Gateway: Searching for the Right

Advertising Agency

Group 9

Paridhi Trivedi 19DM131

Parima Choudhry 19DM132
Prateek Tomar 19DM141
Rishabh Bhalla 19DM160
Romani Banerjee 19DM167
Saral Jaswal 19DM184
 An organization hires an advertising agency in order to promote their product expecting an increase in
profits, sales volume, market share, consumer awareness and brand image. The idea behind Gateway;
like any other company, changing its advertising agencies, revolves around the above mentioned factors
as well.
• Brand Image/Consumer Awareness/Differentiation
The highly competitive market of technology and an increase in the convenience provided by it has
forced the consumer to be tech savvy and value conscious. Building a differentiating factor was of
SOLUTION 1 utmost importance for Gateway which the company was struggling with when compared to HP,
Compaq, Dell etc. The company changed its ad agencies 5 times over the past 6 years and 3 times in a
period of 14 months from early 2002 to 2003. A week after dismissing DMB&B, McCann-Erickson was
Analyze Gateway’s decisions to hired. In April 1998, the company dropped 2000 from its name due to the thought that it would seem
dated in the coming millennium. The company also introduced a new logo with a hand drawn version of
the signature cow spot box. The company was clearly trying to build a brand image with a
change advertising agencies so many differentiating factor in the minds of the customers. The company later fired McCann-Erickson to
change its brand perception as a folksy brand.
times over the past six years. • Sales Volume/Market expansion/Globalization
The company’s sales in the European, Japanese and other international markets was increasing therefore
Identify and discuss specific factors the company decided it needed a global agency. In 1997, the company moved approx. $70 million
worldwide account to DMB&B which was a global agency. Its European and Japanese creatives were
that may have led to each decision to handled by a London based agency name Finex.
• Profit Maximization
change agencies. Gateway constantly tried to increase its profits by increasing its sales volume by changing the theme of
the ad a number of times. Gateway’s revenue reached an all time high in 2000 hitting $9.6 billion while
the company’s market share was the third highest (8.2%). Gateway ran ads featuring actor, Michael Fox
in 2001. Alongside, the company was also discussing the future of such ads with other agencies. After
Wietzen’s resignation, Ted regained control of the operations and stated a net loss of $94.3 million in the
4th quarter of 2000. Following this, Gateway fired McCann-Erickson and decided to change its corporate
image and present the company as a maker of sophisticated computers with advanced technological
components. Gateway even used ads developed by Siltanen/Keehn to gain profits while introducing new
products in the market post which, the company hired the Arnell group as its ad agency to get through
the Christmas shopping season. In 2002, Gateway reported a loss of $309 million and decided to hire
Leo Burnett in 2003.
Timeline

• Carmichael Lynch (1993)

• Finex

Timeline • DMB&B (1997-1998)

• DiMassimo and Henry Corra (1998)
• McCann-Erickson (1998-2000)

• Henry Corra (2000-2001)

• Siltanen/Keehn (2001-2002)
• Arnell Group (2002-2003)
• Leo Burnett (2003)
 Gateway’s frequent agency switching has significantly affected the company’s branding and positioning
efforts and because of these constant changes the company has not experienced a sense of consistency in
its advertising and has gone through difficulties because of these rapid changes.

SOLUTION 2 The company has changed its taglines/campaigns/themes more than 8 times within the last 6 years. Some
of the these include- “You’ve got a friend in the business”(1994 to 1997), “Yourware”(1999),
“Gateway@Work”(business-to-business) (1999), etc.
Discuss how Gateway’s frequent
Over all of the years the company has undergone both type of switching- outside agency switching and in-
agency switching has affected the house agency switching. Gateway used to do only print advertising until 1993, but as the company grew it
also added television ads to its combination. The company’s first outside agency which was hired to
company’s branding and handle its television ads was Carmichael Lynch, Minneapolis. The first in-house advertising department
was DMB&B’s.
positioning efforts. What As it can be deducted from the case, Gateway has always positioned itself as a company that solves the
problem of its customers while assisting them in understanding technology and how technology can help
recommendations would you make the potential customers in their daily lives. The company also hopes and expects to transfer Gateway’s
approachable and helpful image to the business market, the company with the help of various change in
to Gateway management regarding advertisements focusses on positioning itself as a solution provider company.

its agency switching and its impact

Recommendations:
on the company? • The company should stop switching the agencies as because of this the actual delivery of the efforts is
being compromised and is negatively affecting the promotional performance of the business.
• Ad agencies is the birthplace of informative and transformative ideas, therefore, it should be
supported at all times.
• A company should not keep on changing ad agencies as the strategy of the company can be leaked-up
to its competitors.
• Regular relationship with a single agency can be valuable which can also build the trust among each
other.
 As an executive at an advertising agency, I would definitely advise my
account development team to pursue the company’s business even if
Gateway has been known to switch to various ad agencies in the past. I
SOLUTION 3 would recommend the business, primary reason being the brand image of
the organization, its motive to provide maximum value to its customers
and the opportunity of adding a brand name like Gateway to our business
If you were an executive at an portfolio. Although Gateway has changed its ad agencies several times, it
advertising agency and Gateway’s has also reinitiated business with the ad agencies they collaborated with,
in the past, at multiple instances. The objective would be to focus on
decided to switch agencies again, creating ad campaigns in sync with the brand perception they intend to
would you advise your account create. By providing value to the client, the goal would be to create a
long term relationship with the company as value for the client would
development team to pursue the lead to building value for the company which in turn would be profitable
company’s business? Why or why for the agency. The agency would also aim to create campaigns keeping
in mind the history of Gateway’s campaigning performances and pitch in
not? ideas according to our own expertise rather than just adhere to what
company wants to portray. A lot of analytical expertise would go into this
to conclude what really works well for the brand and on what occasions.