This post is exerpted from original article posted on July 12, 2007 in Screen Magazine
By Dixon Galvez-Searle
We’ve all heard stories of the regional ad industry in trouble. Critics have seen large ad agencies changing, shrinking, adjusting to new business models and succumbing to client pressures. But there are also some significant success stories to celebrate, from large agencies regaining their footing to mid-size and small agencies growing at record rates.
There’s a saying in Chicago: if you don’t like the weather, wait 15 minutes. The same could be said of the client rosters of many of the city’s agencies. With chief marketing officers coming and going with record frequency, clients are more likely than ever to put their accounts into review. But as one door closes, another opens and the region could be poised to welcome a wave of new business.
While large-scale account losses like Kraft (JWT/Chicago), Wal-Mart (Bernstein-Rein, GSD&M), Cadillac (Leo Burnett Detroit), Hyundai (The Richards Group) and United Airlines (Fallon) dominate the headlines, many large shops have stepped up their new business efforts in order to replace lost billings. After all, a strong, centrally located agency still counts for plenty in the client world.
And although many large agencies have struggled in recent years, the same cannot be said for smaller shops, many of whom have experienced explosive growth. These nimble companies have seized the opportunity to establish strong relationships with clients and to fill the niches created by an increasingly fragmented marketing environment.
If one thing is certain, it’s that change is afoot and with change comes opportunity. That’s why the new business process is so important to ad agencies throughout the region. SCREEN spoke with a sampling of shops – large and small – about their new business efforts, their approach to winning clients and their track records over the last 12 months.
You Win Some, You Lose Some: DiMeo & Co. (Chicago)
As a longtime veteran of the local ad industry, DiMeo & Co. founder Bernie DiMeo has seen two decades worth of changes, as well as ups and downs at his own agency. He says the last 12 months at DiMeo & Co. constitute “a typical year,” with both wins and losses, but also notes a significant expansion of the agency’s PR business, especially with existing clients.
And although DiMeo enjoys a longtime relationship with certain clients, notably the Chicago Bulls, he says the urge to put accounts into review is greater than ever. “I think there’s a lack of loyalty on the part of clients and agencies,” he says, attributing this to bottom line pressures and the high turnover rates of chief marketing officers. “They’re looking for a quick fix.”
DiMeo has countered this uncertainty by building a diverse client roster, including a current slate of food clients. “I never wanted to be known for one particular industry and that’s what I point out to prospects,” he says. “We know our business, you know your business and that’s what makes it a good fit.”
What also makes it a good fit is the personal relationship between client and agency. DiMeo says these relationships can help weather the inevitable peaks and valleys in a company’s business, like the transition from championships to losing seasons with the Bulls. “When I meet somebody I know right away whether I like them,” he says. “If you like each other, you can make it work.”
ACCOUNT WINS: Chicago Transit Authority, Ditka Records, Medieval Times, Steel Parts Manufacturing, Galaxy Home Remodeling, Gordon Tech High School.
ACCOUNT LOSSES: Medieval Times, Galaxy Home Remodeling.
Discriminating Tastes: Euro RSCG (Chicago)
Some ad agencies treat new business as a percentage game. The more clients you go after, the more clients you’re likely to sign up. But the Chicago office of global ad agency Euro RSCG takes a much more concentrated approach to new business, pitching only for clients that it genuinely wants on its roster.
“I think part of the reason why the new business game becomes difficult is you go after every pitch that moves,” says Zain Raj, chief marketing officer for Euro RSCG Chicago. “The smarter agencies are wanting to go after clients that are specific to their experiences.”
Even when an agency’s work doesn’t line up directly with a potential client, Raj says he can take aspects of the work and draw parallels to win new business. He says skills from one category are often transferable to “associative” or “distantly related” categories. For example, he says Euro’s Sprint client gives the agency experience with not only the telecom industry, but also with retail and technology.
Raj also disputes the notion that Chicago is not a destination for clients, noting that, “some of the most creative and accountable advertising is coming out of Chicago.” He says the market has been misunderstood, however, and called on the advertising community to communicate the many positives coming out of the city.
ACCOUNT WINS: Barilla, firedog, Circuit City, Sprint (added B2B business), Raceline, Valspar, Cabot, Citibank (additional 25 percent), Humane Society of the United States.
ACCOUNT LOSSES: BreatheRight (due to company acquisition), Graco (due to agency consolidation).