Microsoft Plays the Agency Field

NEW YORK McCann Erickson’s lead agency status on Microsoft has waned as the marketer has once again asked its growing roster of core agencies to compete for a jump-ball assignment, said to be for a new mobile application. The current competition, with the code name “Pink,” is expected to be completed in May, sources said.

Microsoft shops McCann, Crispin Porter + Bogusky and JWT, which all referred calls to the client, are said to be in the fray.

It’s the fourth time in 17 months that the software giant has reached beyond McCann in seeking new ideas for a key assignment, most of which have been new. In February 2008, Crispin joined the Microsoft roster, landing the $300 million Windows consumer products assignment; in July, JWT broke into Microsoft’s ranks, taking the $150 million “People Ready” business from McCann. Earlier this month, JWT won creative duties on a $100 million assignment for a new search product. While globally Microsoft is still McCann’s single-largest client, the agency has not prevailed in any of the recent competitive pitches.

Gayle Troberman (pictured above), Microsoft gm, advertising and customer engagement, would not confirm the review. However Troberman, named to her new role a year ago, said that since then Microsoft has widened its roster to include four creative agencies: JWT, Crispin and Razorfish, alongside McCann. Universal McCann remains Microsoft’s media partner.

“We think of all of our agencies as equal,” she told Adweek on Friday. “We have deep relationships with all of our agencies but we believe in the ‘controlled competition’ factor. It keeps us and our agencies approaching new assignments in a way that brings different talent and experience to bear upon the project.”

Troberman also confirmed that Microsoft has consolidated its customer relationship marketing business at Wunderman, eliminating McCann Worldgroup’s MRM Worldwide from its roster of agencies, beginning July 1. In 2004, Microsoft consolidated that CRM work at Wunderman and MRM, with global billings estimated at $400-500 million. (The net gain for Wunderman could not immediately be determined.) While MRM may continue to handle Microsoft projects, it will no longer be on retainer.

MRM had already been losing ground: Last December, for instance, DDB Seattle, a Microsoft agency of more than 10 years, won the review for Microsoft Office Live Small Business review, in which MRM was the incumbent. For the DDB office, which counts Microsoft as it largest client, the win was the fourth piece of Microsoft business picked up last year.

Sources said Microsoft’s move away from reliance on McCann Worldgroup is being driven from the top of the company. According to agency sources, Kevin Turner, Microsoft’s chief operating officer who joined the company in August 2005, is not a proponent of a single agency partner and has pushed for bringing in other shops.  “He does not believe in monogamy, he wants a stable of agencies. He comes from more of a procurement background,” and wants that competitive edge in agency compensation, said a source. Turner came to Microsoft after 20 years at Walmart, where he was chief information officer and most recently CEO of Sam’s Club.

While Worldgroup’s influence may be lessening at Microsoft, Troberman said “McCann is still very much a core agency for us.” She added that the agency handles a lot of work that is less visible-like b-to-b-but that “is incredibly important to us”.

Troberman, who was previously Microsoft global gm, branded entertainment and has more than 13 years at the company, said, “There’s been a significant amount of change over the past year and we’re seeing results business by business, audience by audience.” -with Andrew McMains