Compaq is the bigger advertiser of the two companies, spending a reported $350m (£241.6m) on global advertising. In December 1999, HP launched a $200m (£138.1m) global branding effort, but it spends a relatively small amount on product advertising.
However, as both Compaq and HP struggle in the shrinking PC market, it seems unlikely that the merged company will be putting out the grand prize of a $550m (£379.7m) global ad account when the merger takes place in the first half of 2002.
Martin Jones, director of advertising at the AAR, said, "In this case, the merger seems to be driven by cost savings, so one would assume that consolidation will be high on the agenda."
The Interpublic Group of Company's FCB stands to lose the most, should the merged company decide to consolidate its advertising with another agency. It only picked up Compaq's worldwide creative account just over a year ago -- it is handled in the UK by Banks Hoggins O'Shea/FCB.
As is often the case, the larger partner will likely end up in the driving seat. If this is so, then it will be HP calling the shots, which would put HP's agencies in a stronger position.
On the HP side, the work is handled globally by Publicis and Saatchi & Saatchi, with US agency Goodby, Silverstein & Partners retained for corporate branding work. None of the agencies were available for comment.
IBM, which will be the merged HP/Compaq's biggest rival, is itself something of a pioneer in the global advertising field when it comes to consolidation. The computer giant undertook a review of its ad agencies in 1994 and awarded its $500m (£344.9m) global account to Ogilvy & Mather.
More recently, IBM has taken the process a step further, announcing last month that it was consolidating its PR into two global networks, and awarding its entire direct marketing and interactive work into WPP Group.
One of the winning groups in PR was Omnicom, which is forming a special coalition called One Blue, using three of its PR agencies -- Ketchum, Fleishman-Hillard and Brodeur Worldwide. The other winner was the smaller London-based agency Text 100, which has picked up the product side of IBM's business.
In the case of its direct marketing and interactive accounts, the work was awarded to OgilvyOne and Wunderman, with the casualty being the Havas Advertising-owned Brann. The move put all of IBM's advertising, direct marketing and interactive work within a single marketing services conglomerate. A move which brings with it certain much-sought-after cost savings.