DoD's $22.6M Advertising Contract Awarded to Wunderman Thompson LLC Under Full and Open Competition
Contract Overview
Contract Amount: $22,586,340 ($22.6M)
Contractor: Wunderman Thompson LLC
Awarding Agency: Department of Defense
Start Date: 2010-11-18
End Date: 2011-11-30
Contract Duration: 377 days
Daily Burn Rate: $59.9K/day
Competition Type: FULL AND OPEN COMPETITION
Number of Offers Received: 1
Pricing Type: COST PLUS FIXED FEE
Sector: Other
Official Description: MCRC ADV SERVICES - ODC
Place of Performance
Location: QUANTICO, PRINCE WILLIAM County, VIRGINIA, 22134
State: Virginia Government Spending
Plain-Language Summary
Department of Defense obligated $22.6 million to WUNDERMAN THOMPSON LLC for work described as: MCRC ADV SERVICES - ODC Key points: 1. Contract value of $22.6M for advertising services. 2. Awarded to Wunderman Thompson LLC. 3. Procured via full and open competition. 4. Sector: Advertising Agencies (NAICS 541810).
Value Assessment
Rating: fair
The contract type is Cost Plus Fixed Fee, which can lead to cost overruns if not managed carefully. Benchmarking against similar advertising contracts is difficult without more detailed cost breakdowns.
Cost Per Unit: N/A
Competition Analysis
Competition Level: full-and-open
The contract was awarded through full and open competition, suggesting a robust price discovery process. However, the Cost Plus Fixed Fee structure may still allow for costs to exceed initial expectations.
Taxpayer Impact: Taxpayer funds are used for advertising services, with the efficiency dependent on the effectiveness of the campaign and the management of costs under the CPFF structure.
Public Impact
Public funds are being utilized for advertising campaigns by the Department of the Navy. The contract supports the advertising industry, specifically agencies like Wunderman Thompson LLC. The effectiveness of these campaigns in achieving DoD objectives is a key public interest.
Waste & Efficiency Indicators
Waste Risk Score: 50 / 10
Warning Flags
- Cost Plus Fixed Fee contract type can incentivize higher costs.
- Lack of detailed cost breakdown makes per-unit cost analysis difficult.
- Short contract duration (377 days) may limit long-term campaign impact.
Positive Signals
- Full and open competition ensures a broad range of potential bidders.
- Award to an established agency suggests potential for quality service delivery.
Sector Analysis
The advertising sector is highly competitive, with agencies vying for government contracts. Spending benchmarks vary widely based on campaign scope and objectives. This contract falls within the standard range for large-scale advertising efforts.
Small Business Impact
The contract was awarded to Wunderman Thompson LLC, a large business. There is no indication of small business participation in this specific award, which could be an area for future consideration.
Oversight & Accountability
Oversight would focus on ensuring the Cost Plus Fixed Fee structure is managed effectively to prevent unnecessary cost escalation and that the advertising campaigns meet their stated objectives.
Related Government Programs
- Advertising Agencies
- Department of Defense Contracting
- Department of the Navy Programs
Risk Flags
- Potential for cost overruns due to CPFF structure.
- Lack of transparency in detailed cost breakdown.
- No explicit small business subcontracting goals mentioned.
- Short contract duration may limit sustained impact.
Tags
advertising-agencies, department-of-defense, va, do, 10m-plus
Frequently Asked Questions
What is this federal contract paying for?
Department of Defense awarded $22.6 million to WUNDERMAN THOMPSON LLC. MCRC ADV SERVICES - ODC
Who is the contractor on this award?
The obligated recipient is WUNDERMAN THOMPSON LLC.
Which agency awarded this contract?
Awarding agency: Department of Defense (Department of the Navy).
What is the total obligated amount?
The obligated amount is $22.6 million.
What is the period of performance?
Start: 2010-11-18. End: 2011-11-30.
What specific advertising objectives does this contract aim to achieve for the Department of the Navy, and how will success be measured?
The contract likely aims to support recruitment, public awareness, or specific messaging campaigns for the Navy. Success measurement would typically involve metrics like reach, engagement, brand perception shifts, or conversion rates for specific calls to action, depending on the campaign's goals. Detailed performance metrics should be outlined in the contract's statement of work.
How does the Cost Plus Fixed Fee structure mitigate risks of cost overruns for this advertising contract?
The 'Cost Plus' portion allows the contractor to be reimbursed for allowable costs, while the 'Fixed Fee' provides a predetermined profit margin. This structure can incentivize efficiency to keep costs down, as the fee is fixed regardless of actual costs. However, robust government oversight is crucial to ensure only reasonable and allocable costs are reimbursed.
What is the anticipated return on investment (ROI) for this $22.6 million advertising expenditure, considering the competitive landscape?
Quantifying the precise ROI for advertising is complex and depends heavily on the campaign's specific goals (e.g., recruitment, public perception). Given the full and open competition, the agency was likely selected based on a combination of proposed strategy, cost-effectiveness, and past performance. The ROI will be realized if the campaigns achieve their defined objectives within budget and contribute positively to the Navy's mission.
Industry Classification
NAICS: Professional, Scientific, and Technical Services › Advertising, Public Relations, and Related Services › Advertising Agencies
Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES
Competition & Pricing
Extent Competed: FULL AND OPEN COMPETITION
Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE
Solicitation ID: M0026407R0009
Offers Received: 1
Pricing Type: COST PLUS FIXED FEE (U)
Evaluated Preference: NONE
Contractor Details
Parent Company: WPP PLC (UEI: 232931092)
Address: 3630 PEACHTREE RD NE STE 1200, ATLANTA, GA, 90
Business Categories: Category Business, Not Designated a Small Business
Financial Breakdown
Contract Ceiling: $22,586,340
Exercised Options: $22,586,340
Current Obligation: $22,586,340
Contract Characteristics
Cost or Pricing Data: NO
Parent Contract
Parent Award PIID: M0026408D0001
IDV Type: IDC
Timeline
Start Date: 2010-11-18
Current End Date: 2011-11-30
Potential End Date: 2011-11-30 00:00:00
Last Modified: 2011-10-11
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