Direct Marketing Agency Triumphs Over ‘Mad Men’
“Wonder Who?” was not an unusual “Mad Men” reaction in 1960s when direct marketing agency Wunderman, Ricotta & Kline, already at the top of the direct mail and mail order agency league table, might be mentioned in a social or business conversation. “What do they do?” was the usual semi-curious follow-up, if there was one.
In the sacred haunts of ad men (there were precious few women, but more on that later), the direct and data-driven marketing discipline just didn’t have the sex appeal that came with real advertising; especially real advertising that could be seen on television and bragged about over cocktails. It was an exciting world, where 30 seconds of peer-acclaimed, but unaccountable, genius had far more value than judgments based on the measurable and accountable return on marketing investment.
That we now live in a very different world could not be better illustrated than by the recent announcement that WPP has folded 150-year-old J. Walter Thompson, the citadel of “brand” advertising, into Wunderman, described by Adweek as “the first direct marketing agency” and “the darling of WPP.” The result will be Wunderman Thompson, with 20,000 people across 90 markets.
Wrote Avi Dean in Forbes:
“This comes a couple of months after digital agency VML merged with traditional agency Y&R to form VMLY&R. While these are positioned as mergers of equals, they are essentially a takeover by the digital agencies of their older siblings.
“JWT’s demise is a metaphor of the demise of Madison Avenue.”
The ironies are too numerous to mention.
There must, incidentally, have been a compelling reason for the WPP management’s recent pairing of VML with Y&R to form VMLY&R. Could it have been that folding Y&R into Wunderman after Wunderman had been previously folded into Y&R might have been too much even for the traditional “Mad Men” to stomach?
The “demise of Madison Avenue” can be traced directly to the cultural clash between traditional agencies and their owners who looked down their noses at “mail order” and what became data-driven direct marketing. From the earliest days of the agency, its founder, Lester Wunderman, while optimistic, maintained a healthy skepticism about whether the chasm between these two cultures could truly be breached, given the opportunistic motivation driving most “mergers” of the disciplines.
In the early 1970s, when general agencies realized they needed to be seen to embrace direct marketing, Wunderman was acquired by Young & Rubicam. The embrace, however, spun to clients and the marketing world, was less driven by passion and an honest and sensitive understanding of the changes that were impacting the market than giving clients some comfort if, God forbid, they wanted some DM advice or service. There was — and to a lesser extent, still is — a historical incompatibility of two cultural systems.
The traditionalists mostly considered DM practitioners, if not second-class citizens, not to be the folk you would want to bring to a top client meeting — unless you had to. For those of us who experienced the “had to,” how the “essential” half-hour direct marketing portion of the big client presentation got reduced to 15 minutes and then to five (if there was still time before the client left to catch his plane), however demeaning, made our subsidiary status perfectly clear.
When Wunderman proclaimed that “Data is an expense. Knowledge is a bargain,” most of the traditional advertising world nodded their heads but didn’t quite get the “knowledge” part, or see how it would impact the future of every aspect of marketing. Writing about this future in the last chapter of his 1996 book, “Being Direct: Making Advertising Pay,” Wunderman said:
“The way of creating effective combinations of price and service is by creating knowledge-based direct channels between manufacturers and consumers, in which the media becomes the marketplace. The Industrial Revolution created the practice of branding, but in the Information Age, brand images increasingly provide only a thin shield against competition.”
The ever-expanding “knowledge” of the consumer and the market, made possible by the handling of data and of the accountable value of every advertising spend, are the forces that have propelled CMOs, as described by Avi Dean, to “care less about agency labels than ever before. They care about effectiveness and results.” So it’s hardly surprising that what we might call the “accountable” culture — making advertising pay — has overtaken the “image” culture. Or so it seems.
Because direct marketing had long been “down-market,” to quote an oft-used phrase, it attracted a disproportionate number of very talented women — many of whom knew they would never make it in the testosterone-dominated “advertising business.” Ironically, that’s all changed, as well, and two women have been appointed as “Chairman” (Chairperson? Chairwoman?) and CEO of Wunderman Thomson.
Some veterans of this culture war still insist that “brand” and “accountability” are, if not incompatible, not happily married, either. They mourn the loss of JWT and fear for the clients.
Quoted in the UK’s Campaign, Rosalind Gravatt, former director of communications, Lloyds Banking Group, said:
“I believe that the JWT brand name could have evolved and still has huge cachet (particularly among blue chip clients) in a way that the Wunderman name never will.”
Lindsey Clay, CEO of Thinkbox, was more emotional:
“It feels to me like someone I care about has died … I just hope that the brand guardianship and culture-defining creativity, which were central to the JWT ethos, live on beyond the name.
The loyalty to JWT is admirable, but the premise that brands will lose cachet and suffer when tainted by the Wunderman name and/or accountability, is a remnant of another age.
“Wonder Who?” is a question that isn’t asked anymore. What goes around comes around.
[Author’s Note: As the founder and first CEO of Wunderman Worldwide, the international arm of the original Wunderman company, and after the Y&R merger, the Wunderman member of the Y&R International Board, I’ve been privileged to have had a unique, if slightly prejudiced, view of the changes described above.]
Peter J. Rosenwald is an expat American living and working in Brazil; founder and first CEO of Wunderman Worldwide, International Division of Wunderman agency) and first chairman of Saatchi & Saatchi Direct Worldwide; strategist and senior executive in charge of building subscription and data-driven marketing for Editora Abril, Latin America's leading magazine publisher; founder of Consult Partners, active strategic marketing consultancy working in Brazil, U.S. and U.K. International keynote speaker on data-driven marketing and author of "Accountable Marketing" (Thomson), "Profiting From the Magic of Marketing Metrics" (Direct Marketing IQ), and "GringoView" blog author for Brazilian Huffington Post. With an international perspective, my blog's purpose is to share my maverick views of this business I've spent the last half-century working in, enjoying and observing.