Navy Puts Account in Play

LOS ANGELES The U.S. Navy has begun soliciting bids for a new advertising contract, according to Capt. Thomas Buterbaugh, director of advertising and marketing, Navy Recruiting Command in Millington, Tenn.
The incumbent agency, Interpublic Group’s Campbell-Ewald, Warren, Mich., is expected to defend, said Buterbaugh. “The contractual limits [of the current pact lead] us to resolicit and recompete the work,” he said. “I hope [Campbell-Ewald] will be in the list of competitors.”
“This is all about new contract requirements,” said Mark Benner, corporate communications director at the agency. “We’re extraordinarily proud of the work we’ve done for the Navy and look forward to retaining this business.”
Buterbaugh explained that Campbell-Ewald had handled the Navy’s advertising for five years when its previous contract ended in 2005. At that time, the deal was renewed as a single-year contract with four optional years, with the Navy’s annual marketing budget pegged at $90 million.

He said the Navy spent considerably more than that, about $125 million in 2005; $115 million in ’06; and $170 million in ’07 — with much of the outlay in non-measured media such as event marketing. (The Navy spent $40 million in traditional measured media last year, per Nielsen Monitor-Plus.)

The Navy has not determined the value of the contract to be awarded; the request for information also does not specify what the budget would be.

That compressed spending has exhausted the limits of the current contract and necessitates a new one with renegotiated terms. Campbell-Ewald’s current contract ends in November.
“This is no reflection on our satisfaction with Campbell-Ewald,” Buterbaugh said. “Because we are getting great support from Navy leadership, we plan to reach the limit of our resourcing soon, so we’ve accelerated the competition for a new contract.” He added that additional funding would come from congressional supplemental sources, though he declined to predict future spending.