Big Shops are Bad Business.

Rick Stanton, Creative Director / Managing Partner, Stanton & Everybody

A few years ago, a rather large advertising conglomerate with an outpost in Seattle actually made a run at my small but good shop.
Among other things, they were looking for a more senior, experienced presence leading their creative department. Looking around, I assumed they meant me.
After many secret breakfast meetings I was told a merger wouldn’t work.
The reason? We didn’t show a minimum 20% net profitability on each account.
It didn’t matter that we were profitable.
The logic behind the reasoning?
I kid you not, this is what their CFO told me.
The principals back in New York had made some bad decisions in the mid-90’s and bought racehorses and cigarette boats, along with some other bad choices and jeopardized the holding company’s assets. As a result, the new parent leadership had strict commands from up high; only buy other companies that can show a net 20% profit on all their business.
And oh, by the way, you have to pay us 15% of your gross earnings for rights to use our name in Seattle.
Big shops exist for one reason; make money for the Mother Ship.
Charge for every breath you take thinking or talking about a client’s business.
Charge for copies, charge for toner, charge for paper clips and hire young people.
Young people don’t cost as much, you can beat them like dogs and all they want is a portfolio so they can escape to New York so they can get even more abused.
And for gawd’s sake, don’t let the creative department lose the account.
Vanilla is good.
If you ever needed proof of the last two sentences, read the article I’ve linked below.
Essentially, MillerCoors forced Interpublic Group of Companies to get Deutsch to resign from an assignment for Anheuser-Busch. Apparently Deutsch was preparing some attack ads based on the joint venture between U.S. Molson Coors and SAB Miller.
MillerCoors didn’t like that idea.
IGC owns Deutsch. They also own DraftFCB which, you guessed it, works on the MillerCoors account.
The MillerCoors account provides a considerably larger amount of billing.
Big shops do not work if you’re looking for independent, courageous thinking that leads to work with a point of view.
But they do if you like small portions of really expensive vanilla ice cream.
By the way, the bowl is extra.

Read this article: http://adage.com/agencynews/article?article_id=138338