In a business that venerates the 18-to-49 demographic, a lot of agencies have brought to life trendy liquors, beers, lip balms and tech products via product-development sidelines. It's not every day you come across an agency that has created a cane for seniors.
But the highly practical HurryCane has been a big profit winner for Minneapolis direct-response shop Marketing Architects. The agency invented, marketed, sold and distributed the cane, building it into a $50 million business before recently selling it to Drive Medical and retaining advertising duties via a long-term contract.
And the shop is far from done. It's also the creator of the plush toy/carryall for kids called Stuffies and has 20 more products in the pipeline, said agency founder and CEO Chuck Hengel.
So how did an 18-year-old Midwestern ad agency known for its direct-response acumen get into making a healthcare product for seniors? Marketing Architect's initiative to explore what it saw as an untapped opportunity in value product development began in 2008 after the recession.
The genesis of the HurryCane came after a bunch of ideas and contemplations that struck simultaneously. Mr. Hengel's mother-in-law, for instance, wanted to know why products for seniors were drab and gray, while another friend wondered why there weren't more products to help her parents who were aging at home. Around the same time, he read an article that cited falls as the top public health problem for seniors, then also noted the dearth of innovation in the cane category, and suddenly Marketing Architects began collaborating with its product-development sibling Zoomworks on the project.
Marketing Architect's chief technology officer became the first engineer for HurryCane, while one of its top designers who specialized in digital animation for TV began working on the design. When they got close to a prototype, they sent it to outside engineers at a factory. Meanwhile even more in-house talent went to work on naming, branding, marketing, web-site development, test marketing, packaging, shipping logistics and customer service. It took another seven to eight months – along with about $2 million in engineering costs -- before the product was ready and the first direct TV commercial launched.
HurryCane wasn't an instant hit. It was the third iteration of the TV ad that hit the right positioning, Mr. Hengel said, and sales took off. Today, HurryCane is the No. 1 selling cane on Amazon and on shelf at retailers Walmart and Bed Bath and Beyond.
No single person is credited with the invention of HurryCane, and the whole company will share in the sale proceeds. (Marketing Architects declined to disclose the purchase price for HurryCane paid by Drive Medical.) But Marketing Architects grants equity units to its employees and everyone, in varying amounts, will profit from the sale.
Mr. Hengel said it's hard to describe exactly how his agency made the specific jump to the HurryCane, but the overall shift to maker agency has been a creative rethink. The shop has set up a 5,000-square- foot innovation space inside the agency for example to facilitate that.
"We call it looking for white space. We look for those blank spaces and ask why isn't anyone doing anything in that space? It's still sort of like the crazy inventor, but we look at it from a marketing point of view," he said, adding "Entrepreneurs sometimes love their products too much. They don't want to make the changes that might be necessary to sell the product."
In fact, Marketing Architects often thinks about marketing and distribution before it thinks about the product, Mr. Hengel said.
Just launched is Beauty Whip, an anti-aging cream that consumers mix themselves at home to preserve Retinol's potency. On the horizon is a cooking product in the final stages, tentatively set for launch in the second quarter. That's provided the consulting engineer the company just hired can finalize the formula for the unique surface coating Marketing Architects wants. The company is also working with Drive on the next HurryCane, a luxury line of canes with leather handles, new coatings and a "gorgeous design," Mr. Hengel said.
"Our mission statement is 'to pen the blueprint of what's next to come.' So there is a spirit of innovation that people have here, but we also realize that without a plan, a dream is just a dream," Mr. Hengel said. "We're still practical and pragmatic. After all, if no one's going to buy your product, is it really even an invention?"
The list of maker agencies is long. Mother New York launched White Pike Whiskey, while Red Tettermer O'Connell & Partners created Tub Gin. Walton Isaacson made Tequila Avion come alive and Pocket Hercules handcrafts Lakemaid beer. R/GA co-created the Nike FuelBand, Anomoly created Eos lip balm and Deutsch LA's Side Project has funneled agency resources to help employee efforts like flower delivery Bouqs. Digital lab incubators, held close or spun into independent shops, are also popular, such as Wieden & Kennedy's PIE and Rockfish Interactive's Rockfish Labs.
The Society of Digital Agencies in 2014 found that 50% of the agencies it surveyed had innovation labs or product incubators, an increase of 30% over the previous year. Further investigation by SoDA in its 2015 survey found: "Moving from service-based model to product development involves a steep learning curve for agencies and production companies. After 2-3 years, that learning curve begins to flatten and more financial benefits such as significant funding, revenue growth and new business wins begin to take root."