Solid creative and integrated approach put Minneapolis shop in the driver's seat
By Mark Gleason
When Minneapolis-based Fallon McElligott pitched the Prudential Insurance Co. of America account in early 1995, a boulder blocked its path: the long-running "Piece of the rock" slogan and icon.
The agency didn't want to bulldoze a piece of ad imagery with a century of equity in it. On the other hand, the rock carried some undesired weight.
"A rock is inflexible and impersonal," says agency Chairman Pat Fallon.
The solution: Dump the slogan, keep the icon and make it personal. With a campaign labeled "Be your own rock," Fallon won the $60 million account.
Transforming a brand by redirecting its existing strength has become a Fallon specialty. In the past two years, the 15-year-old agency has done it for brands as diverse as Prudential, Nikon and Purina Dog Chow.
At the same time, it has achieved the same feat on the inside, turning a highly regarded, regional print agency into a highly regarded, national agency that's a new-business machine.
SECOND TIME AROUND
For holding its creative edge while adding big-time bulk to its client roster, Fallon McElligott has been selected as Advertising Age's Agency of the Year for 1995.
New York's Lowe & Partners/SMS was the runner-up.
The choice makes Fallon the fourth two-time winner of the award; it also won for 1983, when it was known as Fallon McElligott Rice.
It wins as a different agency today. In the early '80s, it was a small start-up doing bold work--mostly print with clever headlines--that gained national attention for regional clients.
Today, 10 times bigger, Fallon does more TV than print for mostly national clients, and it holds a place among the elite midsize U.S. agencies such as Goodby, Silverstein & Partners, San Francisco, and Wieden & Kennedy, Portland, Ore.
Fallon last year won its usual gaggle of awards in creative competitions, including the One Show. More striking have been its recent victories in other arenas.
Last month, the agency won five Effie awards (for advertising effectiveness) from American Marketing Association. It won the Super Reggie award from the Promotion Marketing Association of America for BMW North America advertising featuring James Bond actor Pierce Brosnan. Three weeks ago, Apple Computer ran a commercial featuring Fallon's Web site for BMW, an ad created by Fallon rather than Apple's agency of record BBDO Worldwide, Los Angeles.
"A few years ago, people here wouldn't have even known what an Effie was," Mr. Fallon says. "And lots of them probably still don't know what a Reggie is."
Clients with big marketing budgets do know, however--clients such as Prudential, BMW, Ameritech Corp., McDonald's Corp. and Coca-Cola Co. Fallon won major assignments from all of these in `95 and early '96.
"I'm a big fan" of the agency, says Elizabeth Krupnick, chief communications officer at Prudential. Qualitative research results on "Be your own rock" have been "fabulous," she adds of the campaign that began airing this year.
LONG-SOUGHT CAR WORK
Fallon won BMW's $60 million car account last spring, shortly after the Prudential win. Fall '95 commercials for the Z3 roadster featuring clips from the latest Bond film, "Goldeneye," weren't Fallon's idea, but the agency's creative executions helped sell out the entire first production cycle of the new model.
The agency won Ameritech's long-distance account in June '95, two years after winning the Baby Bell's corporate account.
Two of Fallon's recent Effies were for Ameritech. One winning campaign boosted consumer awareness of the differences between AT&T and Ameritech from 30% to 70%, according to Kevin Berigan, account group director.
Fallon's other Effies came for its Black & Decker, Purina Dog Chow and Nikon accounts; all three have received Fallon-style transformations.
"They're smart people," says Jack Abrams, exec VP-chief operating officer at Nikon. "The advertising they have created is memorable and has great recall."
When Fallon pitched Nikon's camera account two years ago, Nikon told the agency not to meddle with its longtime tagline, "We take the world's greatest pictures." But the more Fallon looked at the brand's business picture, the more it decided that line wasn't right.
"It spoke only to professionals," recalls Mr. Fallon. "It wasn't accessible."
The solution, penned by agency President-Creative Director Bill Westbrook, consisted of one word: "Yours."
By adding that at the end of the existing tagline, the agency was able to speak to amateurs without alienating professionals--and win the business.
Altogether in '95, Fallon won four out of six new-business pitches. Billings jumped 17% to $269 million.
In '96, it has won a $20 million assignment from Brunswick Corp., the $70 million launch of a new burger for McDonald's Corp. and the $10 million Bankers Trust New York Corp.
Fallon began laying the groundwork for its recent success three and a half years ago, after it lost a close competition with Ammirati & Puris, New York, for creative on the $40 million MasterCard account.
The flow of new business at Fallon had slowed, and after falling far short in that particular pitch Mr. Fallon and his fellow partners, Group Director Fred Senn and Chief Financial Officer Irv Fish, were shaken. So Mr. Fallon retreated to his cabin in Wisconsin for some strategic thinking.
"I realized we needed to make major changes to compete at the level we wanted to," he notes.
Soon Mr. Fallon, 50, was fishing for new talent. In September 1992, he hired Rob White, 40, as director of account planning. Mr. White began to build a planning department.
Just then spreading throughout the U.S. agency business, account planning became crucial to Fallon.
"If there's one single thing that affected this agency, it's Rob White," says Mr. Senn, 53.
In March '93, Creative Director Pat Burnham resigned. He was replaced two months later by Bill Westbrook, 51, who came from Martin Agency to become president-creative director.
In the fall of '93, Mark Goldstein, 48, left the top job at Earle Palmer Brown Cos. to become president-integrated marketing.
The following year, Fallon took full control of its sister design agency, Joe Duffy Design, in a move designed to give it full integration of marketing services under one roof.
HOMES AS COLLATERAL
Meanwhile, the agency initiated a buyback of its shares from WPP Group. In October 1993, Fallon borrowed money for the first time in its history--$14 million--to reacquire itself. Mr. Fallon and other principals put up their homes as collateral.
All of these steps gradually transformed the agency. While Messrs. Fallon, Fish and Senn, along with dozens of other longtime staffers, provided a strong link to the agency's past, the new blood added important strengths.
Yet as the two generations of principals welcomed each other as partners, others in the organization reacted negatively, especially in the creative department.
"There was enormous resistance to the new four [Messrs. Westbrook, White, Goldstein and Duffy]," Mr. Fallon says.
But he and the others had a goal in their sights.
"Every agency in America, from boutiques to Grey Advertising, can do great creative," Mr. Westbrook says. "What makes a great agency is producing it, protecting it, nurturing it."
"Getting it sold," Mr. Fallon interjects.
Mr. Burnham and his work had been loved and admired throughout Fallon, but he had never been a salesman. Known for staying in the creative department most of the time, he wasn't considered a great presenter.
Mr. Fallon and the other principals felt they needed a better team for presentations. Mr. Westbrook brought a highly regarded portfolio of his own, but also a track record for closing sales. Messrs. Duffy and Goldstein gave the pitch team whole new playbooks.
About the same time the agency absorbed Duffy Design, which had a package design project for Coca-Cola Co., Coke asked Fallon to compete with Wieden & Kennedy, Portland, Ore., on a new-product assignment. Fallon won the pitch.
Though the product has yet to be launched, the agency principals consider it the biggest victory of the new era.
"Coke proved we could work a different way," Mr. White says. From then on, Fallon took an integrated approach to every competition it entered, whether the clients asked for it or not.
Along the way, Messrs. Westbrook, Goldstein and White were attracting talented staffers from both coasts to Minneapolis. Then, in the spring of '95, the agency put a satellite operation in New York, joining with Andy Berlin, former partner in today's Goodby, Silverstein & Partners, to open Fallon McElligott Berlin.
GREAT BATTING AVERAGE
That unit has won nine of 10 pitches since its founding, including the Bankers Trust, Fresca and Diet Sprite work, and should pull in billings of more than $40 million in '96.
Beyond giving Fallon a New York presence, Mr. Berlin gave it a top-notch TV creative. Fallon's TV reel still was compared unfavorably with its print work.
But it's fast gotten better. Six of 17 spots on Fallon's '95 reel came from the New York unit.
Fallon McElligott billings will rise more than 20% this year, and the staff is 50% bigger than a year ago. With more than 100 new staff members in Minneapolis, growing pains almost surely lie ahead for the shop.
Also, the agency still lacks a solution for working internationally. All but three clients do business overseas, though only Bankers Trust has given it an international assignment.
DON'T WANT MORE DEBT
The principals say they have discussed a number of options for expansion, but they aren't excited about going into debt again so soon after the buyback to finance acquisitions.
The agency is out to illustrate the power of integrated marketing to current clients, as well as new ones.
WANTS TO REPITCH
A new campaign the agency created two years ago for Purina Dog Chow has helped increase the brand's sales more than 20%, and Ralston Purina Co. executives couldn't be happier.
However, Fallon McElligott recently requested permission to repitch Purina, competing against its own current work with an integrated marketing plan.
"We think we can do better," says Mr. White, proving that Fallon certainly has a healthy appetite for change.
Copyright April 1996 Crain Communications Inc.