South America

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Expansion into South America by U.S. advertising agencies was a natural outgrowth of increasing trade and investment in the region. By 1920, the U.S. exercised overwhelming economic and political influence in South America that included dominance of communications and the mass media. U.S.-based companies also came to dominate wire-service news and the motion picture industry.

The South American ad industry followed a model based on the U.S. As early as the 1930s, U.S.-based agencies were helping foreign multinationals in South America build a culture of consumption using radio and print advertising. In 1941, Colgate-Palmolive-Peet Co. introduced a radio novella in Brazil to sell its toothpaste. (The choice was fortuitous, as radio remained the most popular medium in South America into the 21st century.)

The media

In contrast to their counterparts in Europe, the media in South America are mostly privately owned. Over the years, media-baron families developed cozy relationships with authoritarian regimes in order to remain commercially successful. In 1926, the Marinho family, the dominant force in Brazilian media today, founded the newspaper O Globo, which became the foundation of the family's media power.

Radio developed along the U.S. model of private ownership, as did TV, with TV Globo receiving infusions of U.S. aid. That investment allowed the Marinho family to develop a private TV empire by 1965. The family helped build an important infrastructure in Brazil and South America that enabled the continent to compete in the global new media and technology race.

In Argentina, the media organization Grupo Clarin holds a similar position.

Within the advertising industry, private companies developed their own local agency empires and expanded them through partnerships, mostly with U.S. multinational agencies.

Agencies such as McCann-Erickson recognized the power of the local media barons and moved rapidly to build relationships. Armando de Moraes Sarmento, general manager for McCann in Brazil, became the most famous Brazilian adman of his generation, leading the agency there from 1935 to 1953. Among his achievements was winning the Coca-Cola account for McCann.

Agency powers in Brazil

Almap/ BBDO was founded in 1954 by Caio de Alcantara Machado and his brother Jos&eacaute; in São Paulo as Alcantara Machado Publicidade. In 1960, the brothers hired Alex Periscinoto, then the ad manager of São Paulo's leading department store, who brought the Volkswagen account to Almap and is credited as the first in Brazil to pair creative directors with copywriters as a team on ad campaigns.

In 1993, the shop sold a share to Omnicom Group's BBDO, gaining access to the agency holding company's international network. In 2000, Almap/BBDO was named Agency of the Year both at the Cannes International Advertising Festival and, for the third consecutive year, by the Advertising Columnists Association of Brazil.

Duailibi Petit Zaragoza Propaganda was founded in São Paulo in 1968 and named for its founders: Roberto Duailibi, Francesc Petit and José Zaragoza. One year after its creation, the agency won Sao Paulo's ad of the year award for a print ad for optical retailer Fotoptica. In the 1970s, it created the "Bombril Boy" character for marketer Bombril; the enduring ad icon was still being used at the beginning of the 21st century.

In 1975, the shop won its first Gold Lion at the Cannes festival, for a film that opposed discrimination against older workers. In 1986, Washington Olivetto, the DPZ creative director often credited with many of the shop's award-winning campaigns, left the company to set up W/Brasil in cooperation with the Swiss company GGK.

DM9 was founded in 1975 by Duda Mendonca in Salvador, Brazil. Its awards include being named Agency of the Year by the Cannes festival in 1998 and 1999, the first agency not headquartered in New York or London to receive such an honor; a Cannes Grand Prix in the print and poster competition in 1993 for ads for the soft drink Antarctica Diet Guarana; and numerous U.S. advertising festival honors. The agency, now located in São Paulo, was the creator of the only Brazilian spot among those chosen as the 40 best of the century by the Cannes festival in 1998.

Nizan Guanaes, who served as president of DM9 in the 1990s, was termed a "maestro with a talent for netting awards" by the U.K.'s Campaign. Mr. Guanaes himself is one of the most honored advertising men in Brazil, where readers of Gazeta Mercantil, the country's daily business newspaper, twice named him Brazil's most effective and creative adman.

In 1992, he was the first Brazilian president of a jury at the Cannes festival. In 1997, in what has been described as the biggest deal in Brazilian advertising, DM9 merged with the DDB Group to form DM9 DDB Publicidade. As a result of the merger, the agency picked up such multinational clients as Texaco, Honda and Anheuser-Busch Co.'s Budweiser beer.

W/Brazil was founded as W/GGK but renamed W/Brasil in 1988, two years after it opened. At the turn of the century, the shop worked both for large local clients, such as Unibanco and Sadia, as well as multinational marketers such as Mercedes-Benz and Bombril/Henkel.

Other agencies

Argentina arrived as an ad agency power with the 1994 formation of Agulla & Baccetti, named for founders Ramiro Agulla and Carlos Baccetti. After launching their agency in Buenos Aires, the pair garnered prizes and won accounts ranging from Renault to Italian dairy giant Parmalat. The agency's campaign for Brazil's Banco Itau, which spoofed Argentine banks' notoriously poor service, won the shop considerable attention.

In 1997, the agency formed a partnership with Britain's Lowe Group, which bought a 20% stake. Lowe, part of the Interpublic Group of Cos. network, also entered the Chilean market through a partnership with Santiago-based Porta. Raul Menjibar founded Porta, later Lowe Porta & Partners, in 1981.

While U.S. advertising agencies predominated in South America in the 1990s, they were not the only foreign multinationals operating in the region. European agencies doing business there included the U.K.'s Saatchi & Saatchi, which held a majority stake both in the Brazilian agency F/Nazca, founded by Fabio Fernandes, and the Argentinian agency Del Campo Nazca, founded by Pablo Del Campo. French advertising roup Publicis bought a controlling interest in Norton Publicidade, a Brazilian agency founded in 1946, which it renamed Publicis Norton. Publicis added 60% interest in D&M Comunicação in 1999.

South America continued to see an entrepreneurial spirit among local advertising agencies, with independents springing up each year in the late 1990s. Many shops were started by talented creative people who had worked at other local agencies such as DM9, DPZ or W/Brazil, but were ready to strike out on their own. One such shop, opened in 1980 in São Paulo, was Talent Communicação, founded by Julio Ribeiro. (He opened a second agency called Talent Biz in 1995.)

A more recent example is Age (from the Portuguese verb meaning to act), an agency founded in 1999 by three former employees of DM9 DDB: Ana Lucía Serra, Carlos Domingos and Tomás Lorenti. The French agency Havas bought a minority stake in Age soon after it opened, and the shop became a unit of Havas' Arnold Worldwide Partners.

Contrary to the practice of U.S. and European agencies, South American agencies have been slow to embrace the concept of full-service shops, offering clients more than the creation and placement of ads. Agency principals seem to prefer staying active in the creation of ads rather than moving into the ranks of management.

New media

South America was already looking to new-media entrepreneurs to expand advertising revenue and sales in the region at the end of the 20th century. One such person was Fernando Espuelas, a Uruguayan-born entrepreneur dubbed the "Bill Gates of Latin America" for his founding of StarMedia with partner Jack Chen. StarMedia, an Internet company, was started in 1996 to reach Spanish- and Portuguese-speaking consumers with products. Mr. Espuelas saw the Internet as a means for ad agencies to bring consumers to a global marketplace where all could share products and ideas across cultures.

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