McCann Relationship Marketing, New York, which continues to handle the bulk of the direct account for UPS, previously was the agency on the assignment, estimated at more than $30 million.
The new account, to be managed out of Rapp Collins, Chicago, comes just two months after SBC Communications chose Rapp to handle its consolidated direct-response advertising, estimated at about $200 million, following the telco's acquisition of Ameritech.
Malcolm Speed, CEO of the Omnicom Group agency, said new-business wins such as SBC and UPS will likely account for one-third of Rapp Collins' total 2000 revenue, double new business revenue in 1999. Rapp Collins had revenue of more than $312 million last year.
Mr. Speed said Rapp Collins is in a good position to garner new business as companies increasingly turn to large marketing agencies to handle strategy and client analysis as well as communications work.
EVOLVING AGENCIES' ROLE
"There's rapidly becoming a larger gap between the larger agencies and the small agencies in terms of capability because of this," he said. "The agency's role is really evolving to be an intermediary, to explain to the client about their client base and then deliver the communications."
The work, which will involve strategic planning and database analysis directed at targeting medium and small business customers, will include expertise provided by Rapp units such as Rapp Digital, Marketing Technology Group, InfoWorks, Focus Agency and Optima Direct.
Rapp previously has handled business customer acquisition and retention for UPS Canada through its Toronto office.
Brian Whipple, 34, who recently came to Rapp from Technology Solutions, Chicago, will fill a newly created senior VP-marketing director position overseeing UPS.
`A SIGNIFICANT ACCOUNT'
Initial planning sessions between Rapp and UPS have gone well, according to Ian Baer, president of Rapp Collins, Chicago.
"For us this is a significant account," he said, estimating that it would represent a large chunk of billings for the Chicago office.
Billings for Rapp's Chicago office were approximately $40 million last year and are expected to pass the $70 million mark in 2000 through the addition of UPS as well as work on SBC's wireless and paging business.
A UPS spokeswoman said the relationship with Rapp adds new capabilities that haven't been part of earlier direct marketing efforts, including strategy work and increased customer-relationship management efforts.
UPS had revenues of $27.1 billion and shipped 3.28 billion packages and documents in 1999. The spokeswoman said other UPS ad accounts currently are not under review.
Lowe Lintas & Partners, New York, is UPS' agency of record.