Microsoft's global agency of record, Interpublic Group of Cos.' McCann Erickson, and WPP Group's JWT were cut, according to executives familiar with the situation. A final decision is expected in mid-February.
Agency executives either couldn't be reached or referred calls to Microsoft.
Hype consumer products
The Redmond, Wash.-based software giant since November has been on the hunt for an agency to handle a new campaign to hype its consumer products. The software giant is facing increased competition from marquee brands such as Apple and Google.
The pitch, pushed by senior Microsoft execs -- including Mich Mathews, senior VP-central marketing group -- will likely aim to persuade consumers to choose its products over cooler alternatives offered by its rivals, on the basis of reliability, according to agency insiders.
Despite its huge marketing spend -- Microsoft spent more than $900 million on marketing last year -- its products are perceived poorly in the marketplace, according to Rob Enderle, principal analyst, Enderle Group.
"Right now, their marketing sucks," he said, adding the problem does not rest solely on the shoulders of its ad agency. "They've got a serious problem. And I'm not absolutely convinced an agency can fix this."
Sticking with UM
Regardless of whether Crispin or Fallon is chosen, Universal McCann, meanwhile, is expected to handle media-buying and –planning duties.
"We are continuing with the process and no final decisions have been made," a Microsoft spokesman said. He said a decision was expected in mid-February. He said Universal McCann will continue to be Microsoft's buying agency, regardless of the decision on the creative account, and McCann Erickson will continue as Microsoft's agency of record.
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Contributing: Jeremy Mullman