3M CALLS ON AGENCY.COM TO EXPAND WEB PLAN

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Since launching its first Web site four years ago, 3M has done little more than provide company information and sell Post-It notes online. Now it's diving headlong into the Internet.

3M's goal is to sell a variety of products directly to consumers and businesses via the Web without disrupting its relationships with distributors and retailers. And it has named Agency.com, New York, to help guide the initiative as its first interactive agency of record.

Agency.com will work with 3M corporate marketing to develop a strategy of online brand-building and e-commerce development. The account will be handled out of Agency.com's Dallas and New York offices.

Grey Advertising, New York, is 3M's corporate ad agency.

INT'L PRESENCE

3M said it chose Agency.com over five other finalists in a six-month review because of its international presence, strong client base-which includes British Airways and Texaco-and its seeming ability to work well with 3M's employees and culture. 3M didn't disclose other agencies in the review.

"We didn't want someone to come in and tell us what to do, but listen to us and understand the direction we wanted to go," said Joan Gustafson, 3M manager of e-business.

The company wants to begin selling a variety of products through its Web site (www.3m.com).

3M's initial investment is relatively small-the company has earmarked $2 million to $5 million for the work-but is expected to grow over time. More significant than dollars, however, could be the value of Agency.com in helping 3M recast itself.

ORGANIZED BY PRODUCT

3M is "organized as a corporation by product," Ms. Gustafson said, but it has been developing an online business model that groups products according to customer base.

Agency.com will further develop this new concept of so-called customer centers through which 3M will sell products such as healthcare items and office supplies.

But 3M acknowledges the risk it runs in selling online.

"We have to be really careful about it at this time because we don't want to say [to retailers] that we are going to go out on the Web and compete against them-

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