News

Subway names new digital agency of record

February 7, 2012

MediaCom has been chosen to head up Subway Restaurants' domestic digital advertising duties, including search, mobile and display ads.

According to ClickZ.com, MediaCom has been handling Subway's offline spending since 2000. The digital assignment will combine the chain's overall message.

MediaCom replaces Publicis Modem, which previously held Subway's digital business. Modem's parent company, Publicis, restructured in the fall of 2011.

MediaCom is part of WPP's GroupM media agency group.

Kantar Media estimates Subway's 2011 digital media spend at approximately $12.7 million in 2011. However, this amount does not include mobile, which has become a big focus for the chain.

Subway's overall ad spend is about $358 million.

"We have decided to consolidate our digital media planning and buying at MediaCom for both integration and efficiency reasons," said Subway CMO Tony Pace in a press release. "We have confidence in MediaCom's management and believe they will help build upon our success in the digital space."

Ohio Subway operators sued for child labor violations

The U.S. Department of Labor has filed a civil lawsuit against the operators of five Subway restaurants in Trumbull County, Ohio, alleging federal child labor law violations, as well as violations of minimum wage and overtime provisions.

According to WKBN, the suit claims that Hray Enterprises, owned by Tammy and Joseph Hray, failed to pay workers for hours committed after restaurants closed, resulting in minimum wage and overtime violations.

Also, deductions made from some of the employees' wages for cash register shortages caused their pay scale to fall below the required $7.25 per hour minimum wage.

Additionally, the operators could incur penalties for allowing minors to perform hazardous tasks – such as loading and operating two paper balers and one trash compactor on a regular basis – which is prohibited by child labor regulations.

The franchisees were investigated from July 21, 2009, through July 12, 2011.

The restaurants under investigation are located in Warren, Cortland and Brookfield, Ohio.

Read more about marketing or operations management.