When Energizer Holdings Inc. put its Hispanic advertising account in review in 2002, two established shops made it to the final round: Zubi Advertising and Casanova Pendrill. A small, brand-new shop in Long Beach, Calif., Grupo Gallegos, had been asked for credentials but did not make it to the final stages of the review. Yet its CEO, John Gallegos, was not easily deterred. One Friday afternoon, as the other shops had their final pitches under development, he called Energizer's brand manager, Cedric McCants, and asked for the opportunity to pitch in the final round, promising not to miss any deadlines even though his agency would have less time than the other finalists. He was so positive that Grupo Gallegos would be the true fit for Energizer that he offered to pay for the copy testing of the work to be presented (a typical client cost) as a way of proving his commitment. The following week, Grupo Gallegos was in the finals, with no need to pay for the tests. The outcome of the diligent last-minute work, "Game" and "Japanese Hand," sold Energizer.
"Of any advertising spot that has ever been presented to me from any agency, 'Japanese Hand' is the storyboard I laughed the hardest at the first time I saw it," says Jeff Ziminski, vice president of marketing for Energizer.
The spot, in which a Hispanic man is unable to stop taking pictures after receiving a hand transplant from a Japanese man, was not only part of the winning pitch but conquered audiences and judges in advertising festivals worldwide. "Japanese Hand" won Grupo Gallegos its first Silver Lion at Cannes last year, plus a Silver Pencil at the London-based D&AD, considered one of the most selective awards. In addition, it won a Sol de Plata at the El Sol Festival in San Sebastián, Spain, and two more in Buenos Aires — a silver award at FIAP (Festival Iberoamericano de la Publicidad) and a gold award at El Ojo de Iberoamérica — among others.
"We had known from a prior involvement in the Hispanic market that John [Gallegos] was a very smart, energetic person, and ultimately the creative they presented to us was superior to the other agencies that we were evaluating," Ziminski recalls. "John's overall strategic input has influenced some of the things that we are doing in the general market, certainly the tone of the copy. We've gone back to more of a humorous and entertaining tone that really John led in the Hispanic market."
Besides adding luster to the shelves of its new office space with worldwide creative awards, Grupo Gallegos is filling its books and records with upper-two-digit growth in billings and revenue, which went up 91 percent in 2005. The agency had 14 new hires, closing the year with 54 staffers. Out of nine pitches, eight new brands were added to Grupo Gallegos' client roster: Mitsubishi Motors North America Inc, The Getty Center in Los Angeles, Absolut Spirits Company Inc., the California Milk Processor Board, Bally Total Fitness, Zales Jewelers, Petco Animal Supplies Inc. and The Home Depot. The synergy between strategic and creative capabilities, in addition to the shop's growth in 2005, makes Grupo Gallegos Hispanic Agency of the Year, as selected by Adweek sister publication Marketing y Medios.
THE ROAD TO AUTONOMY
John Gallegos wanted to delve into sports marketing when he graduated from the University of Southern California in Los Angeles in 1987. The son of Mexican immigrants from the central state of Zacatecas, he landed his first job as an account executive at Noble & Asociados in 1988, an L.A.-based advertising agency that was also one of the largest Hispanic shops in the country. That paved the way into advertising. From his early days in the business, he nurtured his core values: relationships built on trust and independence. "I am extremely competitive. I have a lot of energy, but I also have compassion," Gallegos says.
In a market increasingly driven by consolidation, John Gallegos has more than once said farewell to a shop as soon as a holding company came onboard. That was the reason he parted ways with Noble & Asociados, when the agency was partly acquired by D'Arcy Masius Benton & Bowles in 1994. The same thing happened with the next agency he joined, Casanova Pendrill in Costa Mesa, Calif. He climbed the ranks to become vice president and account director, but the agency was acquired by the Interpublic Group of Cos. in 2001. Wary of holding companies, Gallegos says he had always been first and foremost loyal to the people he worked with — be they peers or clients.
As a leader at The Home Depot's account at Casanova, Gallegos worked with Stan Richards, principal of Dallas-based The Richards Group, one of the largest independent general-market agencies in the country, with billings of $950 million in 2005. Aware of the ever-growing role of the Hispanic segment in the marketing and advertising landscape, Richards found in Gallegos the right partner to collaborate with in the Hispanic market. That was how he became a minority investor in Grupo Gallegos when the agency launched in July 2001. "It was the first time that an independent agency took a stake in a Hispanic advertising agency," Gallegos recalls. "It is usually a network or a holding company that does that."
Stan Richards has had an eagle-eyed view of Grupo Gallegos' evolution since its launch. "It has gotten a lot bigger, because it started from zero and has provided outstanding work for several of The Richards Group's clients when we were able to work together. Additionally, it has attracted the attention of a number of clients outside of The Richards Group," he says.
Besides his minority partner, Gallegos equipped his new venture with people he handpicked. "Most of these people had worked with me before," he says. The Gallegos-Richards connection came in handy to get the agency's first clients: PrimeCo (now US Cellular Corp.) and Pep Boys. Size would not prevent Gallegos and his team from chasing the market's most-coveted accounts. "It is our five against your best five," Gallegos says, alluding to big shops assigning their best people to an important pitch, with full confidence that his management staff of five is always tops. Then and today, they are: Favio Ucedo, principal and creative director; Esther Soto-Schwartz, principal and director of account planning; Ken Deutsch, principal and media director; Maria Maldini, account supervisor/office manager, who first worked with Gallegos as his assistant at Noble & Asociados in 1993; and, naturally, John Gallegos.
"Coming to work with John at the agency was not a question, it was a given," Maldini says. Today, out of the 54 professionals on Grupo Gallegos' staff, 12 have a prior working relationship with the founder. "I believe Favio is as good as there is in creative, Esther is as good as there is in planning and Ken is as good as there is in media," Gallegos says. "When there is a good relationship, the work tends to be better because of trust."
Peers in the industry also recognize and place high expectations on the Grupo Gallegos team. "Each adds different things to the mix," says Alex Pallete, vice president and director of account planning for New York-based The Vidal Partnership, Marketing y Medios' 2004 agency of the year. "They are going to help put the West Coast back to where it was in the Hispanic market."
Richards also points out the shop's efficacy. "The work has been consistently outstanding. If I look at the work, which has Favio's imprint over the last couple of years, I believe it is the best in the category," he says.
EMBRACING THE NONTRADITIONAL
The upcoming campaign for the California Milk Processor Board (CMPB), a production that came close to $1 million, will include three TV spots, shot in Buenos Aires in November. They are the result of a strategy pitched to the CMPB during last year's review, which concluded in May.
CMPB had worked for more than 10 years with Santa Monica, Calif.-based agency Anita Santiago using the tagline "Familia, amor y leche" (Family, love and milk). Grupo Gallegos' plan for the brand is more in line with the famous general-market strategy that coined the perennial "Got Milk" tagline, Gallegos says. The new campaign, which breaks in late January, focuses on the health benefits milk yields, such as teeth, hair and muscle flexibility; and broader topics for all drinkers rather than the mothers targeted in the previous campaign.
"They brought a new way of looking at a commodity like milk," says Steve James, chairman of CMPB. "[We needed] a fresh way of getting the consumer to look at milk, and there was something about Grupo Gallegos that really set them apart." Perhaps it was the shop's use of athletes and acrobats to tell the story.
A broader outlook worked for Grupo Gallegos when pitching for The Home Depot's Hispanic full-service account in late 2004. Participating agencies were asked to develop a marketing plan for the store's line of paints, given that, according to research carried by the client, painting is the number-one home-improvement project among Hispanics. Instead of diving deep into insights for a traditional advertising campaign, Grupo Gallegos' planning department took a step back and looked at how Hispanics relate to colors. Planners found that Latinos appreciate talking about color with more idiomatic Spanish touches, using references that bring images to mind such as "verde botella" or "verde tortuga," instead of, say, the not-too-targeted translation of a "mesclun green."
Centered on that idea, Grupo Gallegos proposed starting with a new line of paints even before developing the advertising campaign. That led to Colores Orígenes, which included renaming the color palettes, point of sale, merchandising materials, packaging, and print and TV advertising. The Home Depot declined to comment for this article, but the company did hire Grupo Gallegos to execute the project, except for media buying, which was conducted by the brand's Hispanic agency of record, The Vidal Partnership. "People at The Home Depot spoke very highly of John [Gallegos] at the time he was at Casanova," says Vidal partner Tony Ruiz.
Now an account planner at Grupo Gallegos, Ken Muench had participated in The Home Depot's pitch while working as a creative for Casanova Pendrill, which also made it to the finals. After 10 years as a creative in the Hispanic market, Muench, a native of Mexico, was going through a sort of early mid-career crisis, which made him contemplate a transition into account planning. Sound creative, he thought, could be rooted only in serious planning. "I am talking about an approach that is media-neutral," he says. In his experience, Muench says, the core ideas for most campaigns are generated with a predetermined plan for the media that will be used in the campaign.
When Muench learned about Colores Orígenes last summer, he invited his former Casanova coworker John Gallegos for lunch. "John told me enough to say that his wasn't a conventional agency," he recalls. After a four-hour chat, Muench was convinced about transitioning into account planning, and last summer he took a job at Grupo Gallegos. Now, the former creative doesn't waste opportunities to gather insights about consumers. For client Tecate, the popular Mexican beer, Muench planned a field trip to Pico Rivera, Calif., 14 miles east of Grupo Gallegos' offices, for a "charreada," or Mexican rodeo, on a Sunday in October, and invited the account executive and the creative on the account to join him. To his surprise, they followed and listened to Los Tucanes de Tijuana, a popular regional Mexican band. From 4 p.m. to midnight, they had enough time "to get drunk with the consumer," he recalls.
With a strong research background, Esther Soto-Schwartz, the head of the planning and research department, encourages nontraditional approaches to their activities. "We've never been the kind of agency that researches things to death," she says.
With that in mind, Muench is not intimidated to take a digital camera and interview people on the street about subjects that could lead to insights that will inspire creatives. In his first year as a planner, Muench says he is excited about his new learning curve, and part of it has to do with training opportunities. He says he has already discussed with Gallegos what conferences he would like to attend this year.
When it comes to training, all staffers seem to benefit. Veteran account executive Montse Barrena says that she came out of an in-office presentation skills workshop invigorated with new ideas. A professional coach divided the staff into groups of five, with workers instructed not to participate with their direct supervisors so that they would not feel intimidated. The presentations were recorded. They watched themselves afterward and noticed where to improve. "Some of the points discussed were how to make eye contact, how to get people's attention when they seem not to be interested," Barrena says.
Yet, even staffers realize there is always room for professional improvement. As the agency grows, they recognize there are areas where they could do better work. For some, including Gallegos himself, the agency should promote itself better. Ucedo, for his part, thinks the team should improve its work on the Internet.
In the meantime, the team gets closer at social gatherings. It is not uncommon for Gallegos to take staffers for happy hour on a Friday afternoon. Last summer, he took them on a boat trip during a regular workday.
But Gallegos also makes sure that he gets to know his staff one-on-one. Every month, he takes one of his employees to lunch where they can talk about anything. "I don't want people to think that they can't grow because they don't have access to John Gallegos," he says. "I believe there isn't anything that we can't accomplish."