IBM Plans $110m Boost to Ad Budget

14 March 2001

Bucking the trend of advertising cutbacks among technology companies, software giant International Business Machines announced it is to plough a further $110 million into its ad budget – a 17% boost.

IBM, which yesterday released its annual report, feels that the current economic downturn presents an opportunity to increase sales and gain market share over more ad-shy rivals. “This may be a prime opportunity for IBM to improve its market position,” explained chairman Louis V Gerstner. Continuing in Confucian mode, he added: “The ebbing tide may not beach all boats,” a reference to the sinking value of technology shares.

The company plans a broad ad push targeting senior executives and their tech-savvy underlings who recommend software. About $44m will go on TV ads, $18m onto the web and the rest divided among newspapers, trade publications and outdoor sites in important areas such as Silicon Valley, Boston, San Francisco and Chicago.

The expenditure on internet advertising represents around 15% of the campaign’s total, double the normal amount – a commitment Steven A Mills, IBM’s senior vp-software, called “a sign of optimism”.

News source: Wall Street Journal