Microsoft's Near Dismissal of JWT Last Week Followed A Series of Warning Signs | Adweek Microsoft's Near Dismissal of JWT Last Week Followed A Series of Warning Signs | Adweek
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JWT & Microsoft: The Thrill Was Gone

How the agency lost its grip on the account
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Looking back, Microsoft’s decision nearly two months ago to hire Crispin Porter + Bogusky to create ads around Bing’s new collaboration with Facebook was a telltale sign of stress in JWT’s three-year-old relationship with the software giant.

JWT had launched Bing with great fanfare in 2009 and helped grow the search engine’s market share to 30 percent, winning awards for effectiveness along the way. Yet Microsoft solicited other roster shops on a key project—a red flag to any lead agency. JWT and Droga5 also pitched work.

Despite that chink in its armor, however, JWT never imagined losing both Bing and Office in one fell swoop last week. “We weren’t expecting the severity of this,” said one executive.

The move left the WPP Group agency that with just a single brand assignment: Windows 7 in China and Brazil. An account that at its peak generated more than $50 million in global revenue had been whittled down to $10 million.

The latest JWT loss was Deutsch’s gain. Eight months after poaching business-to-business advertising from JWT, Deutsch added the B2B pieces of Office. Collectively, those assignments represent about $30 million in revenue.

Microsoft confirmed the hiring of Crispin for the Bing “social search” assignment but has yet to name a new lead shop for the brand. One option may be Droga5, which has handled branded entertainment projects for Bing in the past.

Beyond the initial shock of losing so much business, JWT naturally will have to deal with the inevitability of staff cuts. About 60 employees work on Microsoft at the shop’s headquarters in New York. Days after Microsoft’s Mich Mathews notified JWT CEO Bob Jeffrey of the shifts, agency executives remained upset, particularly given the success of their work.

Many pointed to last year’s exits of North American leaders Rosemarie Ryan and Ty Montague as a turning point in the relationship. Ryan, who was president of the region, and Montague, who was co-president and chief creative officer, were key to JWT landing on the roster in 2008 and spent much of the next two years shepherding—and growing—the business.

Along the way, Ryan and Montague developed a kinship with Mathews, who told Adweek at one point that the duo reminded her of an “old married couple that finishes each other’s sentences and kind of know where one another is going, but are so distinct and different that it really is one plus one equals four.” Agency-marketer relationships don’t get any better than that. But then the duo split to open their own consultancy, and the bond with JWT was never the same. As one agency exec put it, “When two people form such a deep relationship with a client and are seen an integral to the relationship, that is difficult to overcome.”

A Microsoft representative chalked up the move to “business best practice,” coolly noting that the company “regularly evaluates its agency mix to ensure we retain the most qualified partners.”

Indeed, JWT felt the same chill that onetime lead global shop McCann Erickson experienced back in 2008 and 2009 when it defended and lost its grip on the account piece by piece.