Compaq, like nearly every other tech titan trying to navigate the vicissitudes of the Internet economy, needs to make its brand stand for something more than hardware. Executives close to Compaq expect the company to simplify its brand proposition and craft a positioning as an Internet solutions and infrastructure company.
After a painstaking, three-month review process, FCB wrested the account from DDB Worldwide, New York, which participated in the review. DDB's nearly two-year run with the client was characterized as "rocky" and "tumultuous" by insiders. Grey Worldwide, New York, and Saatchi & Saatchi, New York and San Francisco, also were part of the review, though Saatchi executives refused to confirm the agency's involvement. Saatchi handles international markets and media for Compaq rival Hewlett-Packard Co. and has some Sony business in Europe.
Compaq executives said their April 27 selection of FCB, a unit of True North Communications, reflected a desire to tap the power of an agency with a global network and to work with an Internet-savvy partner.
"FCB did an incredible job at resourcing, both on the idea front, interactive and media, and creative resources from around the world," said Gary Elliott, recently named VP-integrated marketing communications at Compaq.
FCB CEO Brendan Ryan said the account win vindicates True North's decision last September to fold Bozell's international operations into FCB.
"It gets you into the pitch, but that doesn't win you the pitch," Mr. Ryan said, adding, "When you win business, it's because of the thinking you bring to the party, the chemistry you form with people on the other side of the table and the people you bring as part of the team."
Mr. Ryan denied a relationship with Mr. Elliott swung the business FCB's way.
But insiders said that relationships drove the outcome. The FCB team consisted of former Ogilvy & Mather executives: Mr. Ryan; Kelly O'Dea, FCB Worldwide president; and Peter Martin, FCB's exec VP-worldwide account director. Mr. Elliott also is a former Ogilvy executive, who worked on the IBM Corp. account in the Asia-Pacific region. Ogilvy's Houston office was Compaq's first agency of record, from 1982 until December 1991 when Ammirati & Puris won the business.
Ken Roman, an ex-Ogilvy chairman and a Compaq board member, was an adviser to the agency selection committee in the "early stages only," he said. Mr. Roman said he wasn't present at the last two rounds of agency presentations and didn't vote.
"DDB had a very strong showing, but FCB gave us the overall proposition," Mr. Elliott said.
One insider added that Compaq was "looking for brand-building, not advertising, in the end."
"FCB won by attrition," said one executive familiar with the pitch. After several meetings, "[Compaq] didn't buy any particular campaign -- they never saw anything they really liked."
To bolster its pitch, DDB, part of Omnicom Group, plumbed its own global resources and sought input from Spike/DDB Chairman Spike Lee to save the account. But the agency ultimately "failed in its inability to lead the Compaq client to a strategic consensus," an executive close to the situation said.
Of the loss, a DDB spokeswoman said: "We enjoyed our relationship with Compaq and we wish them well."
DDB'S ROLLER-COASTER RIDE
DDB's roller-coaster relationship with Compaq began in June 1998 as the agency, in a stunning sleight of hand, snatched the account from Ammirati (now Lowe Lintas & Partners Worldwide) the company's then-agency (AA, June 8, '98). Compaq recently had acquired Digital Equipment Corp. and DDB was Digital's agency of record.
But Compaq was a tough client from the start: There were warring fiefdoms; indigestion after the Digital Equipment merger; industry volatility; layoffs; and ultimately, management churn with President-CEO Eckhard Pfeiffer's abrupt departure last spring.
Now, under Michael Capellas, Mr. Pfeiffer's successor, executives close to the company said there is a commitment to recharging the brand.
"Our objective was to find an agency to rebuild and reshape the Compaq company, and our entire senior management team has publicly committed to investing in the rebuilding and repositioning of the Compaq brand," said David Middleton, VP-corporate communications.
"Nobody understands the company," Mr. Roman said. "You've got a great undermarketed company, a great untold story. They're not just about PCs. They are a major, major player in enterprise computing, servers, storage and services."
Mr. Elliott said he expected the first phase of a global campaign to appear in the third quarter at the earliest.
Young & Rubicam's Landor Associates, New York, also will work with FCB to create a common look and feel across all aspects of the customer experience. "The opportunity to present one voice, one message, integrated across the entire Compaq brand experience will take some time," said Allen Adamson, managing director, Landor.
FCB's coup poses conflicts with a client of sibling shop Bozell, New York -- Unisys. The estimated $40 million information services company's hardware account overlaps with some of Compaq's server products.
"We're evaluating the situation," said Kerry Baker, advertising program director at Unisys.
A potentially even larger conflict exists with Palm, the marketer of handheld organizers that uses a non-Windows operating system. Compaq markets handheld devices that run with Windows software. Spending on the account is estimated at $70 million.
A Palm spokeswoman said the company won't comment on the matter. "We're not at liberty to discuss conflicts," Compaq's Mr. Middleton said.
"We've talking with Palm and Compaq," an FCB executive said.
NOT SO SIMPLE
Meanwhile, FCB registered the slogan "Simply Compaq" for a Web site. The "Simply" theme also is key to Palm's brand positioning.
FCB's Mr. Ryan said the Web site had nothing to do with the concept or strategy presented to Compaq. He also said he wasn't sure whether Palm constituted a conflict, but indicated that boundaries between FCB and Bozell were sufficient so that Bozell's relationship with Unisys should not be jeopardized.
Contributing: Hillary Chura, Alice Z. Cuneo, Bradley Johnson and Laura Petrecca.