Reversal of Carly Fiorina Strategies Impacts Ad Agencies

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NEW YORK (AdAge.com) -- Hewlett-Packard co. is reviewing up to $2 billion of ad business as it sweeps away the corporate-branding vision favored by the deposed CEO Carly Fiorina.
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The tech giant is devolving marketing power and responsibility -- centralized under Ms. Fiorina -- to its individual business units: the PC division; the imaging and printers division; and the trade-focused enterprise division. In doing so it is realigning its agency relationships so shops are matched with divisions, region by region, rather than on a corporate basis.

Agency impact
Most notably the realignment gives Omnicom Group a chance to eat into a major Publicis Groupe relationship. The ongoing evaluation of agencies is pitting longtime roster shops Omnicom’s Goodby Silverstein & Partners and Publicis’s Publicis & Hal Riney, against each other in a shootout for global creative duties for the PC group, traditionally a Publicis stronghold.

In June, HP split the PC business from its printer business just five months after combining them and named R. Todd Bradley, a former PalmOne executive, to head the computer division, which makes notebook and desktop PCs as well as hand-helds, monitors and workstations.

The personal-services group, as the PC group is known, is seeking a global advertising solution from its roster shops. Goodby, whose branding work in the past has been exported to and translated in international markets, is known to have contacted sibling ad network BBDO Worldwide about assisting on the pitch because of its international reach.

Imaging and printer group
HPs imaging and printer group has reviewed its relationships and has given Goodby North American duties. A collection of Publicis agencies will handle it in Europe and Asia, said knowledgeable executives.

These moves, according to the executives, are being driven by a new operationally focused management team more interested in making the cash register ring than pushing out the kind of one-brand vision that Ms. Fiorina was known for.

HP’s agency relationships around the globe had been consolidated at Goodby and Publicis. Over time, the distribution of the work between the two shops had fluctuated, with HP occasionally conducting shootouts for major assignments. HP spent $1.8 billion in each year 2003 and 2004 on global advertising, making it the largest worldwide advertiser in its field.

Departure of top execs
HP marketing was thrown a double curve early this year, first by the departure in February of Ms. Fiorina who took a keen interest in marketing strategy, and then just weeks later, by the abrupt move by top marketing executive Allison Johnson, who left to take on the chief marketing job at Apple. The two women were confidantes, and both believed whole-heartedly in a united divisions marketing and business strategy for HP.

To that end, HP shifted significant portions of its budget to creating branding work over individual product ads under Ms. Fiorina and Ms. Johnson since 2001. The two had drawn HP’s corporate branding closer to Goodby, the agency responsible for setting the company’s image and creative direction. Riney and other Publicis shops worldwide handled product work and other functions.

“Goodby and Publicis continue to do great work for us and serve as our principal agency partners. We have no plans to make a change at this time,” said HP spokesman Ryan Donovan. The agencies referred calls to HP.

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Beth Snyder Bulik contributed to this report.

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