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Hair-care brand suing Ikon for ‘failed’ campaign believed it was going to be a ‘smash’, court told

The general manager of a hair product brand which is suing Ikon for a failed marketing campaign was in raptures about the creative of a TVC, predicting it was going to be a “smash”, a court has heard.

Emails from Advangen GM Emma Chen to Ikon executive creative director Rob Martin Murphy showed she was “completely on board and supportive of the creative approach”, Ikon counsel, Todd Alexis SC said.

The evidence emerged during the second day of a legal battle where Ikon is suing Advangen for unpaid invoices, while its former client is counter suing amid claims the agency was responsible for a sub-standard and ramshackle marketing campaign.

Among Advangen’s complaints surround TV ads produced by Ikon which it argues were too “arty” and completely missed the point of the hair thinning remedy product they were promoting. Sales as a result were dismal, Advangen has claimed.

On the second morning of a hearing at Sydney’s Supreme Court, Alexis again quizzed Maria Halasz, chief executive of Advangen parent Cellmid, about the campaign for Evolis.

Put to her that her general manager had backed Ikon’s creative approach – Chen predicted it would be a “smash creatively” – Halasz agreed.

Rob Martin Murphy oversaw the creative for the Advangen Evolis campaign

“I was happy with what Emma [Chen] was saying to me, but I had no expertise, I was leaving it to her,” Halasz told the court.

She agreed that by letting her GM take control, she had effectively given approval for the ad.

“But I had not seen it,” she added.

“You were content to leave the decisions to your GM?”

“I was,” Halasz confirmed.

Even after seeing the TV ads for the first time and going to air, Alexis suggested to Halasz that she did not object to the content or articulate her fears that it was to be shown in the wrong spots in the wrong TV programs and only on one free-to-air channel.

“No I didn’t,” she said.

Halasz told the court that she did not object on first viewing because it was shown in the Ikon offices where there was clapping and a celebratory atmosphere.

“I did not feel it was appropriate to mention it in that environment,” Halasz said. “I watched it subsequent times and I was very unhappy with it, but I didn’t feel qualified to say that.”

She added she was not an advertising expert and “didn’t even watch television”. She told the hearing she was comforted by Ikon “who thought it was going to work great”.

“I didn’t feel it was my place to object. At some point you have to trust the people you hire.”

Alexis rejected Halasz’s claims in her written evidence that she formed highly critical views of the ad when she first saw it, suggesting she only began criticising the TVC once Ikon began pursuing Advangen for unpaid bills and pressure mounted from disgruntled shareholders unhappy with the ads.

He said the only issue initially raised with Ikon creative Rob Martin Murphy appeared to concern the voice over on the commercial which Halasz regarded as too quiet.

Halasz rejected the assertions.

Maria Halasz

 

Turning to sales of the Evolis product after the campaign kicked off on August 30, Alexis painted a picture of confusion and contradictions at Advangen, with Halasz on one hand saying sales had fallen, but with GM Emma Chen telling Ikon’s then communications director Elyse Foley that sales were going well.

Alexis produced two emails from Foley telling Chen and Advangen sales director Evan Rees that it was “good to hear sales are going well”,

“That contradicts your evidence that sales has not increased,” he said.

Halasz stood by her evidence despite accepting that the emails contradicted her own statements.

Alexis also produced sales figures provided by Advangen national sales manager Mr Hatter which showed sales through API, a wholesaler providing Evolis products for pharmacy retailer Priceline, dipped slightly in September but climbed 51% in October.

Halasz said the figures proved that sales had dropped in September.

The court heard that shareholders who had seen the TV ads were unhappy, putting Halasz under pressure.

“You had some explaining to do,” Alexis said.

It also emerged during proceedings that Halasz had written off the campaign after less than three weeks and saw little point in continuing despite being urged by Ikon to give it time.

Alexis also noted that despite cancelling the TV ads in October, Advangen gave approval for Ikon to enter the ads into awards.

“So you were very unhappy with the ads and what it conveyed in relation to your product but you were entirely content to have the TV commercial entered into industry awards?” he asked.

Halasz said it had nothing to do with Advangen before accepting she had given her blessing.

The Cellmid boss claimed Ikon staff admitted, in October, that the campaign had been disappointing, an allegation rejected by Alexis who argued they had said nothing of the sort.

During four hours of questioning, the barrister also referred Halasz to an ASX announcement in late October in which she, in her position as CEO of Cellmid, told the market that following the commencement of a national advertising campaign “early indicators show that brand awareness and sales are increasing” of the Evolis product.

Such comments were at odds with her evidence that sales in late September, October and November had not improved, Alexis said.

“The two don’t sit happily together do they?”, he asked. “Either what you told the market is true and your evidence is false or what you said in evidence is true and what you told the market is false. Which is it?”

Halasz explained that by the end of October it saw a small increase of web sales “which is why I used the words early indicators because we saw there might be a sales uptick”.

“We didn’t see any sales increase throughout September and early October so my evidence was entirely correct,” she told the court.

Alexis also tackled Halasz on her allegations that Ikon had engaged in dishonest conduct over a billing error, describing them as “baseless”.

Earlier, the Ikon counsel drew attention to Advangen’s sales force which it had contracted through Farmaforce in September to work closely with pharmacies. He told the court the on-the-ground sales staff did not start in earnest until late October, several weeks after the Evolis marketing campaign started.

Halasz agreed there was a “disconnect” between the campaign start date and having the sales team in place.

The hearing continues.

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