Commerce Dept. awards $404M advertising contract to Young & Rubicam LLC for Census Bureau support

Contract Overview

Contract Amount: $404,482,411 ($404.5M)

Contractor: Young & Rubicam LLC

Awarding Agency: Department of Commerce

Start Date: 2018-11-21

End Date: 2021-03-31

Contract Duration: 861 days

Daily Burn Rate: $469.8K/day

Competition Type: FULL AND OPEN COMPETITION

Pricing Type: TIME AND MATERIALS

Sector: Other

Official Description: AWARD OF OR 015 UNDER 2020 ICC IGF::OT::IGF

Place of Performance

Location: SUITLAND, PRINCE GEORGES County, MARYLAND, 20746

State: Maryland Government Spending

Plain-Language Summary

Department of Commerce obligated $404.5 million to YOUNG & RUBICAM LLC for work described as: AWARD OF OR 015 UNDER 2020 ICC IGF::OT::IGF Key points: 1. Contract value represents a significant investment in advertising services for a major government agency. 2. The full and open competition suggests a robust market for these services, potentially leading to competitive pricing. 3. Performance period spans over two years, indicating a sustained need for advertising expertise. 4. The contract type (Time and Materials) allows for flexibility but requires careful monitoring of labor hours and rates. 5. This award positions Young & Rubicam as a key partner for the U.S. Census Bureau's outreach efforts.

Value Assessment

Rating: good

The award of over $404 million for advertising services to Young & Rubicam LLC appears substantial, reflecting the scale of the U.S. Census Bureau's needs. Benchmarking this against similar large-scale government advertising contracts is challenging without more specific service details. However, the price per day of the contract is approximately $470,000, which, while high, may be justified by the complexity and reach required for Census Bureau campaigns. Further analysis would involve comparing specific task orders and labor rates to industry standards.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under full and open competition, indicating that multiple bidders had the opportunity to submit proposals. The specific number of bidders is not provided, but this procurement method generally fosters a competitive environment, which should theoretically lead to better pricing and service offerings for the government. The Census Bureau's decision to use full and open competition suggests confidence in the market's ability to meet its diverse advertising needs.

Taxpayer Impact: A full and open competition process is generally favorable for taxpayers as it maximizes the potential for cost savings through competitive bidding and encourages a wider range of innovative solutions.

Public Impact

The primary beneficiaries are the U.S. Census Bureau, which receives essential advertising support for its operations and data collection efforts. The services delivered include advertising and promotional campaigns aimed at increasing public awareness and participation in Census activities. The geographic impact is nationwide, as Census Bureau operations and outreach efforts cover all states and territories. Workforce implications may include job creation within Young & Rubicam and its subcontractors, as well as potential indirect impacts on industries reliant on Census data.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the Time and Materials contract type if not closely managed.
Ensuring the effectiveness and reach of advertising campaigns across diverse demographics requires continuous evaluation.
Dependence on a single large contractor for critical outreach functions could pose a risk if performance falters.

Positive Signals

Awarded through full and open competition, suggesting a competitive pricing environment.
The substantial contract value indicates the government's commitment to effective public outreach for the Census.
Young & Rubicam's selection implies a level of trust and proven capability in handling large-scale advertising.

Sector Analysis

The advertising industry is a dynamic sector encompassing a wide range of services from creative development to media buying. Government contracts for advertising are crucial for public awareness campaigns, recruitment, and information dissemination. The U.S. Census Bureau's need for extensive outreach places this contract within the high-value segment of the advertising market. Comparable spending benchmarks are difficult to ascertain without detailed task orders, but the scale suggests it is a significant award within the federal advertising procurement landscape.

Small Business Impact

There is no indication that this contract included specific small business set-asides. As a large prime contract awarded to a major advertising firm, the primary impact on small businesses would likely be through subcontracting opportunities. The extent to which Young & Rubicam LLC engages small businesses as subcontractors will determine the direct benefit to the small business ecosystem. Further investigation into subcontracting plans would be necessary to fully assess this impact.

Oversight & Accountability

Oversight for this contract would primarily reside with the U.S. Census Bureau's contracting officers and program managers. They are responsible for monitoring performance, ensuring compliance with contract terms, and approving payments. Transparency is facilitated through public contract databases, although detailed performance metrics and specific task order costs may not always be fully public. Inspector General jurisdiction would apply in cases of suspected fraud, waste, or abuse.

Related Government Programs

U.S. Census Bureau Operations
Federal Public Information Campaigns
Government Advertising Services
Marketing and Public Relations Contracts

Risk Flags

Potential for cost overruns due to Time and Materials contract type.
Concentrated performance risk with a single large contractor.
Need for diligent oversight to ensure value for money.

Frequently Asked Questions

What is this federal contract paying for?

Department of Commerce awarded $404.5 million to YOUNG & RUBICAM LLC. AWARD OF OR 015 UNDER 2020 ICC IGF::OT::IGF

Who is the contractor on this award?

The obligated recipient is YOUNG & RUBICAM LLC.

Which agency awarded this contract?

Awarding agency: Department of Commerce (U.S. Census Bureau).

What is the total obligated amount?

The obligated amount is $404.5 million.

What is the period of performance?

Start: 2018-11-21. End: 2021-03-31.

What is the historical spending pattern for advertising services by the U.S. Census Bureau?

Analyzing historical spending patterns for advertising by the U.S. Census Bureau is crucial for understanding the context of this $404 million award. While specific historical data for this contract is not provided, the Census Bureau undertakes significant advertising efforts, particularly around decennial census years. These campaigns aim to ensure accurate population counts and require substantial investment in media outreach, public relations, and creative development. Past census cycles have seen multi-million dollar advertising budgets. Understanding the trend of these expenditures over time, including the types of services procured and the contractors involved, can help benchmark the current award's scale and identify any significant shifts in strategy or cost.

How does the pricing structure (Time and Materials) compare to other federal advertising contracts?

The Time and Materials (T&M) contract type used for this $404 million award allows for flexibility by reimbursing the contractor for direct labor hours at specified rates and for actual material costs. While common for services where the scope is not fully defined at the outset, T&M contracts can pose a higher risk of cost overruns if not meticulously managed. Compared to fixed-price contracts, which offer greater cost certainty for the government, T&M requires robust oversight to ensure labor hours and rates are reasonable and necessary. Many federal advertising contracts, especially for well-defined campaigns, might utilize fixed-price structures. The choice of T&M here suggests a need for adaptability in the advertising efforts for the Census Bureau, but it necessitates stringent monitoring by the agency to control costs and ensure value for taxpayer money.

What is Young & Rubicam LLC's track record with federal government contracts, particularly in advertising?

Young & Rubicam LLC, as a significant player in the advertising industry, likely has a history of working with various clients, including potentially government entities. However, the provided data focuses on this specific $404 million award from the Department of Commerce for the U.S. Census Bureau. To assess their track record with federal contracts, a broader search of federal procurement databases (like SAM.gov or FPDS) would be necessary. This would reveal the extent of their past federal awards, the agencies they've served, the types of services rendered, and their performance history. A strong federal contracting history, marked by successful contract completions and positive performance reviews, would bolster confidence in their ability to deliver on this substantial Census Bureau contract. Conversely, any past issues or underperformance would be a point of concern.

What specific advertising services are included under this contract, and how are they measured for effectiveness?

The provided data indicates this is an award for 'Advertising Agencies' (NAICS code 541810) supporting the U.S. Census Bureau. Specific services typically encompass market research, campaign strategy development, creative content production (e.g., commercials, print ads, digital content), media planning and buying across various platforms (TV, radio, digital, social media), and public relations. Measuring effectiveness is critical and usually involves a combination of metrics. For the Census Bureau, key performance indicators (KPIs) would likely include reach and frequency of advertisements, public awareness levels (measured through surveys), website traffic, call center volume, and ultimately, participation rates in Census activities. The contract should outline specific deliverables and the metrics used to evaluate the success of each campaign element.

Are there any specific risks associated with awarding such a large advertising contract to a single entity?

Awarding a contract of this magnitude ($404 million) to a single entity, Young & Rubicam LLC, presents several potential risks. Firstly, there's a risk of vendor lock-in, where the government becomes heavily reliant on one contractor, potentially reducing leverage in future negotiations or limiting access to alternative solutions. Secondly, performance risk is concentrated; if the contractor underperforms, it could significantly disrupt the Census Bureau's outreach efforts, impacting data collection accuracy. Thirdly, while competition was full and open initially, the long duration (ending March 2021, implying a start around late 2018) means the government is committed for an extended period. Finally, the Time and Materials nature of the contract, as noted, requires diligent oversight to prevent cost creep. Mitigating these risks involves robust contract management, clear performance standards, regular reviews, and potentially contingency planning.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Advertising, Public Relations, and Related Services › Advertising Agencies

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › MANAGEMENT SUPPORT SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Pricing Type: TIME AND MATERIALS (Y)

Evaluated Preference: NONE

Contractor Details

Parent Company: WPP PLC

Address: 3 COLUMBUS CIR, NEW YORK, NY, 10019

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign-Owned and U.S.-Incorporated Business, Not Designated a Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $425,601,162

Exercised Options: $404,482,411

Current Obligation: $404,482,411

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: DOCYA132316CQ0003

IDV Type: IDC

Timeline