Enfatico’s true cost to WPP : $4 Billion
March 30, 2010
On breaking news that the Dell Account has transferred successfully from Enfatico to Y&R failed the mention one tidbit of information. The $1.5 Billion dollar advertising budget per year (it was a 3 year $4.5 billion dollar budget), magically shrank to $185 million, or better said they are WELL over a billion short per year of what they would have been spending should had Enfatico and WPP done their job (minus recession factors).
They hardly reached the .5 of the $4.5 billion dollar budget.
This is actually the primary story of the headline, but it’s not being discussed for obvious reasons.
The story is developing, but it’s a $4 billion dollar smaller story.
Enfatico’s new HQ … it’s down the road from pets.com
Did WPP and Dell spend a quarter billion on Enfatico?
February 21, 2010
Is there a way to get the actual amount spent on this disaster?
Between Dell and WPP , what literally was allocated to this project, the 10 year leases, the 1000 apple computers bought for Dell, the estimated 600 people on payroll …. etc etc…
Dell said that they would allocate $4.5 billion to the project… but the chances are remote that they got anywhere near that…
That being stated they DID hire hundreds of people, took out roughly a dozen leases, bought nearly a 1000 apple machines… etc etc… they spent money.. big money..
Dell doesn’t line item “Money wasted in Advertising” on their balance sheet… so I guess I need to make a spreadsheet and add it up with estimates..we’re going to do this with really rough numbers because WPP and Dell both refuted our requests for hard numbers due to the embarrassing nature of the question.
But I am guessing it went into at least $150,000,000 to $300,000,000 million range.
The 100,000 Sf office in Manhattan alone would be millions.
My guess is they hired at least 600 people when all the press releases are added up.. if the average salary is $40,000 (when you factor in Boon’s salary with the staffers making $10 bucks an hour)…
So 600 x 40,000 = $24,000,000
Add the customary 30% for payroll taxes, health insurance etc etc…
You got an additional $7,200,000
So you’re looking at roughly $30,000,000 a year for 3 years…
That’s $90,000,000 in payroll alone.
A dozen office spaces at 100,000 a month…
That comes out to be $14,400,000 (12 x 100,000 x 12 months)
So now we’re on or about $105,000,000 (roughly)
Let’s add it an additional 2 million for apple machines, apple software, copies of photoshop, digital cameras, photo equipment, ect etc.
Now you’re getting close to the 110,000,000 mark…
3 years…. of this mess…
How much do desks, phone systems and chairs cost? They didn’t buy that stuff at the thrift store…
I would say between $150,000,000 and $300,000,000 was blown on this project.. that produced one ad in India worth about $2,000 bucks with a small advertising agency.
How many people’s job could be saved with $300,000,000. What new products would Dell have launched with an additional $300,000,000 in the bank?
Yes it’s known that the Enfatico disaster happened.. but did anyone actually look at how much this hurt everyone.. the lost potential income from new products, the mess in terms of lack of advertising. This was a disaster that will have repercussions for the next decade or longer at minimum with the landlord of the buildings that Enfatico signed a 10 year lease with.
So here’s the challenge WPP and Dell .. tell us exactly what the shareholders lost on this?
Good Job Grey NY
February 10, 2010
Wow Digg is sending out some badly targeted ads today.
Recently I posted my personal opinion on why Microsoft / Interpublic advertising deal is bad, really bad. In fact I even titled it “Any Interpublic clients want off Microsoft’s ad system”
Well a picture is worth a 1000 words right? So here is the screen shot on how P&G PANTENE media spend is literally wasting their money. In this case however it’s not Microsoft and it’s not Interpublic, it’s WPP group plc’s Grey NY. They appear to be buying ads though Nexage for Mobile, but do you consider this targeted advertising? Like beautiful hair means so much to Steve Jobs…. Of course click to enlarge the screenshot.
It’s why these big advertising agencies really shouldn’t be learning digital media spends using client money for their classes. These are amateur mistakes with client money.
Shameful.
Dell Ad Agency Enfatico Blog Shut Down
January 20, 2010
The all famous Enfatico Blog, Next Story Board has been shut down. Now everyone that visits the site will be redirected to their main page… the blog has vanished. A call into Enfatico to find out what happened was met with a number being disconnected… ouch.
To make matters worse.. they didn’t even properly redirect it.. it’s just a domain alias rather than a 301 redirect.
I don’t understand this, not at all. Out of all their marketing efforts to promote themselves, the cheapest, lowest cost, highest ROI way was via their blog. Sir Martin should have kept that site up. A hosting account costs 5 dollars a month… many webhosting companies give away domain names for free with a year’s purchase.
The total advertising campaign for you to save face … perhaps even fish for business would be a total of 60 dollars a year.
Have an intern to post on the blog… not just redirect the thing in complete failure. You know you could have kept the appearance of an active company running (we know you are all about appearances) by having some intern post on it daily. Hell you might of been able to sucker some company into allowing you to pitch.
Or most likely, you could have better explained to everyone what is going on, rather than making us think the worst happened… or did the worst happen?
Wow that was poorly executed. No wonder the Dell contract with WPP Group plc expires in 314 days, 13 hours, 21 minutes, 55 seconds .. yet the agency has no blog (and no CEO, and no creatives, just a bunch of empty offices) who the hell is paying for all those office spaces thoughout the planet? What nearly 2 dozen locations, the Manhattan Office with 100,000 S/f (I told you idiots that was a bad idea)?
Is Dell or WPP group plc paying for it? What a waste of resources… In rent alone you could have saved hundreds of jobs… as you got multiple WPP group plc offices, all 25% filled or 0% filled within blocks of each other…
Just freaking stop calling them differing names… that whole model is freaking broken… make WPP just an ad agency.. consolidate all the expenses… put everyone that works at a WPP group plc agency in one building in New York… and duplicate that in Philly, London, and everything else…
I swear by just looking at a spread sheet you can see the amount of people you fired that didn’t need to be if you just used your fixed assets more effectively.
Then you get shit like this where Enfatico going down like the Titanic makes your whole holding company look like a second rate crappy holding company that can’t even keep a client. Honestly I would think twice about doing anything with WPP … after seeing what happened with WPP and Dell.
What do I know? I’m just an idiot with a blog… but clearly that is more than what WPP Group owned Enfatico has right now.
RIP Next Story Board, your entire life of 451 days was well honoured… well not really..
Parker on WPP Group : The final sad, pathetic end of Enfatico
January 11, 2010
George Parker is reporting the following:
This just in from Austin… The “Agency of the Future” has fired all the creative directors, they have taken ninety nine percent of the content out of the website (it’s just a list of offices now.) Torrence Boone is toast after they promoted him to CHAIRMAN, in charge of “special projects.” That lasted all of one month, and then they just bounced him out altogether. Gone. Fucking gone! And no one has a clue where he went.
Talk about game over, this is a complete disaster for WPP group plc. Not that the world didn’t see this coming for years. We even built a countdown clock (that we felt no need to update since Enfatico has been for the most part shut down for some time now)… but part of the new news is that Torrence Boone has been escorted out… and no one knows where he has gone… pretty shocking stuff. What is he up to these days?
See the problem is we can’t blame Torrence, he was given an impossible mission. You can’t build an ad agency like this, not the way Enfatico was built.
A robust advertising agency needs more than just one client, you need to have some sort of cross between industries, some things that work well in one industry might make sense if adapted to another. You need fresh ideas.
Enfatico had no ideas, it was a one trick pony that never actually even got off the ground. For the record, this last paragraph of the report most likely has more weight to it than anything else.
If I was a WPP shareholder I’d have some pretty hard questions for Sorrell before he picks up his $96 million performance bonus!
I felt that over here.
Ad Agency Note : Bing+Yahoo = less than 13% market share
December 7, 2009
Ad Agency WPP group plc along with most of the other advertising agency holding companies recently announced that they are “supportive” of the Yahoo! / Microsoft “search merger” Even though PCworld just noted that Bing was down for 30 minutes, yet no one noticed.
In case you missed it–and most of you probably did–Microsoft’s Bing search engine was offline for about 30 minutes on Thursday evening. (PCworld)
This baffles us, because they are supportive not because of the stellar results that the search engine is providing for their clients, they are supportive because it’s not Google, the largest advertising agency on earth. Let’s face it, hitwise is stating the market share is double digits, but most people are not seeing that in their log files.. not even close.
I know from sites that I have direct access to that Bing’s market share is roughly 8% and falling.
It’s not a small sample, it’s based on nearly 6 million unique visitors per month to a host of websites that we directly measure for our SEO services. In other words the sample is large enough to be accurate.
So consumers don’t like Bing, nor do they like Yahoo .. especially together… but boy.. WPP group loves them. Traditional BDA’s don’t like Google’s view of advertising, they don’t like this new imposed model of what advertising is moving towards.
In other words, they don’t see a need for themselves in that picture.
frenemy has taken a new turn, to the point where Madison Avenue is against anything Google is for, even if it hurts the consumers and clients.
Pretty shady stuff.
Ad Agency Ogilvy cans 90 from both coasts
December 2, 2009
We just got a tip that wpp group plc ad agency Ogilvy just laid off 90 people from East and West coast. … we cannot verify this yet as from what we understand, pink slips are flying at multiple locations simultaneously. Our understanding is that many of these people were working on the same project hence the “coordinated attack” to stop them from taking to each other.. or one office giving a heads up to another.
Story is developing, but on face value it appears that Ogilvy is getting really good at firing people.
Google : Yahoo is a competitor to WPP
November 18, 2009
In a very interesting statement, it appears that Google is saying that Yahoo is a competitor to WPP group plc, but not themselves. A recent check on the stock price of WPP group plc (NASDAQ: WPPGY) showed the following as a list of “Related companies”
So the question is, why is everyone else calling Google an advertising agency. From the linked article “To understand these moves is to realise that Google is an advertising agency;”
But Google themselves and the Advertising agency holding companies?
We believe that if a company looks like a duck, quacks like a duck.. it is a duck. In this case Google provides copywriting services for adwords (IE: creative) they serve those ads via their own content network. They allow for media purchases though adwords though their properties and other peoples properties via adsense, and they provide a way to measure clients ROI via Google Analytics.
That’s not an advertising agency? You have to think about it, just because it’s not a 30 second spot (which they can provide via Youtube in 1080p ) doesn’t mean it’s not an Advertising agency because it’s different than what you are accustomed to.
Then the other question is why does Google say that Yahoo is a competitor to WPP group plc, but not themselves?
Doesn’t this raise any other questions? For example, We’ve been saying for years that JWT should stop using “largest Advertising in the USA” because they are not the largest, that is Google.
So what is your thoughts, most importantly we find it fitting that they called second rate Yahoo! as the competitor. Tells you what Google is thinking.
Ad Agency Denizen sues WPP group plc – Patent Infringement
October 29, 2009
Ad Agency Denizen is claiming to have patented product placement (patent 6,859,936) is suing WPP group plc, for violating the patent. It’s actually interesting on multiple fronts.
First let me go on record as stating that product placement existed for over a century for TV / Video / Movies.. literally I have just pointed out evidence below of it taking place in 1896.
This above video was filmed in 1896… notice the Wheelbarrow mid way though the video where the name of the company is shown in a pretty obvious fashion?
Understand that was filmed in 1896, you’re watching a video that is 113 years old. To be clear, everyone in that video is dead now. Their kids have likely died from old age as well.
Here we are generations after this was filmed.. and yet these people feel that they can patent the wheel and sue for it.
Enfatico loses Advertising Agency of Record Status with Dell
October 5, 2009
The WPP group plc advertising agency, Enfatico has lost it’s agency of record status with Dell Inc. Evidently this has been a fact for nearly 2 months, but WPP group plc swept this fact from the public in an attempt to save face from what we understand, or perhaps better said, never publicized the bombshell.
George Parker wrote the following “Officially (although there have been no releases to the press that I have seen,) Y&R New York is the agency of record for the consumer work. Wunderman, New York, is handling the B2B work”
Well of course there has been no press release, what are they going to release?
Title : “Enfatico complete failure”
Subtitle : “Enfatico, epic fails , never finished countdown clock”
Body: “Only in the minds of Sir Martin and Michael Dell did this make sense…. etc etc”
The entire concept was lamblasted by the media, bloggers and everyone else in between because of the poor business model and of course other reasons.
Our hearts do go out to the employees there, honestly this isn’t their fault… the entire project was designed to fail.
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