Springer & Jacoby closes – how long can a hot shop stay hot?

Germany’s most famous agency Springer & Jacoby has gone bust after failing to recover from the loss of the giant Mercedes account in July 2006.

For a number of years the agency, credited with being the most creative in Germany, was majority-owned by Interpublic (IPG) but was then acquired by German communications group Avantaxx in October 2006, hardly great timing when you think about it.

Mercedes had left for rival Jung von Matt, set up by former Springer-ites as have been a number of other German agencies. Springer & Jacoby itself was formed by Reinhard Springer and Konstantin Jacoby in 1979 and at one time handled the likes of Coca-Cola, Deutsche Telekom and Lufthansa as well as Mercedes. But, at its demise shortly after its 30th birthday, the biggest account was Osram light bulbs.

Hot shops don’t stay hot forever and often the best way out is to sell to an international network that understands, or at least tries to, the ethos of the agency it’s buying. Abbott Mead Vickers and Boase Massimi Pollitt in the UK both chose the US Omnicom group as a home, signing up with BBDO and DDB respectively within Omnicom. CDP hooked up with Japanese giant Dentsu and withered away.

Springer and Jacoby chose to sell a stake to the True North holding company, home of FCB, in 2000 and promptly embarked on the attempt to form a European S&J network. But FCB was never a truly potent international force as it just didn’t have the huge international accounts to fund network growth in other markets.

When True North was bought by IPG in 2001 it was a case of out of the frying pan into the fire as IPG then had big financial and growth problems of its own. Pouring money into a European start-up network wasn’t high on the agenda.

And S&J’s creative reputation didn’t travel too well either, no doubt unfairly but most clients didn’t associate Germany with creative ads. Neither did the flagship Mercedes account do the agency too many favours. Mercedes advertising was not admired at the time, many people thinking the marque was successful despite the advertising.

It’s not impossible for European agencies to succeed on the world stage of course, French-owned Publicis and, to a lesser extent, Havas have succeeded in so doing although they’ve been helped mightily by the desire of both the French government and big French companies (some would say they’re one and the same) to keep French business in house.

WPP is a British company (actually Irish now, technically) but its growth has come through acquiring US-based networks JWT, O&M, Grey and Y&R.

So let’s try to answer our question. How long can a hot shop stay hot?

Well, on the evidence of S&J, CDP and BMP (not a large sample admittedly) 20 years is achievable, 30 is pushing it a bit.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.