How Fallon bested rivals for United's global acc't

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As the 45-day review for the global consolidation of United Airlines' much-prized and scrutinized account unfolded, executives at Publicis Groupe's Fallon Worldwide, Minneapolis, vacillated between euphoria and fear.

With the estimated $60 million to $70 million domestic portion of United's account already theirs, they reasoned they could nab the whole thing-a quest since 1996 when the agency won the business but was deemed too U.S.-oriented for the global role. But those highs would be tempered by the nervous realization they could lose everything, too.

`vote of confIDence'

In the end, Fallon execs were right to be optimistic. On Jan. 22, they awakened to the news they had outdueled WPP Group's Y&R Advertising, New York, for the estimated $100 million-plus worldwide account. Four years before, Y&R had picked up the international business when United made the shocking decision to drop Leo Burnett USA, Chicago, after decades.

"We are so pleased that United has given us this vote of confidence," a still-beaming Eric Block, general manager of Fallon Minneapolis, told Advertising Age the day after the decision.

But a little over a year ago, a vote of confidence in Fallon looked unlikely. Until Burnett won the Delta Air Lines account in 1999, speculation was rife that United would return to the agency that gave it the "Fly the friendly skies" tagline and overlaid its spots with Gershwin's "Rhapsody in Blue." Even after a return to Burnett became unlikely, major players on Madison Avenue continued to salivate at the chance to grab the United business because Fallon's work was largely deemed a failure.

Fallon's "Rising" campaign, which sought to acknowledge problems with air travel and show how United would rise above them, failed to resonate with either customers or employees, a key target in airline ads. It was then pulled, a move Fallon attributes to the concept being ahead of its time. United says it accomplished its goal. Fallon also caused a stir when it dropped the "Rhapsody in Blue" theme for a while, a part of United's image nearly as well-known as the airline's logo, referred to as the "tulip." But somehow, Fallon held on. And in January 2000, the agency launched its "Unity" campaign focusing on the airline's role in connecting people.

"After working with an agency like Burnett for over 25 years, it was almost like getting a new job, and there was bound to be a learning curve in the process," said a United spokesman. "A lot of speculation in the industry about the relationship being on the rocks was simply not true."

One factor that may have played a role in Fallon's survival and the victory last week is the relationship between Chairman Pat Fallon and United Chairman-CEO James Goodwin, which is said to be especially close. Rob White, Fallon's Minneapolis president, downplayed the relationship, although he acknowledged, "The decision would not have been made if it hadn't been blessed by Jim Goodwin."

Other issues that may have influenced the decision include United's recent troubles with massive flight delays and cancellations, which led to financial trouble and customer outrage-and the airline's pending merger with US Airways. United will need to focus on the U.S. market in the near future, and Fallon's experience may have given it the edge.

Creative ideas were not a subject of the pitch, executives close to the review said. Rather, it focused on strategy, capabilities and costs. United said it launched the review in part to achieve cost savings because its recent turmoil has hurt the bottom line. But cost alone was not the deciding factor. "Nobody undersells Y&R," said Laurel Cutler, now a Fallon board member, who served as the consultant in the 1996 United review. Y&R declined comment and referred calls to United; United's spokesman declined comment.

merger was key

Fallon last week touted its recent merger with Publicis as key. The agency made the deal to increase its overseas presence, and United is Fallon's first multinational account. Fallon will dispatch a top senior executive to regional centers including Asia and Latin America and staff offices with local talent, in some cases from the Publicis network, said executives close to the review.

Some United executives apparently felt Y&R was successful in its international work. Local airline marketing officials around the globe wrote letters to their U.S. counterparts backing Y&R. But executives in ports of call usually do not have the influence those back at headquarters have.

A 90-day transition period is expected for the Y&R business to shift over to Fallon. Y&R continues to handle duties for the Star Alliance, the airline marketing grouping led by United and Lufthansa.

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