}

Tuesday, October 20, 2015

A Brief Look At How Agencies Headquartered Elsewhere Can Do Well In New York City



Let’s face it, New York City is the advertising capital of the country, if not the world.  While there are wonderful agencies that do fabulous work all over the country, in this day and age of computers, Skype, Go-To-Meeting, FaceTime and other electronic wizardry one can do business anywhere, except, possibly, New York.

Looking back historically, few agencies headquartered in other cities have done well here unless they buy an established New York shop or move their headquarters here.

N.W. Ayer was one of America’s oldest and largest advertising agencies. It was established in 1869 and by the early 1970’s, it had achieved number ten or 14 in size (depending on sources), but it was located in Philadelphia. It closed in Philly and opened in NY in 1974 and then achieved number six in size.  But that growth required both a change in headquarters and the purchase of Cunningham & Walsh, a major NY Procter agency. (N.W. Ayer was eventually bought by and merged into DMB&B, which subsequently became part of Publicis).

Most people don’t realize that Publicis existed in New York for years.  It was mostly, as I recall, a small business to business agency. Then it purchased The Bloom Agency in 1993.  Bloom was a mainstay in Dallas, run by a legendary Texas adman, Sam Bloom. His son, Bob, inherited the agency and purchased a successful New York creative agency, Mathieu, Gerfen & Bresner in 1982 (I am abbreviating history for the sake of brevity). This enabled Publicis to establish a real New York presence once it purchased The Bloom Agency. The purchase of Bloom, followed shortly by the purchase of Saatchi & Saatchi and propelled Publicis into the giant it is today.

Hill Holliday, headquartered in Boston, tried for years to achieve major success in New York, but never achieved mass, despite hiring fabulous talent and, at one point, having the Revlon business in NYC.   When they purchased a New York Shop, Altschiller & Reitzfeld, it finally achieved success and critical mass here.

Chiat/Day, started in L.A. Once Jay Chiat opened the New York office and, after a short time, moved here himself in the mid-eighties. New York actually did well here.   After Chiat’s win of Nissan and their success with Apple in Los Angeles, the New York office was always eclipsed by L.A., despite Jay Chiat’s presence here (he was frequently out on the west coast). Even today, so strong was the brand that, TBWA/Chiat Day is mostly referred to, especially in L.A, as Chiat.

Arnold Worldwide, a Boston powerhouse, had to buy Jordan, McGrath in New York before really establishing a presence in New York City.

Leo Burnett, Wieden + Kennedy and a host of others have all opened branches in New York, often initially to facilitate television production here.  Most of these agencies have an anchor account in New York,  but their New York offices have never achieved the growth that I believe they should have or that they were expecting from their presence here.

Why is this?  Advertisers who want a New York agency, want to be where the principals of that agency are.  If they are located in another market, what is the sense in choosing their New York shop when they could almost as easily hire the headquarters agency? Jay Chiat realized that when he moved to New York.

To illustrate my point, before buying Altschiller, Jack Connors hired fabulous people to run his NYC outpost, but the agency never achieved real size on its own.   Buying an existing agency with well-known principals, allowed HHCC (Hill Holliday) to achieve success in New York.  

Ironically, some New York based agencies like DDB, Ogilvy, BBDO have succeeded in other cities, particularly Chicago, but agencies from those cities have not been able to grow and continually attract new business here in New York; the best example is Leo Burnett, the quintessential Chicago agency.

The advertising landscape is littered with agencies that have been successful elsewhere but which have either faltered in New York or closed because they could not attract enough business or lost too much money.  

On the other hand, the Brits have had some luck in New York – BBH and Mother are good examples. .  But I believe that is a different situation.  Americans seem to have a love affair with London advertising and things British do well here (although many have failed here).   But American’s don’t really have a love affair with Chicago or Portland or Dallas advertising.

1 comment:

  1. I can't understand why ad agencies in Los Angeles are considered to be almost second rate. Is it because by comparison, the work doesn't have an iconic feel, or a sense by clients that we'll fall short? We are a small shop, so I can understand the skepticism client's have toward dark horse agencies, but seldom do LA agencies embarrass ourselves. Just a thought.

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