for 19 years. All of its media planning and buying duties for 2009 and beyond, across all divisions of the company, will continue to be handled by Initiative, led by UK chief executive Gary Birtles.
Tesco spent £74m on media in 2007, excluding direct marketing, online and door drops.
Carolyn Bradley, marketing director at Tesco, said Initiative has "consistently delivered" for the retail giant, adding that its "knowledge and commitment" make it best placed to help Tesco through its "current business and marketing challenges".
Speculation surrounding the future of the Tesco account has been mounting since Initiative lost the £76m Orange account in September. In the same month, Media Week broke the news that Initiative's former chief executive Jerry Hill, along with its president of EMEA, Dirk Wiedenmann, were both leaving the company as part of a global internal restructure.
Initiative is in the process of restructuring group operations, which includes relocating all UK staff into the London offices of Interpublic sibling Universal McCann.
Initiative has been Tesco's media agency in the UK since 1989, dating back to the now-defunct Western Media, acquired by Initiative in 2000. In that time, Initiative has led the media communications of all of Tesco's expansion activities, including the launch of Tesco.com, Tesco Personal Finance and Tesco Mobile, as well as the store's core business.
Three years ago, Tesco moved its advertising business out of Interpublic Group's Lowe into Sir Frank Lowe's start-up Red Brick Road.
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