Five things you didn’t know about advertising agencies: 1990s (2)

1/ Of course you all know about Sir Martin Sorrell, CEO of WPP, who, more than anyone, defined the 1990s just as his former employers the Saatchi brothers had defined the 1980s. But just what is it about Sorrell? Why is he, still, a visionary and great global businessman to some and the devil incarnate to others, including many of his own employees? Sorrell, the former group finance director of Saatchis, began his WPP empire with the purchase of quoted shopping trolley company Wire and Plastic Products in 1985 which gave him a stock market vehicle. He then bought a gaggle of design firms before using the company’s highly-rated stock and hefty borrowings to buy Madison Avenue giants J.Walter Thompson for $566m in 1987 and David Ogilvy’s Ogilvy & Mather for $825m in 1989. Ogilvy, Surrey-born but a professional Scot, didn’t like this at all and called Sorrell an ‘odious little shit.”

2/ A view shared by many as WPP snapped up companies across the marketing spectrum, some of these deals worked but others did not. Perhaps the most embarrassing example was the Red Cell network, launched in 2001. Red Cell was supposed to be the fourth WPP ad agency group alongside JWT, O&M and Young & Rubicam (which it bought for $4.7bn, there’s inflation for you, in 2000). It was based on an agency in Italy which handled the Alfa-Romeo account, was supposed to be creative and geared to handle smaller accounts than WPP’s global giants. In 2001 Sorrell added the highly-regarded New York hotshop Berlin Cameron & Partners and installed Andy Cameron as head creative. He also recruited Lee Daley from McCann-Erickson as CEO. In 2002 he bought London agency HHCL from his old Saatchi colleague Tim Bell’s Chime.

3/HHCL (then Howell Henry Chaldecott Lury) had been a leading member of the so-called ‘third wave’ in London, a new flood of start-up agencies following in the wake of WCRS and GGT (the first wave had been the likes of CDP and BMP). Rupert Howell was the ace schmoozer account man, Steve Henry and Axel Chaldecott the creatives and Alex Lury the planner. HHCL produced much-admired work for First Direct, Tango and Fuji among others, none of them especially big brands in the UK. But its aggressive and ingenious ads, like this one for Tango, helped it win Campaign’s accolade as ‘agency of the decade’ in 2000. And a right old poisoned chalice that turned out to be.

4/ Chime bought HHCL in 1997 but the PR-based business (despite Bell’s background as managing director of Saatchis where he knew Sorrell well, of course) didn’t deliver the access to big clients and endless money HHCL sought and HHCL proved not to be the dynamic agency business builder Bell imagined. The late 1990s were tough times for ad agencies with money already starting to migrate to the internet and cost-conscious clients slashing billings and fees where they could. Chime eventually offloaded what was left of HHCL (the partners had long since fallen out) to Sorrell and Red Cell in 2002. But Red Cell just wasn’t happening and one reason, so some of its former employees say, was Sorrell’s impatience with and brutal financial management of a creative-based business he didn’t understand. Red Cell was renamed United in 2006 (someone at WPP must have had a sense of humour) and put out of its misery entirely in 2007.

5/ But that’s the enigma of Sorrell. He may have collected four of the biggest ad agencies in the world (he bought Grey Global for a pretty reasonable $1.3bn in 2004) but his detractors would say he doesn’t really understand advertising (or advertising people anyway, particularly creatives) or even much like it. He’s much happier with his media agencies (Mediacom, MEC, Mindshare), research companies (the Kantar group which includes his latest big buy TNS) and digital companies. If this is the case it’s certainly not down to a lack of experience but maybe his close and personal knowledge of the excesses of the Saatchi empire (he oversaw most of their takeovers by organising generous earn-out clauses, the ultimate source of the agency’s downfall) put him off the breed even though he’s built a big part of his substantial personal fortune (around £100m) on their labours. And that’s why some of them dislike him so much.

So, sorry it’s been all Sorrell but a large part of the 1990s (and much since of course) really was Sorrell.