Rivalry: FCB bests DDB, nabs $100 mil Qwest acc't

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Interpublic Group of Cos.' Foote, Cone & Belding Worldwide took the Qwest Communications account back from Omnicom Group's DDB Worldwide last week, the most recent salvo fired in one of advertising's most bitter rivalries.

Since 1996, when DDB snared the $70 million Clorox Co. account after 71 years at FCB, San Francisco, the dislike has been palpable. It intensified last year when PepsiCo moved $350 million in business from FCB to DDB, Chicago spinoff Element 79 because of conflicts with Interpublic client Coca-Cola Co. Moreover, FCB also lost some 50 staffers to Element 79.

But FCB has struck back twice in the last two weeks. It beat out DDB for the $125 million California Lottery account, leaving DDB to inform the state of its intent to protest the decision. Then, last week the agency was handed the $100 million Qwest business DDB had.

One FCB executive said: "You bet there's a rivalry. And if you didn't think they were going to protest the Lottery decision before [Qwest's move], you can bet your bottom dollar they're going to do it now."

DDB declined to comment on Qwest and its rivalry with FCB. The shop confirmed it had informed the Lottery of its intent to protest, but declined to comment further.

Qwest selected DDB in April to handle its account. DDB put together a virtual agency, DDBq, and in its pitch promised to save Qwest about $9 million in fees. But in June, a series of management changes took place with new CEO Richard Notebaert coming aboard from Ameritech. The company has acknowledged some accounting improprieties and Aug. 8 reported second-quarter losses of $1.14 billion.

But the troubled telecom believes it can turn around its fortunes if the Federal Communications Commission approves its application to provide long-distance service in 14 western states.

long distance

"FCB really understands long distance," said Joan Walker, senior VP-corporate communications for Denver-based Qwest. Ms. Walker, in consultation with the heads of Qwest's various business units, made the decision to switch agencies after being on the job for only a month. "FCB is a Secretariat in the telecom sector. If you want to win the Triple Crown, you go with Secretariat."

Qwest executives have said that FCB was a "close second" to DDB when the original selection was made. But Qwest might have been smarting from memos believed to have been sent from DDB's media-buying arm, OMD, that alerted media outlets and production companies to get paid up front, as inquiries into Qwest's accounting possibly threatened its ability to pay for services. OMD didn't return calls for comment.

"I've not seen a memo," said Ms. Walker. "I have no idea where this has come from. Our biggest and most immediate concern is if we're fortunate enough to get the [FCC] approval." She also said the $100 million in billings is flexible. "It depends on what happens with the long distance."

FCB Chairman-CEO Brendan Ryan and New York president Jeff Tarakajian spent two days in Denver earlier last week wrapping up the account shift. "I didn't think it was a clear-cut victory for [DDB] a few months ago," Mr. Tarakajian said. "I thought we were a close second and we had many people at Qwest who did select us during the [review] process."

Mr. Tarakajian said the account will remain in FCB's New York office. It is unclear whether DDB will need to cut staff in the wake of the move.

contributing: tobi elkin, kate macarthur

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