Two months after yanking its $300 million creative and media accounts from Ammirati Puris Lintas, Compaq Computer Corp. is moving $60 million in U.S. direct-marketing billings from Ammirati to Draft Worldwide.
While the shift is a blow to Ammirati--Compaq accounted for nearly half the revenues of the agency's direct unit--it keeps the business in the family; both Ammirati and Draft are owned by Interpublic Group of Cos.
Some 55 staffers of Ammirati's direct unit will follow Compaq's business over to Draft. The marketer and agencies have been negotiating the shift for several weeks.
CONFIDENCE IN TEAM
"We're moving an entire account and entire account team en masse," said W. David Vining, Compaq's director of advertising and direct marketing, North America. "It's a good testament to the confidence we have in those people."
Draft will be responsible for direct mail, DirectPlus print ads and TV spots selling Presario PCs directly to consumers.
Draft began buying direct response TV for Compaq in July, and currently does work for Compaq in Paris, Switzerland and Australia.
Although the new work is a U.S. assignment, Mr. Vining said it's possible Compaq will sign on with Draft in other overseas markets.
"Draft is a much more vibrant player [than Ammirati] in the direct marketing business," Mr. Vining said. "The opportunity is there" for Draft to expand its relationship in other countries.
The future of the direct account was thrown into doubt in early June, when DDB Needham Worldwide, New York, won the general advertising assignment. Mr. Vining, who then ran direct marketing and has since added responsibility for traditional advertising, at the time stressed to Ammirati Direct that Compaq was entirely pleased with its work.
But many Ammirati staffers were nervous, no doubt in part because of ill feelings between Ammirati and Compaq management following the split. DDB Needham executives, meanwhile, were believed to be wooing the direct business.
Mr. Vining said the shift to Draft first came up in a brainstorming meeting he had with Robert Solomon, president of direct and interactive marketing for Ammirati.
Why would Mr. Solomon pave the way for half his business to exit? "True to form, his client's needs come first," said Mr. Vining.
Mr. Solomon, who may follow the Compaq business to Draft, perhaps in a consulting role, couldn't be reached for comment by press time. But raising the idea of moving the business to Draft was also pragmatic: Mr. Vining said Compaq had quietly compiled a list of direct shops without account conflicts, including Draft.
"The list was fairly short," he said. "There aren't many agencies that would be able to handle this."
Compaq talked with DDB Needham's Beyond DDB, but decided it was too small.
Executives at Ammirati, Draft and Interpublic either declined comment on the shift or didn't return phone calls last week.
AMERITECH NOW LARGEST CLIENT
Ammirati's largest remaining direct client is Ameritech. Others include United Parcel Service, Ortho-McNeil Pharmaceutical Corp.'s women's health group, Lego Systems and Goldman Sachs & Co. The unit will have about 75 staffers after the Compaq team departs.
Mr. Vining said that while Compaq was happy with Ammirati's direct work, the relationship probably wouldn't have made sense long term.
Ammirati at some point "will go get a technology account on the general side. The second they do, they'll fire us," he said.
"This is just a much cleaner way to do it to protect our interests short term and long term," he added. "We keep the professionals, we get more resources, those people keep their jobs and we ensure synergy with the Needham work. It feels like a win-win-win all the way around."
Copyright August 1998, Crain Communications Inc.