Facing a recruitment shortfall, the Army put its search for an ad agency back on track-dangling an incentive of sorts in front of prospects. In reissuing a request for proposals for the government's largest ad contract-representing up to $1 billion in marketing spending over five years-the Army said it will guarantee the winning agency a two-year contract followed by annual renewals that could extend the pact for up to five years.
Federal ad contracts are traditionally one-year deals, although it's rare for them not to be renewed. Still, Paul Boyce, an Army spokesman, said the two-year offer "was done to make it more stable and predictable for the [advertising] industry."
That predictability comes with a cost. When the Army extended incumbent Leo Burnett USA's contract earlier this year, it increased spending to $250 million over a six-month period. The latest request returns to a more typical annual budget of $200 million, although actual spending levels are decided by Congress.
Mr. Boyce said the temporary spending boost reflected "our present situation with recruiting, and some [sponsorship] contracts that needed to be paid."
While the Army and Army National Guard met their July goals, overall numbers for the fiscal year continue to trail goals. The Army is the only active military service not meeting its recruitment goal, a stat that could reflect poorly on Burnett as it seeks to retain the assignment.
The Army review has become something of a saga since it was launched in spring 2004, as Burnett's contract was due to expire. After a series of delays and extensions, the Army called off the review last April, citing "inconsistencies in the evaluation approach." In July, it extended Burnett's contract through year end, drawing fire from a watchdog group.