Black Apple May Be Ripe For $150M Review

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A top Apple Computer marketing executive says if he were with an ad agency, he would be wondering if he had a shot at taking the PC marketer's $150 million-plus account away from BBDO Worldwide.

Michael Markman, Apple director of worldwide corporate advertising, said he's not reviewing the account now, "not in this season. Not at this time." But he added: "If I were a hotshot agency, I would start wondering whether I had a chance" to get the business.

BBDO is clearly under pressure. As part of a major restructuring implemented last week, the agency is recruiting "senior-level creatives" to "bring a new tonality to the advertising," said BBDO West Chairman Steve Hayden.

Those leaving BBDO include Kelly Black, Apple worldwide account director, now media director at CKS Partners, Cupertino, Calif., and Jim Ward, Los Angeles office general manager, who took a senior management post at Wieden & Kennedy, Portland, Ore., to work on Microsoft.

Also departing is Bruce Mowery, after just a year as the San Francisco office's general manager, to become VP-marketing at Music Net Interactive. Mr. Mowery was an Apple executive for nine years and ran the review 8

that led to BBDO's hiring in 1986; he was the last remaining member of the management group that picked the agency still involved in the Apple-BBDO relationship.

The agency is interviewing for creatives who Mr. Markman said will probably take the lead on Apple's U.S. ads. BBDO's longtime Apple creative duo, copywriter Chris Wall and art director Susan Westre, are focusing on Apple's European ads at BBDO in Paris.

Meanwhile, BBDO has eliminated 10 of 210 jobs in Los Angeles, lead office on Apple, and six of 45 in San Francisco. David Lubars, who joined the L.A. office as exec VP a year ago, becomes a clear No. 2 to Mr. Hayden as president and executive creative director of BBDO West.

A review would stun BBDO, which cited loyalty to Apple last spring in declining a private invitation from IBM Corp. to discuss its $500 million global account. Ogilvy & Mather Worldwide, New York, ended up with IBM and quit Microsoft Corp.

BBDO has Apple's "vote of confidence at the highest level," Mr. Hayden said. He said the agency-client relationship is "quite good."

Apple is a tough but lucrative account. Apple executives said the U.S. budget for the year starting this October will jump from $65 million to between $80 million and $100 million. Non-U.S. spending, handled mainly by BBDO, could approach that.

BBDO has produced what rival computer marketers agree is some of the best brand-building advertising in the industry. BBDO's Apple ads this year won a Gold Lion at the International Advertising Festival in Cannes and swept the computer category in the American Marketing Association's Effie awards.

"These guys do great work," Mr. Markman said.

Then what's the problem?

At the core is Apple. Saddled with a decision years ago not to license its acclaimed Macintosh software to other computer companies, Apple is an also-ran in a market where customers want PCs using Microsoft Windows software and Intel chips.

Apple beat out IBM for the No. 1 spot in U.S. PC sales last year with a 14.1% share, but it slipped to second in the first half of '94 with a 10.8% share, behind Compaq Computer Corp., according to Dataquest, San Jose, Calif.

No. 2 is still impressive, and Apple last month reported a rebound in profits and good sales of its new Power Macintosh line. But as rivals pick off business in Apple strongholds like desktop publishing, home and education, questions remain about Apple's long-term prospects.

Mr. Markman, an Apple veteran, said his preference is to maintain the BBDO relationship. One of his colleagues offered a strong endorsement of the agency. "We have a very good partnership, excellent creative, very solid account management, [and] stellar media buying and planning," said Linda Tsien, Apple USA manager of marketing services.

Yet Mr. Markman, who freely admitted he wants BBDO to feel the heat, said he's sticking with the agency in part because of the effort a review would take and the computer learning curve he feels an agency would face.

Mr. Markman knows how hungry agencies will view the changes.

"Anytime you see a shake-up, you start to say, `Aha, there's an opportunity,"' he said. Now it's up to BBDO to sell some computers.

Melanie Wells and Alice Z. Cuneo contributed to this story.

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