Publicis Deal Expected to Increase Opportunities
CHICAGO-The influence of African Americans on young consumers the world over is not lost on Maurice L vy, worldwide chairman and chief executive officer of Paris-based Publicis S.A.
L vy said Burrell Communications Group's knowledge of the black market makes the Chicago agency an attractive addition to the Publicis empire. Publicis last week acquired a 49 percent stake in Burrell, which had been looking for such a buyer for about nine months.
"Some trends-in sports, fashion, music, dance-are born in the black community," L vy said. "If one can read that in advance, one can take great advantage in a large, mainstream youth market."
Tom Burrell, chairman and chief executive officer of the shop he founded in 1971, agreed that a working knowledge of the African American market can drive marketing even outside the U.S., and in countries with small black populations.
"Much of what we do here in the U.S. is readily applicable to other markets," Burrell said. "Anywhere you go in the world-Paris, Japan-all the developed countries are really looking to South Central (Los Angeles), Harlem, the south side of Chicago, this basement where the furnace is being stoked."
The deal should open up a world of opportunity for Burrell, said Ken Smikle, president of Chicago-based Target Market News, an African American market research firm.
"What this hopefully does is give access to the African American agency that they have been denied for so long," Smikle said. "We are more of a niche market world than a mass market world, [so] one would think these agencies would have an edge in the future."
Burrell is reportedly the largest African American target agency in the country, with claimed billings of $166 million. Not far behind is Uniworld, New York, which is said to be in talks with Young & Rubicam, which is looking to fill a niche in its minority portfolio, which already includes the Bravo Group (Hispanic) and Kang & Lee (Asian American).
"The whole concept of African American- and minority-targeted marketing has gotten to a point where it's very desired and sought after by the major ad agency companies," Burrell said. "If you want to grow your company, you have to play in that arena."
Burrell said capital from the deal will be used to fuel domestic growth. While the agency has done well in picking up relatively small portions of the huge budgets of blue-chip clients such as McDonald's, Procter & Gamble and Coca-Cola, Burrell said smaller clients could benefit from hiring the agency as their general market shop-suggesting companies these days need shops skilled at targeted and segmented marketing.
"Mass marketing is as dead as a doornail," he said. "To be the biggest African American agency is perhaps a specious distinction. We're a major advertising agency; we feel we're among the best."
Burrell had enlisted AdMedia Partners in its search for a buyer. The agency, with majority ownership still in the hands of Burrell and top executives, will keep its name. The deal with Publicis includes Burrell's Atlanta office, but not Burrell Yagnick Relationship Marketing in New York.
L vy said he expects to add a Hispanic target agency to his portfolio at some point, as part of his continuing effort to beef up Publicis' U.S. presence. Last year the company acquired Hal Riney & Partners, now Publicis & Hal Riney.
"If we want to go against some strong global players, we have to have in the U.S. a full range of services," L vy said.