Deutsch Inc.

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Founded by David Deutsch, 1969; leadership assumed by his son Donny, 1989; opened office in Los Angeles, 1996; expanded into Chicago and Boston, 1998; named Agency of the Year by Advertising Age, 1998; acquired by Interpublic Group of Cos., 2000; closed Boston office, 2001.


Deutsch dates back to an ad agency specializing in print ads founded in New York in 1969 by David Deutsch. He ran the shop for 14 years before his son Donny joined him as an account exec. Donny's only previous agency experience had been at Ogilvy & Mather Worldwide, where he spent less than a year as an assistant account exec on the Maxwell House account.

In 1989, the elder Mr. Deutsch handed the business over to his 32-year-old son, who oversaw the expansion of Deutsch into the nation's largest independent agency, with billings reaching $1.2 billion in 1999.

Deutsch's first work included controversial ads for the Swedish home furnishings marketer Ikea, which broke ground because they featured interracial and gay couples. At that time Ikea, a retail powerhouse in Europe, was still unknown to U.S. shoppers and needed to make a big impression. The campaign was so productive that Deutsch won Ikea's entire $40 million-plus account in 1997. Ikea, however, pulled the plug on Deutsch in 2000 to seek a new image, putting its advertising into review; Deutsch did not participate.

The agency struggled to break out of its image as a New York-centric company. In 1996, Deutsch opened an outpost in Los Angeles. It was so successful that it was expanded and started exchanging its smaller clients, such as chef Wolfgang Puck, for bigger accounts. The next year, the Los Angeles office won the $60 million Bank of America account and the $25 million Baskin-Robbins USA business. Donny Deutsch added seven equity-holding partners to help silence comments that he was the agency's sole decision-maker.

Things were going well at the New York office, too. When Triarc Beverage Cos. acquired Snapple in 1997, it hired Deutsch to handle the $30 million account. Of particular note was the agency's reintroduction of the brand's popular spokeswoman, Wendy Kaufman, the renowned Snapple Lady from earlier ads created by Kirshenbaum & Bond.

In 1998, Deutsch added offices in Chicago and Boston and bolstered its integrated offerings by adding direct marketing and interactive capabilities.

One of the agency's biggest coups was its 1998 win of the Mitsubishi Motor Sales of America account, worth $250 million. Deutsch wrested the Mitsubishi account from McCann-Erickson Worldwide, a much more established agency.

That year, Deutsch was named Advertising Age's Agency of the Year

The next year was one of continued success—the agency's biggest up to that time. Deutsch added premium clients such as Pfizer (Zyrtec allergy medication), Bank One Corp. and Brink's/Citizen Watch Co. of America, garnering a total of about $510 million in new billings. Deutsch seemed unstoppable, winning 11 of the 12 accounts it competed for, failing to gain only Toys "R" Us.

Deutsch also took on creative responsibilities for the $100 million Ann Arbor, Mich.-based Domino's Pizza account.

The agency then acquired the account of Reflect.com, a Procter & Gamble Co.-owned Web site marketing customized cosmetics online. Hiring Deutsch was a departure from P&G's longstanding practice of awarding new business to its roster shops.

Deutsch took on additional Internet clients, including Britannica.com, Ashford.com and Myfamily.com, as well as opening dRush, a youth-marketing joint venture with rap musician and fashion magnate Russell Simmons' Rush Media. While the dot-com shakeout in 2000 affected Deutsch's client list, the agency retained Ashford.com and Reflect.com.

During 2000—with a client portfolio that included DirecTV, Domino's Pizza, General Nutrition Centers, Microsoft Corp.'s Expedia, Mitsubishi Motor Sales of America, Pfizer's Zoloft antidepressant and Zyrtec, P&G's Reflect.com, Snapple, Sun America and Timmy Hilfiger—Deutsch was ripe for acquisition.

The Interpublic Group of Cos. bought the agency in November 2000 for an estimated $250 million.

In 2001, Deutsch was the No. 15 U.S. agency with U.S. gross income of $202.5 million, up 22.7% from the year before, on billings of $1.86 billion, up 22.6% from the previous year. The agency, under Interpublic's Lowe (The Partnership) umbrella, closed its Boston office in July of that year.

In 2003, Deutsch was the 13th largest U.S. agency, with revenue of $167.2 million, a 5.7% increase over 2002.

In 2004, agency head Donny Deutsch continued his separate career as a TV host and investor in independent movies.

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