Computer retailer Dell has moved its multimillion-dollar consumer advertising account away from Montreal’s Sid Lee to Y&R in the U.S., Dell’s global brand agency of record.
A Dell spokesman told Marketing “we’re making the move to align our consumer marketing activities more closely with the Dell brand and build on an existing strategic partnership with Y&R.”
Dell was one of Sid Lee’s top three clients by billing. The agency opened an office in Austin, Texas last year to be closer to Dell’s head office.
Yanik Deschenes, vice-president of global PR and communications for Sid Lee, acknowledged that there will “definitely” be layoffs as a result of the account loss, but said the agency is trying to accommodate those affected by moving them into the more than 40 positions the agency is currently looking to fill.
“The problem we’re facing is the right casting” to make sure those on the Dell team fit with the opportunities still available, he said. “We may have to proceed to layoffs.”
Deschenes said the Austin office will remain open for the time being, though the outpost has never grown beyond four people with much of the Dell work done from Toronto and Montreal.
“We want to be present in the U.S. At first, our expectations were for Austin because we had Dell there. With [Dell’s] decision, will we want to remain in Austin or move to another another place in the U.S.? That’s the question we need to answer now.” (There have been rumours that Sid Lee was looking to expand into New York.)
In recent years, Dell has had shaky relationships with its marketing agencies. In 2007 it began working with Enfatico, an agency WPP opened specifically to serve Dell’s global consumer and B2B marketing needs. The arrangement proved untenable, however, and Enfatico collapsed in 2009 into a much smaller organization—a subsidiary of Y&R, which took over as global brand AOR.
The consumer portion of the account, however, went to Sid Lee in February 2011 following a review. By March, the agency had opened a satellite office in Austin, Texas, to be closer to its client.
By July, Sid Lee’s “More You” campaign had hit the market.
Adweek reported last week that Sid Lee’s main client at Dell, Paul-Henri Ferrand, had taken a new assignment in Singapore and was replaced by Allison Dew as VP of marketing for Dell’s global consumer business.
Despite this loss, Deschenes said the agency is still on track to see a 15% increase in annual revenue, helped by two recent international account wins. The agency would not provide further details on who the new clients were.
The transition to Y&R is expected to be complete later this year.
