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IBM Moves All Its Advertising to Single Firm; Industry Reels : Marketing: The move may be the biggest ad account shift ever. The computer maker says the consolidation will bring consistency to its image.

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From Associated Press

International Business Machines Corp. stunned Madison Avenue on Tuesday by consolidating responsibility for virtually all of its advertising at a single agency.

Industry executives said it was probably the biggest advertising account shift ever. Ogilvy & Mather Worldwide was given responsibility for work currently handled by more than 40 agencies worldwide.

The huge computer maker refused to say how much it spends on advertising, but knowledgeable sources speaking on condition of anonymity said IBM spends between $400 million and $500 million a year on ads.

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IBM said having Ogilvy as its lone agency will help it deliver clear, consistent messages more efficiently while getting more mileage out of what it said is one of the world’s best-known brand names.

Critics said IBM is taking a big risk in putting a single agency in charge of such a large account all over the world.

But IBM officials said it was equally risky to continue its old course. With its advertising divided among so many agencies, they said, the company had been projecting many images. Its ads for personal computers looked much different than those for big machines, for instance.

The company, based in the New York suburb of Armonk, has seen its profit and stock price sag in recent years as technology changed its cost structure and pressures mounted from a number of competitors in various segments of the business.

IBM said the selection of Ogilvy resulted from an analysis over the past several months of its advertising and direct marketing strategy by a team of its worldwide advertising executives.

Abby F. Kohnstamm, IBM’s vice president for corporate marketing, said the move to a single agency was a group decision. She said the group decided “we would be better able to maintain and increase brand awareness by having a single agency to leverage IBM and its products around the world.”

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The choice of Ogilvy surprised some industry executives, particularly because Ogilvy is not on IBM’s agency roster.

But the New York-based agency has an international network of 270 offices in 59 countries and impressive creative credentials. Its clients include American Express payment cards, Jaguar cars and Maxwell House coffee.

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