NEW YORK (AdAge.com) -- The man who pioneered the holding-company concept, Philip H. Geier Jr., grew up in Cleveland during the Great Depression. The oldest of six boys, he earned the nickname "Deals" as a youth because of his business acumen. He got his first taste of adland while dating Joan Bennett (who would go on to marry Ted Kennedy), whose father was in the business.
Mr. Geier started at McCann-Erickson in 1958 and in 2000 retired as chairman-CEO of Interpublic Group of Cos. after a 20-year run in that post. A onetime chairman of the Ad Council, he currently serves as chairman of the Geier Group, a New York-based marketing communications and venture-capital firm.
Now 74, he began working on his first book, "Survive to Thrive: Sustaining Yourself, Your Brand, and Your Business from Recession to Recovery," last spring. The 250-page tome is written in the form of a time line, interspersed with business lessons learned working with blue-chip Interpublic clients such as Coca-Cola, Nestle and L'Oréal.
At one point he talks about a bomb scare in the middle of a pitch for Martini & Rossi, and offers surprisingly kind words in the book for his former rivals, the heads of Omnicom Group and WPP, John Wren and Martin Sorrell.
The book delves into why Interpublic pursued certain acquisitions and, in his words, "why some worked, why others failed." He talks about how he grew Interpublic to what was at one time the largest ad-holding company in the world, but also addresses its business troubles, including a period of accounting woes, and he admits to a disastrous move under his watch that saw Interpublic getting into Formula One racing.
Mr. Geier gets personal too, talking about courting his wife of nearly 50 years, Faith, and how a liberal Democrat was the source of a heart transplant in 2006 that saved his life. (Mr. Geier is a lifelong Republican.) Photos of Mr. Geier show him with the likes of Princess Diana, Jack Nicholson and Rupert Murdoch.
Ad Age spoke to Mr. Geier briefly ahead of the launch of the book, available on Amazon.com starting today. All the proceeds from sales go to Save the Children and Autism Speaks.
Ad Age: In the book you talk about living through different tough economic periods and holding clients' hands through them. Witnessing what's going on with the economy now, what's different or harder for marketers who are grappling with the recession today?
Mr. Geier: This one is a much tougher recession than the others because of the fact that the financial infrastructure has been semi-destroyed. In the past that's not been the problem, it has been that consumer aspects are hurt. This is worse, and it's going to take longer to come out of. The problem now is getting the consumer to spend, because if we don't do that, the economy isn't going to come back. You've got to entice them to save and spend at the same time, which is not easy.
Ad Age: Having built the original holding company and acquiring the various agencies that make up Interpublic today, do you think the holding-company model is still the right model for marketers, particularly big global ones?
Mr. Geier: Yes. The holding-company operation is still valid as long as it maintains the position that they can provide administrative and financial services in the center, and at a lower cost than they would if they were in the individual agencies. But [regardless of the model] the most important thing is making sure that the right people are in place at the agencies.
Ad Age: Do you think we might see consolidation in the near term among the holding-company players?
Mr. Geier: This recession is not easy, and the industry is going through a very tough period, so there may be some consolidations of agencies. I can't see holding companies consolidating, though I must say the conflict situation has changed so much since my day -- it seems that clients switch back and forth between holding companies and are much easier on conflicts.
Ad Age: It does seem like some of those traditional conflict situations have broken down in categories -- even in categories that were once strict about it like the colas and car marketers. Why do you think that is?
Mr. Geier: Part of the reason why is that the relationships at the top of the client and at the top of the agencies have worn thin. People don't really have the same quality of and trust in relationships anymore, and therefore the marketing people are operating from the viewpoint of what's best for them and don't look at the total picture as much.
Ad Age: How do you think Interpublic is doing these days?
Mr. Geier: I think they're in the process of coming out of a problem. A major recession hit just as they [were] in the process of getting their act together and going in the right direction, so it has been a bit of a stopper for them. But that's a question I stay away from as much as I can because anyone that used to run something for so long can't help but be critical of what's going on there and be concerned about it. But they've got their leadership now, and hopefully it'll work itself out.
Ad Age: You talk about high points and low ones of your business career in the book. Looking back, what do you count as your biggest business mistake?
Mr. Geier: I wrote about it in the book. I made a huge mistake with the racetracks. We got into physical businesses which we shouldn't have done. It looked like a great opportunity, and the marketing aspect of it was good -- there is a lot of money to be made managing -- but to get in, we ended up buying into a racetrack, and that was a stupid move on everyone's part, but I was the one that OK'd it, so ultimately it was on me.
Ad Age: It's interesting that Omnicom Group's CEO John Wren was among those who gave you some advance praise for your book. Are you two friendly?
Mr. Geier: Oh yeah. He's a straight shooter. He runs a great operation, and I hope he stays there longer for the good of the company.
Ad Age: How long will you stay in the business?
Mr. Geier: I think I got a couple more years. Well, three or four at least. I'm not going to go easy.
What the holding company should doIn his book "Survive to Thrive," Phil Geier shares his opinion on how ad holding companies should and should not operate.
- Set corporate strategy and financial objectives.
- Establish fiscal management and operational controls.
- Guide personnel policy.
- Incubate new programs and project for implementation by the operating units.
- Initiate, manage and approve mergers and acquisitions.
- Provide centralized functions: legal, real estate, travel services, recruitment aid, employee benefits and executive compensation management.
What the holding company shouldn't do
- Pitch new business.
- Compete with agencies in offering creative or other client services.
- Manage day-to-day client relationships.
- Discourage agencies from developing the skills they need to stay competitive -- internally and externally.
- Limit the autonomy or accountability of agency management.