Compaq, the world’s largest PC producer, has moved its consumer
account from the Red Consultancy to hi-tech agency Firefly as it
attempts to cut back its pounds 1 million PR budget. The move means an
extra pounds 300,000 in fees for Firefly.
Firefly already handles Compaq’s corporate and technical PR and
consolidation into a single agency is seen as a cost-effective
The decision reverses the one made 18 months ago when Firefly lost the
consumer business to Red.
Hamish Haynes, consumer marketing manager at Compaq said: ’The PR budget
was getting close to pounds 1 million. For some work we were paying
twice over, so we looked at the bills and decided the PR spend was
becoming too large a part of the marketing budget.’
Haynes denied that Compaq is drastically cutting its PR activity . He
said that it is diverting some of Red’s fee money into additional
roadshows and other live events. The consolidated account is still
thought to be worth around pounds 500,000 in fees.
According to Haynes, the switch in consumer agency is also a reflection
of Compaq’s changing needs. Red was appointed to educate non-PC owners
through lifestyle titles. However, increased consumer awareness has made
this ’soft’ approach unnecessary.
Firefly will focus on raising consumer awareness of specific product
features on Compaq models.
Red will continue to work on an ad-hoc basis on European events for
Compaq which also uses Miller/Shandwick for pan-European work. Its
worldwide advertising account was recently switched from Bates Dorland
to Ammirati Puris Lintas.
Earlier this year Compaq expanded production at its Scottish plant in
Erskine which now employs 2,000 workers. It is a market leader in Europe
with 13 per cent of the market. Turnover in 1996 reached pounds 11
billion with profits of pounds 800 million.