IBM launches e-business on demand

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When Sam Palmisano took over as CEO of IBM Corp. in March 2002, he initiated a new strategy to position IBM as a provider of hardware and software for an “on-demand world.” His strategy was based on a vision of how businesses would operate in the future—anticipating customer needs before they arose and providing products and services on demand to meet those needs.

To communicate this positioning, IBM turned to its agency of record, Ogilvy & Mather, New York, to create an integrated marketing communications campaign that included TV, print, online, direct mail, outdoor and events.

The timing was crucial. Palmisano was scheduled to give a speech in New York on Oct. 30, 2002, to IBM’s top customers and business partners, and he wanted to lay out his vision for e-business on demand. But first, he’d need a broad communications campaign to support the announcement. Palmisano began meeting with IBM’s senior marketing, advertising and agency executives in late August to brief them on his vision.

“Having a real clear line to [senior management] in terms of what they were trying to communicate was a key factor in enabling the agency to develop ideas that could crystallize what we were trying to take to the customer,” said Lisa Baird, VP-worldwide advertising for IBM.

“E-business on demand is our business strategy,” Baird said, pointing out that it’s more than a tagline. “It’s a very good reflection of where we think the industry is headed, which is the ability to harness technology to create on-demand business capabilities for customers.”

After Ogilvy was briefed on the vision, the agency went into the field to conduct research among IBM customers, prospects and other stakeholders, and got the results back in late September.

“We had to get this to the market in four weeks,” Baird said, referring to the deadline for Palmisano’s speech. “Taking it all the way through required a tight team from the communications sector, working tightly with management. We don’t waste a lot of time going through internal processes.”

Ogilvy ran with the campaign, creating an integrated program that was aimed at business and technology decision-makers.

“The complexity of an on-demand world and on-demand computing is a very serious subject,” said Chris Wall, senior partner and co-head of the creative department at Ogilvy. “Right now, the climate for a lot of business investing is not so hot.

“How do you get people engaged in something they may not be interested in to begin with?” he added, referring to the challenge of creating awareness of and interest in on-demand services.

So the agency came up with a fictitious company called Bagotronics, whose product line included a magic business time machine, magic server pixie dust and magic business binoculars. The idea was to contrast the hype of many IT vendors during the dot-com era to the reality of IBM’s business solutions, Wall said.

On Oct. 29, IBM launched a series of teaser TV, online and print ads, as well as a Web site, introducing the phony company but not giving any facts about who or what was behind Bagotronics.

The next day, Palmisano unveiled IBM’s vision for e-business on demand in his speech at the Museum of Natural History in New York. Posters at the venue stated, “There is no business time machine. There are no magic business binoculars. But there is e-business on demand. From IBM.”

The day after Palmisano’s speech, IBM ran an eight-page “manifesto” in The Wall Street Journal, The New York Times and San Jose Mercury News. The piece laid out the IBM vision—how the world has changed; what the future promises, and what IBM can deliver to make this vision a reality.

Print ads were followed by a series of nine TV commercials. The campaign also included direct mail, e-mail and outdoor advertising.

So far, results show the campaign has been a success in meeting IBM’s goals. In the fourth quarter of 2002, TV ad awareness of IBM increased by 20% over the third quarter. And traffic to the Web site was considered successful. In the first four days after the site launched, it had 17,131 unique visitors. The “read our ad” message was seen more than 41,000 times.

IBM Corp.
Campaign: “E-business on demand”
Goal: Create awareness of IBM’s vision for an on-demand world and position IBM as a leader in providing hardware, software and services for e-business on demand
Duration of campaign: October 2002 through present
Integrated elements: TV, print, online, direct, outdoor and events
Results: TV ad awareness for IBM grew 20% in fourth quarter 2002, following the campaign launch
Budget: Not disclosed
Agency: Ogilvy & Mather, New York

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