Not Always Their Kind of Town

Lowe’s Demise Raises Questions of How to Cut It in Chicago
CHICAGO–Ammirati Puris Lintas jumped into the Chicago advertising market with great expectations in late 1997.
Less than three years later, the Chicago shop, which had to endure a takeover of its parent by The Lowe Group and subsequent name change, is shutting down in May. The shop opened to handle the $85 million Ameritech account, but had almost no success in new business. So when Ameritech said it was taking its account elsewhere, the agency moved out.
The fate of Lowe Lintas in Chicago suggests it’s not easy for an outside agency to become a formidable–or even viable–presence in the Chicago market. The shop’s lead executive is more blunt–he said the market is full.
“The world doesn’t need another advertising agency, and Chicago definitely doesn’t need another advertising agency,” said Brad Brinegar, soon to-be former president of Lowe Lintas here. “[Chicago] is really good at chewing them up and spitting them out.”
Brinegar’s assertion aside, Chicago remains a market some see as a plum waiting to be plucked.
Santa Monica, Calif.-based Rubin Postaer and Associates opened a Chicago office in December 1998 headed by three veterans of Publicis & Hal Riney, Chicago, and the shop has built a decent roster. Account man Bill Marks and creatives Bill Mericle and Paul Janus brought over the $10 million Gardenburger business from Riney and in July 1999 landed the $20 million Morningstar investment services account.
“The thing that’s worked for us is having a lot of connections, being rooted in Chicago ourselves,” Marks said. Those roots extend to the agency’s founders, Gerrold Rubin and Larry Postaer, who started their careers in Chicago.
Brinegar agreed that bringing in people from outside the market to launch an agency would be a mistake. A former Leo Burnett account director, Brineger concentrated on hiring those who knew Chicago, including creative heads Tim Kane and Jon Moore.
“People don’t like that [outside leadership] here,” Brinegar said. “Chicago is seen as a very different market than New York and some clients really like that difference and are really connected to it.”
Two years after opening a service office here, New York-based Deutsch is still sizing up Chicago for a possible expansion. Donny Deutsch, the agency’s chief executive officer, said at the time the service outpost opened that he expected a full-service operation would be running here within a year [Adweek, March 2, 1998]. Deutsch has since opened a Boston office and undertaken an expansion effort in London, but Chicago has yet to get beyond handling regional accounts.
“Chicago was opened as a service office and continues to be a service office,” said agency partner Peter Drakoulias. “It’s totally on the radar, but it’s not something where we have recruiters in the area looking for a director of client services.”
Industry observers said it was misguided for Lowe Lintas to try to launch a new shop with one client, in a market already swelling with heavy hitters.
New York-based BBDO’s office here, opened in 1979, was long considered practically an arm of
Wm. Wrigley & Co. But the agency has in the past five years won work in the liquor, insurance, healthcare and technology categories, doubling its billings to $400 million.
“When BBDO goes into a market, it’s never the intention to have a one-trick pony,” said Tonise Paul, chief executive officer of BBDO, Chicago. “For a while, the obstacle that we had was that no one knew we were here. What we found is that we weren’t even on the radar screen.”
Building on the brand identity of the bigger sibling helps gain attention. Paul said she doesn’t try to distinguish the Chicago office from the New York brand. “We’re not a version of the brand. We are the brand,” she said.
Following a similarly loyal model, Rubin Postaer and Associates Chicago has undertaken no specific branding activities for its office. RPA maintains a direct connection to its California headquarters and is not a wholly separate profit center, as are some offices of the New York agencies. RPA maintains executives in Santa Monica whose specific job is to “make what we need happen,” Marks said.
Deutsch’s Drakoulias, not ruling out future growth in this city, says the important thing would be to have the right people in place. “Kindred spirits” who would take the Deutsch brand identity and run with it.
“It’s like children from the same parents. The DNA is the same but different personalities come out,” he said. “It’s all about resources and building the brand thoughtfully.”
Lowe Lintas’ demise came simply because it failed to win new business. The shop’s only account wins came after it purchased direct agency Columbian in January 1999 and subsequently won Michelin and DirecTV direct marketing business.
Brinegar said he remains convinced the shop was headed in the right direction. “The first year we made the first cut [in reviews] and in the second year we were making the finals,” he said. “Hanging in there is part of it.” K