Online auction: Ogilvy wins DuPont global biz

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One of the more unusual creative reviews of the year ended last week with DuPont naming WPP Group's Ogilvy & Mather Worldwide as its lead global communications agency for an account with billings estimated at over $70 million in the U.S. alone.

The review sent ripples of concern through the agency world as the marketer required competing agencies to participate in an online-compensation auction, a process the shops feared would make price, and not capabilities, a leading factor in the decision.

For both DuPont and the finalist agencies, the auction component was a new experience, but it doesn't appear it will remain a novel one.

way of the world

"That's the way the business world is headed," said William Gray, president, WPP's Ogilvy & Mather Worldwide, New York. "Companies are using whatever they can to improve productivity. ... The online auction was fascinating, because it was unprecedented." During the hour-long auction, agencies submitted their best price for a specific number of hours by skill category and geography, competing against an unidentified lowest bidder.

A core team of 20 marketing executives decided on 12 criteria that agencies had to meet. These included brand-building, creative excellence, industry knowledge and budgetary efficiency. Each agency was scored and ranked according to DuPont's methodology. "Price, while not insignificant, was less than 25% of our total consideration," Scott Nelson, global DuPont brand manager, said. The winning agency, he said, was not the lowest bidder. Responses for the request for proposal, which was sent to nine agencies, composed more than 50% of an agency's score.

Ogilvy won the three-year contract over sibling Y&R Advertising; Interpublic Group of Cos.' McCann-Erickson Worldwide and Foote, Cone & Belding Worldwide; and Publicis Groupe's Saatchi & Saatchi. "It all seemed fair...[but] we don't like the idea of having non-commodity services served up in a low-bid environment," said Scott Gilbert, managing partner, Saatchi. The other agencies declined comment or didn't return calls.

Over the next seven months, DuPont will consolidate marketing communications efforts for five of its six global businesses at Ogilvy. "DuPont is a powerful brand," Mr. Nelson said. "But we want to connect it more strongly to our science-company positioning, and to build the brand in a way that is consistent with the way our business units hope to grow."

After a corporate restructuring last year that created six "growth platforms"-one of which is slated as a spinoff-DuPont management now aims to develop a marketing strategy that builds each using the strength of DuPont's brand name.

"This was a big move for [DuPont] and for each of our communications professionals," Mr. Nelson said. "Most of us had not participated in an online auction."

Asked for the process' pros and cons, Mr. Gray said, "We won, so the process was fair. Of course, not having to pitch is the best option. The process covered all elements you'd expect in as comprehensive a pitch as this one."

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