NEW YORK Clemmow Hornby Inge & Partners' co-founder Johnny Hornby wants to make it clear he's not "launching" a U.S. agency—at least not yet.
But the London shop's founding client, The Carphone Warehouse, needs advertising for a joint venture with Best Buy called Best Buy Mobile, so a small team will arrive here in a few months.
The six-year-old shop, known for its new-business acumen and integrated offering, in mid-April sold a 49.9 percent stake to WPP Group after being wooed by four holding companies. The estimated $59 million up front cash deal for an agency with revenue of about $36 million and a staff of 182 was atypical for WPP, which tends to buy agencies outright.
But CEO Martin Sorrell wanted CHI enough to interrupt a vacation on April 1 to start talks with Hornby at London's Heathrow Airport—a brief encounter that impressed Hornby and marked the beginning of the end of his negotiations with Havas.
The 40-year-old ex-TBWA\London exec last week discussed the deal, dipping his toes in the U.S. market and what it's like to be the younger brother of world-famous author Nick Hornby.
Q: Why WPP over Havas?
A: Havas is a group on the up. And I'm sure that Vincent Bolloré, Fernando Rodés Villa and David Jones will make a lot out of Havas. From our perspective, we were looking to partner with somebody who could help us both in terms of international expansion and media, particularly in media buying. So, without being rude to Havas, because they're a fantastic, great organization, they are not probably in that same league, particularly on the media side, yet. So in that sense, it became a no-brainer.
Martin took time out of his vacation to meet you at Heathrow. How did that effort influence your decision?
His ability to do something once he sets his mind on doing it is really impressive. ... His decisiveness is pretty impressive.
How important was it to do a minority stake deal and how did you get Martin to agree to that? It's pretty unusual for WPP.
The minority stake [was] vital from our perspective [with] whoever we found as a partner because we love our agency and we want it to be our agency forever. We've also diluted our equity and shared it with the next level of management—about 25 people within the agency-and I want to perpetuate that. It's a deal that [Bartle Bogle Hegarty CEO] Nigel Bogle did very similarly with Publicis and he was kind enough to send it to me. So I can't pretend to be the architect of the deal. I just know that he'd done it and I kind of stole the idea. And we were very resolute that that's what we wanted to do. What were the conversations with Dentsu and Omnicom like and how far along did they get? Not very far.
Does your desire to come here stem from Carphone Warehouse and their connection to Best Buy?
Yes, and I really want to be careful about that, actually. We're going to come to New York for Best Buy and Carphone Warehouse. I don't think we're coming to New York saying, "We're opening an agency" yet. We're just going to come and help Best Buy and The Carphone Warehouse do what they're doing in New York and a few other places around the U.S. And that's it for now. Then we'll see how it goes. I think we've seen enough English agencies that think coming to New York is easy and I think history says it's pretty hard. And we probably wouldn't end up launching a U.S. agency without some very significant Americans in it.
Did Nigel have any specific advice about expanding?
BBH is probably the best agency in the world. And they now have a very good office, to my understanding, in New York. But it has taken a long time. So if it takes the best agency in the world that long to get a good office in New York, I'm not going to underestimate the scale of the task.
What U.S. agencies do you admire?
Wieden [+ Kennedy]—the quality of the creative. Goodby [Silverstein & Partners], I really admire the way they have managed to adapt from being a kind of old-school creative agency to a new digital-ready creative agency, which I think is amazing. And Crispin [Porter + Bogusky] has clearly taken the world by storm. Everyone would love to think they have fallen apart, but I don't see any evidence of it. They look pretty good to me.
How would you describe your leadership style?
Lacking, shambolic [laughs]—is that a good leadership style?
What other markets interest you?
We're going to follow our clients where they ask us to be, rather than be arrogant enough to think that there are markets that want us. That's my view of the U.S. I don't think New York necessarily needs another creative agency. And I'm sure other markets around the world don't need one either. But I think where we have great relationships with our clients, have brilliant ideas, gel with them to provide great creative solutions and they want us to come and work with them, then we can build something. And then if something as a result emanates from that, then fantastic.
You come from a very successful family. How much does that contribute to your drive to succeed?
What, being the least talented member of a very successful family? Having a tenth of the talent of my older brother and turning up at home at Christmas saying, "I've made some commercials" when he has made About a Boy has in no way affected me adversely [laughs].
What are Martin's expectations of you?
I would hope he would think us to be a fresh and exciting agency in London that does things differently and [can] replicate that in other countries.
Who are you mentors?
Charles Dunstone, founder of The Carphone Warehouse. I have had quite a lot of involvement over the years in political advertising in the U.K. So, Peter Mandelson. He was a client of ours and I did the advertising campaign for Tony Blair in 1997 and Mandelson was his main strategic communications advisor. I learned a lot from them. And I learned a lot from the people I worked for: Carl Johnson and my partner, Simon Clemmow. Because Carl and Simon hired me at TBWA.
They're to blame.
They have a lot to answer for, haven't they?
How would you describe CHI's culture?
It's very ideas and strategically led. Every agency likes to think it's creative. But we start very much from trying to imagine our clients' businesses and be entrepreneurial about our clients' businesses. Maybe that's because Charles is our founding client and he started his own business. And we've worked on 48 businesses with him. We did a campaign for Talk Talk and I think the third most-downloaded ad on YouTube in the U.S. was the ad we did for Talk Talk. We did that last year. Charles has made us think entrepreneurially. And a lot of our clients we helped invent. Britain's most successful credit card, Britain's fastest-growing telephone brand, fastest-growing mortgage company. A lot of the clients that we'd end up getting—maybe because of the way we worked with Charles—they'd come along and say, "Help us invent the brand, help us do the design and help us launch it and make it happen." Rather than, maybe at other agencies, where you go, here's a really long-running fantastic brand that has been around for a few years. We've got a few of those, but a lot of our success comes from launching brand-new brands. So the way we try and get our people to think is, if you were starting this, what would you call it? How would you present it to consumers? How can you make it different? We try and keep it kind of high level, which makes the culture sometimes challenging because we want all our people thinking at that level rather than just give them a nice
People describe your agency as a very successful business (entrepreneurial, everything under one roof, very connected), but they don't necessarily give you high marks for your creative. How do you respond to that?
Two ways. On the one hand, we never set out to be a creative boutique. So I've never wanted to win awards for curling in type, D&AD. On the other hand, if you had said to me that after three years we'd have been in the Gunn Report's top 20 agencies, that we'd won 11 golds and silvers at Cannes and we were British television advertising agency of the year, I'd go, "That's pretty good." As an agency becomes spectacularly successful in one dimension, people need to find a reason why there's something wrong with it. So maybe our business growth and our business success and our kind of entrepreneurial focus has been at the forefront. ... The one fair criticism of us is we have produced a lot of good work for a lot of clients, but we haven't done—which I think Wieden and Fallon have done better than us in London—is to have a commercial. We haven't done the Sony "Balls" and we haven't done the Honda "Cog."
How many people will you need to do The Carphone Warehouse assignment here and what types of people?
We'll probably only have seven or eight people in the U.S. and six or seven coming out to visit. There will be a whole mix of people. We've got designers, retail specialists, direct marketing people, e-marketing people, planners and media strategists all in our agency. It's probably not vastly different from what Carl Johnson is doing with Anomaly, but we've built up our agency to say we really didn't want it to be an ad agency in that sense. So of the 182 people we have, 70 of them come from disciplines outside of advertising. We'll aim to replicate that in the U.S., only because that's what's required. What we'll be doing with Best Buy will be in part advertising, but in part design, and in part retailing, direct marketing, account strategy, et cetera. It's a joint venture. It's called Best Buy Mobile.
What are the biggest differences between the U.K. and U.S. markets?
The scale is one thing. And there are clearly differences between consumers.
... You have to create a hybrid of U.K. and American talent to operate in America, rather than just saying you can do it with U.K. or European talent. We don't have that yet.