EDS Rebuilds Its Image

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Until 2000, if you asked the average person what, if anything, he or she knew about a company called Electronic Data Systems (EDS), you would probably get a blank stare. Some might associate the company with Ross Perot, the company's founder and former presidential candidate, and know that he later sold EDS to General Motors, but it is unlikely they would know anything more. Perot founded EDS in Dallas, Texas, in 1962 with the somewhat radical notion that organizations would hire an outside company to handle all of their computer operations. At the time, the word "outsourcing" had not even entered the business lexicon. However, the idea caught on quickly and EDS came to rule the industry it created, which was evolving beyond just computers into information technology services (ITS). EDS grew exponentially after being acquired by General Motors in 1984 and became a $14 billion giant before splitting off from the automaker in 1996 and becoming an independent company. In many ways the success EDS had under General Motors' wing turned out to be a competitive handicap. A hefty annuity from GM provided a steady revenue stream that lulled the company into complacency and fostered an unwillingness to change even though the world was changing all around it, particularly with the rapid growth of the Internet.

In early 1999, EDS hired a new CEO, Dick Brown, who realized that he and his management team had to do more than reinvent the company—they had to remake its identity and brand image. EDS was perceived as a stodgy, old-economy firm in a new-economy industry and was being eclipsed by flashier firms such as Razorfish, Scient, and Viant, which focused purely on e-ser-vices, as well as a reinvented IBM, which had rebuilt its identity around the themes of e-business. Brown hired Don Uzzi, whose record

included leading a marketing turnaround for Gatorade in the 90s, as EDS's senior vice president of global marketing and advertising and put him in charge of rebuilding the company's image. Brown wanted Uzzi to build awareness of EDS and make the company a household name. However, there was also a second, equally critical goal: to market EDS to its own employees and make them feel good about working at the company.

The first area Brown turned to in establishing EDS as a power brand was advertising. EDS began working with the Fallon McElligott agency, which came up with a new tagline, "EDS Solved," that was chosen to position the company as a problem solver in the complicated, ever-changing world of e-business. While print work broke in the fall of 1999 with full-page ads in The Wall Street Journal, New York Times, and other major publications, the company did not limit its newfound boldness to advertising. Uzzi decided the Y2K fervor provided an opportunity for EDS, which had a thriving year-2000 conversion practice in place, as a publicity opportunity. He arranged for EDS's strategic command center in Plano, Texas, to be opened to the media on New Year's Eve night. More than a dozen journalists showed up, and CNBC and CNN did live feeds from the command center, as did local TV crews. Uzzi noted: "We showed the world what EDS does and how we do it. That's something the company never would have done before." Once the new year passed with few glitches, EDS celebrated with a full-page "Y2KO" ad in The Wall Street Journal, calling attention to the role the company played in helping the world get ready for the date change.

The risk taking continued when EDS ran its now-famous "Cat Herders" ad during the 2000 Super Bowl. The Super Bowl is advertising's biggest showcase and is usually reserved for major advertisers rather than companies such as EDS, which was nearly invisible in the ad world. The commercial was shot in the style of a John Ford old-style western—big sky, big country, stirring musical score— and featured cowboys herding 10,000 house cats. Uzzi noted that herding cats is an information management metaphor for organizing an overwhelming amount of varied data and captures perfectly what EDS does: "We ride herd on complexity. We make technology go where clients want it to go." The commercial was one of the most popular of the Super Bowl ads, and the EDS website received 2 million hits in the first 24 hours after the ad ran and 10 million hits in the first week. Clients called from all over the world, asking for tapes of the commercial to play at meetings, and EDS parlayed the ad's success into a high-profile presence at trade shows.

EDS followed the "Cat Herders" spot with two more high-profile commercials including an ad that debuted on the 2001 Super Bowl called "Running with the Squirrels," which was a spoof of the traditional running of the bulls in Pamplona, Spain, and sent a message about the importance of staying nimble in business. The second commercial was called "Airplane," and it compared what EDS does to building an airplane while it is in the air. Follow-up research shows that the trilogy of commercials resulted in a doubling of the percentage of people associating EDS with e-business solutions and a 50 percent increase in overall brand awareness.

In 2002, EDS moved its advertising in a new direction with a series of commercials and print ads designed to move beyond creating awareness and provide businesses with a better understanding of each of the EDS lines of business—information technology outsourcing, hosting, and security/privacy.

In just two years, a lot more people in the corporate world have become aware of EDS and now view it as a hip, hardworking company that can provide solutions to information technology problems. In addition to helping generate business, EDS's advertising has created excitement among its employees and helped attract new talent to the company. EDS wants its advertising to continue to lead, surprise, and impress its customers as well as its own employees. It is likely that it will.

Sources: Suzanne Vranica, "Cats Corralled: EDS Ads Go Back to Basics," The Wall Street Journal, Feb. 8, 2002, p. B9; Tom Wasserman, "Brand Builders," Brandweek, Feb. 11, 2002, pp. 17, 18; "Reinventing the Brand," Fortune, October 2001, p. 112.

The function of all elements of the integrated marketing communications program is to communicate. An organization's IMC strategy is implemented through the various communications it sends to current or prospective customers as well as other relevant publics. Organizations send communications and messages in a variety of ways, such as through advertisements, brand names, logos and graphic systems, websites, press releases, package designs, promotions, and visual images. Thus, those involved in the planning and implementation of an IMC program need to understand the communications process and how it occurs. As you can see from the opening vignette on the EDS Company, the way marketers communicate with their target audiences depends on many factors, including how much customers know and what they think about the company and the image it hopes to create. Developing an effective marketing communications program is far more complicated than just choosing a product feature or 138 attribute to emphasize. Marketers must understand how consumers will perceive and interpret their messages and how these reactions will shape consumers' responses to the company and/or its product or service.

This chapter reviews the fundamentals of communication and examines various perspectives and models regarding how consumers respond to advertising and promotional messages. Our goal is to demonstrate how valuable an understanding of the communication process can be in planning, implementing, and evaluating the marketing communications program.

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