With AT&T Corp.'s firing of Ogilvy & Mather following that shop's gain of the worldwide IBM Corp. account, O&M finds itself on both the losing and winning ends of somewhat obscure conflict problems.
Ten years ago, Hallmark Cards decided Young & Rubicam's acceptance of an international long-distance phone account from AT&T formed a conflict. So after just two years at Y&R, Hallmark fired the agency and moved its greetings cards business to O&M. The conflict: long-distance phone advertising and greeting cards advertising are "motivational through sentimental and heartfelt emotions," explained a Hallmark executive. He said they both promote themselves as "the best way to share love and affection."
Telephones and greeting cards hadn't been considered competitive back then and, up until this month, telephones and computers hadn't seemed directly competitive either.
When it comes to account conflict, it's the advertiser's call; that's the only one that counts. However, marketers in some blossoming ad categories-telecommunications in this case-clearly could learn something about business practices from those in more established marketing categories. There should be niches in telecommunications, as there are in the food business, so a shop can handle both telephone and computer clients.
In O&M's account loss, even AT&T couldn't be too specific about the nature of the IBM conflict. The explanation was that "the trend toward consolidations, mergers and joint ventures has blurred the lines." An AT&T executive added: "IBM has had alliances with long-distance carriers in the past. Who's to say they won't again."
Well, who's to say they will?
And who will help agency executives figure out how to manage their business when conflicts of interest are so vaguely and capriciously drawn?