Independent agency Firefly has been left reeling by LG Electronics' sudden decision to shift its UK PR business to its globally aligned agency partner, LG-One.
LG-One, a multi-agency team of WPP shops, takes charge of the £1m business from next week, after winning the global mandate last year (PRWeek, 13 May 2009).
LG Electronics made its UK decision in late 2009, just days after sanctioning the hire of an account director to lead the business at Firefly.
'We hired someone on the approval of LG to work exclusively on its account,' said Firefly managing director Mark Mellor. 'We knew a global contract existed with WPP. But we had held planning meetings for 2010 and had been planning budgets.
'Given the day-to-day sentiment, we were surprised.'
The Firefly account director, who Mellor refused to name, has since moved on to another agency.
An associate director and account manager shifted to LG-One agency Hill & Knowlton as TUPE transfers.
H&K could not confirm whether the duo remained at the agency.
LG Electronics head of brand marketing Paul Meadows defended the company's decision. 'Business carries on as usual until such point as somebody terminates the contract, should you choose to do that,' he said. 'Our decision was taken at a macro level, not a micro level.'
After losing its biggest account, Firefly is also making five back-office roles redundant.
'You have to remain philosophical about the fact that global deals exist,' said Mellor. 'From May 2009 to November, we were repeatedly reassured that this affected global and regional, and not local, PR.'
Separately, it is believed that LG Electronics UK marketing director Andrew Warner is leaving the company.
What is LG-One?
LG-One is a multi-agency WPP team, largely made up of Hill & Knowlton and Ogilvy PR staffers. It is led by Claire Holden in the UK.
LG Electronics selected LG-One to handle its PR across eight global regions to ensure 'comms consistency'.
The value of LG's global PR business is £1.5m, a figure that rises dramatically once first-tier local markets, such as the UK, are included.