DALLAS While being part of a holding company can help agencies offer more services and play on a larger stage, Richards Group founder Stan Richards believes going it alone is still the best path to follow.
"I can't give an example where the work got better when an agency was sold," said Richards on Tuesday at the American Advertising Federation's conference in Dallas. "If we're going to be true to our mission of continuing to do better work, then selling an agency wouldn't be a step in that direction."
Richards, whose Dallas-based agency is among the nation's largest independents, said nearly every holding company has approached him with preliminary offers. "We're very careful to explain we are not for sale, not now, not ever."
Participants applauded when he gave another reason for his stubbornness: "Only I would benefit if I sold the agency; everyone else, the clients and the people, would be disadvantaged."
Bringing a different perspective to the panel discussion was Bill Fogarty, a principal of Fogarty Klein Monroe in Houston. Fogarty sold his shop to Lois USA in 1997, buying it back two years later when Lois became financially troubled. "Even though I'm sure no agency has ever been sold where it wasn't agreed [the buyers] would maintain the people and the culture, that ain't the way it works," he said.
Valerie Moore, executive director of strategic resources at Interpublic Group's TM Advertising (formerly Temerlin McClain) in Irving, Texas, had a different point of view. She extolled the benefits of having the broad resources of a global network. But while Moore said IPG does not impact the day-to-day operations of the shop, there is a "significant impact" in the broader sense. "They make the decision about who leads the creative product for the agency, and in that case they completely affect it," she said.
A subsequent discussion revolved around music's role in advertising and panelists indicated recent trends in the recording industry could benefit advertisers. "As the music business gets dominated by radio-station conglomerates, the artists are going to try to get around that and I promise you it's in advertising and marketing," said Paul Loomis, president and CEO of The Loomis Corp.'s Luminous Sound Studios in Dallas.
Murray Gaylord, vice president of brand marketing at Yahoo, took a slightly different angle. "The pressure is on with what's happening with music and downloading piracy and these artists are going to look for other income streams and it's in product placement," he said.
Later, top retailers discussed challenges they're facing, with media fragmentation among the top concerns. "The mass market is dead," said Home Depot executive vice president of merchandising and marketing John Costello. As a result, advertisers need to make sure they're providing a consistent message through all aspects of customer communication, including in the stores, he said.
The four-day conference concluded with a presentation by DDB Worldwide chairman and CEO Keith Reinhard about his Business for Diplomatic Action group, which aims to improve the negative image of the United States abroad by "replacing passive dismay with energetic positive action," he said.
Reinhard said the perceptions abroad that America is an arrogant country obsessed with hyper-consumerism are related more to business than to government. He challenged companies to step forward to reverse that mind-set.
Among the actions he said businesses can take: Simply being sensitive to the issue and the implications that anti-Americanism can have on brands and by influencing public policy. "We're hoping to get a few leaders to step forward to support the issue," he said.