AGENCY OF THE YEAR: TEN REASONS WHY TBWA/CHIAT/DAY IS CREATIVITY'S AGENCY OF THE YEAR (. . . AND FIVE REASONS WHY THEY ALMOST WEREN'T).

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1998 will probably not be remembered as a banner year for creative advertising in the United States. Lots of singles and doubles, not too many round-trippers. Occasionally, something captured the public consciousness for a moment or two -- Miller Genuine Draft's odes to duct tape and other macho pleasures; the irresistible Gap "Swing" commercial; Adidas' paunchy "ANSKY" gang -- but such bright spots were scarce.

Top creative agencies like Wieden & Kennedy, Fallon McElligott and Goodby Silverstein & Partners each had their moments this year, but, overall, their work didn't reach its usual high standards. And clients that have historically made a lot of creative

noise -- Nike, Pepsi, Levi's -- were relatively quiet in '98. And then there was TBWA/Chiat/Day, which just kept chugging along, continuing the comeback story that began two years ago. "I think it's entirely appropriate" that Chiat takes Agency of the Year honors again, says Ernie Schenck, a CD at Hill Holliday in Boston. "They consistently stick their neck out for the work. They work in a rarefied pocket of air that few others do."

Perhaps the agency didn't turn in as strong a creative performance this year as it did in 1997; but then, it would be hard to match a year in which red-hot new campaigns broke for Apple Computer, ABC, Taco Bell and the Weather Channel. If 1998 has featured less in the way of high-profile introductions of new campaigns, it has been a year in which some of Chiat's previously-planted creative seeds began to blossom and bear fruit for clients -- particularly Apple and Taco Bell. "Chiat used to be known for bolting out of the box, but what we've seen in the last year is a couple of campaigns that have emerged and gotten stronger over time," says Marty Cooke, CD at Merkley Newman Harty and a former CD at Chiat/Day's New York office. True: under the leadership of Jay Chiat, consistency was not a strong point. But under the seemingly more evenhanded guidance of Lee Clow and Bob Kuperman, all of that may be changing. "We've worked hard to stop the roller coaster," says Kuperman. There's no single, overriding achievement that catapulted the agency above the rest of the pack this year. But there are lots of individual reasons worth noting. We've listed them, starting with the biggest (and littlest) reason of all:

1) That damn Chihuahua. Nobody is yet suggesting these ads will end up in a creative hall of fame; on the contrary, it's quite possible that before too long, the Chihuahua will join Spuds MacKenzie in the resting home for overhyped ad critters. But for now, give the puny perro his props. After being unveiled in late '97, he simply exploded in '98, even swallowing Godzilla whole in that "Lizard, Lizard" joint promotion. Does anybody really know why the Chihuahua is so popular? Vada Hill, chief marketing officer at Taco Bell, theorizes that it's because the dog is "a perfect personification of a quirky, iconoclastic, quasi-Mexican brand." Nice try, but we don't theenk so. The TBC is no more explainable than, say, Clara Peller of "Where's the Beef?"

No matter. Creative people can stumble across such phenomena and then have the good sense to realize that what they've got is a one-way ticket to pop-cult fame. In this case, it was the Chiat creative team of Chuck Bennett and Clay Williams. They'd been laboring over a weird series of Taco Bell ads set inside a stomach. Taking an outdoor lunch break one day, the pair observed a passing Chihuahua "who looked like he was on a mission," says Bennett. And so was born the tale of the dog on the endless quest for tacos. "It's like Gilligan's Island -- he's never going to get that food," says Williams. But he's getting everything else, and so are the creators, who now find themselves talking Hollywood development deals about possible Chihuahua sitcoms or features.

2) Apple received textbook mouth-to-mouth. OK, Steve Jobs had something to do with it, too. As did the introduction of the i-Mac, a machine almost as cute as the TBC. Still, the "Think Different" campaign, which took home many of the top creative awards in 1998, deserves all the accolades for a couple of reasons. First, it's a great piece of jujitsu positioning that takes Apple's weakness -- a small customer base -- and turns it into a badge of exclusivity. And, just as important, the campaign worked wonders internally for Apple. Jobs told Clow recently that the "aren't-we-special" ads provided a rallying cry for the entire company. The biggest challenge for the agency has been creating product ads that can live up to the drama of the image campaign.

3) They're the new masters at creating pop cultural icons for brands. Not since the old Leo Burnett, with its Jolly Green Giant, Snap/Crackle/Pop, etc., has an agency been so adept at creating instantly recognizable characters and visual images that come to symbolize a brand. The Chihuahua; the Energizer Bunny; ABC yellow; the "Think Different" portraits. It even holds true with less celebrated characters like Nissan's Mr. K and the Weather Channel's meteorology fanatics. You see just a flash of any of them, you think of the product.

4) They're not pissing off clients the way they did in the 1980s. "In the past, we didn't put enough into account management," says Kuperman. "Jay was famous for lots of things, but building relationships with clients was not one of them." Today, says Taco Bell's Hill, "the agency really understands and embraces the idea of a partnership with clients." Yes, the New York office has lost a few clients in the past year, including most recently the sleepy Van Heusen account. But the Los Angeles command center has been rock-solid -- even managing to hold onto Nissan (albeit with a loosening grip of late) in spite of disappointing sales and a wholesale change in brand management that ordinarily might have caused a knee-jerk parting of the ways.

5) They've figured out how to hold onto creative talent. Quietly, Clow has built and maintained a roster of solid veterans, including Bennett and Williams, Jerry Gentile, Rich Siegel and John Shirley, Craig Tanimoto and the heir apparent, Rob Siltanen. The agency has creatives who've been there for a decade -- try finding that at Goodby. "We've been through all that crap of complaining that everybody's hiring all our good people," says Clow. "We've been able to move beyond it." How? Clow is providing more autonomy than ever these days to his senior creatives, though he's still very hands-on with certain accounts, such as Apple. Gentile, a 10-year vet, says that part of the reason people are content now is that "they have the opportunity to do award-winning work on just about every account, not just the prized accounts."

6) They stir up more debate than Bill Maher. Sometimes, it borders on the ridiculous: the Taco Bell Chihuahua is racist because of the accent? Por favor! "Think Different" is bad grammar? Get a life, English majors; besides, what do you want, good grammar or good taste? The ABC tongue-in-cheek "TV is good" theme has spawned more couch potatoes? Not likely -- as quickly as Chiat can draw them to the tube, ABC's shows will drive them away. Regardless: much of Chiat's work seems to get somebody, somewhere all worked up. "We're not consciously trying to stir up controversy," Clow insists, but he is unapologetic. Ads that touch nerves? Guilty as charged. "I've come to take it as a compliment," says Clow. What may be most impressive is that the agency persuades clients to stay the controversial course, even after the arrows start flying.

7) They've revitalized outdoor. First it was the yellow ABC billboards taking over the L.A. landscape. Then, the "Think Different" images everywhere you looked: Hitchcock on the side of a building, peeking from around a corner, or -- best of all -- Rosa Parks on the side of a bus. Finally, they brought back a no-nonsense Marilyn Monroe and blew her up like the 50-foot Woman, for Levi's. The agency has taken the oldest medium and made it seem new again. "They have mastered the art of outdoor, and of getting their message to the street," says Cooke.

8) The bottom drawer is small. The agency doesn't have much to hide these days, in terms of sub-par work for lesser clients. Home Savings of America might fall into this category, considering that the agency recently over-produced one of those earnest "moments of your life" commercials that looks like a John Hancock wannabe ad (worst of all, the woman doing the voiceover has a lisp). But aside from that, everything -- from the wacky Sony PlayStation work, to the Weather Channel (be patient, a return visit to The Front is on the way), to a promising-looking breaking campaign for Kinko's -- holds up under scrutiny. (On the other hand, if they're not careful, the New York office will become one big bottom drawer.)

9) They changed broadcast networks' approach to advertising. Love it or hate it, the ABC campaign has had a profound impact. It introduced the very notion of branding to the clueless networks, and subsequently prompted NBC and CBS to try their hand at quirky image advertising that came off as a weak knockoff of Chiat/Day's work. The campaign has evolved this year to include some nice touches, including the often hilarious "ABC Cheap Cinema Theatre" series, in which stick-figure drawings summarize the plots of movies like Titanic (ship hits iceberg; captain yells "Oh crap!"; ship goes down; the end). It does seem that the new tagline, "We love TV," is a bit wimpy compared to the daring suggestion that "TV is good." Still, the agency has given ABC a signature look and attitude. Now if only it could do something about a primetime lineup that relies on clunkers like Cupid. As one Chiat creative commented, in total seriousness, "I think they ought to try turning the programming over to Lee, just to see what would happen."

10) Clow is Michael Jordan. Yes, we know -- everyone's heard quite enough praise of Clow by now. So let this be the last of it: He is identifying great ideas, inspiring his creative team to do good work, and making true believers out of clients. Is there anything the guy can't do? Recently, on his shiny, freshly-built basketball court in the agency's new L.A. headquarters, he handed a visitor a basketball, while explaining that he hadn't played ball himself since high school. A few minutes later, he was spinning and launching a baseline jumper.

Five reasons they almost didn't make it:

1) The New York office is shaky. Hard to imagine it now, but back in the early '90s, some of Chiat/Day's best work came out of the Big Apple. No more; just about every talked-about ad coming out the agency today has a "made in L.A." label attached. To make matters worse, New York can't seem to hold onto a creative director; the latest casualty, Eric McClellan, bailed out in October, expressing frustration with New York's identity crisis. So what's going on? For one thing, New York has had to deal with major distractions in the past few years: A downtown virtual office that looked like Disneyland and functioned disastrously; a shotgun marriage to a largely incompatible partner in TBWA (New York bore the brunt of the merger, while L.A. got off scot-free).

But there also seem to be deeper problems at work. One former staffer says the company can't decide if it wants New York to be a staid international business office for the global TBWA network, or a bona fide creative shop. And several sources speak of the dysfunctional sibling relationship between east and west. "The L.A. office meddles just enough that New York never gets to properly fail or succeed on its own," says Cooke, who worked at the N.Y. office from 1989 to 1996. Kuperman admits to some meddling, but says part of the blame lies with New York. "There's been a schizophrenic attitude there, in terms of wanting the help and not wanting it." Lots of people wonder why Clow doesn't get more involved, but he says: "The key is to get the right people there, and then walk away. I can't creative-direct New York -- that's bullshit." For now, Kuperman has decided to spend most of his time there, trying to, among other things, find a heavyweight CD. One positive note: The New York office has won several new-business pitches in the last year, including Barnes & Noble.

2) They're developing an eerie dependence on dead celebrities. First Apple, then Levi's. What's next -- Leonardo Da Vinci for Kinko's?

3) They still haven't nailed it with Nissan. To the dismay of some and the relief of others, Mr. K. has been deported, probably never to be seen again. But that just raises the question: Where does Nissan go from here? There are now plans to set up a separate spinoff creative group, to be known as Blacktop Advertising, to handle Nissan's dealer advertising workload, while Chiat continues to focus on the brand. After a relatively quiet 1998, look for Nissan to make some noise in months ahead (Chiat recently got approval on a slate of eight new commercials) -- but don't expect anything as abstract as "Toys." "We'll be doing more model-focused advertising for now," says Siltanen, sounding just a tad beaten-down. For both client and agency, the clock is ticking.

4) They probably should've killed the Bunny, and didn't. No matter how durable your batteries are, 10 years is a long time to keep running in place. In fairness, Bennett and Williams have tried putting new twists on an old sight gag: Last year it was the Bunny chasers, this year it's a pit stop theme, in which mechanics insert a new, stronger battery into a turbo-charged, high-speed bunny. As Williams notes, "It's hard to turn your back and move away from a campaign that has as much equity as this one." Still, sometimes you've got to pull the trigger.

5) They haven't hit it out of the park with Levi's. The Levi's work has been interesting and attention-getting, from the "Our Models Can Beat Up Your Models" billboards to the Mark Fenske soliloquies about hard jeans, which include some downright startling ideas. The problem is that this is a world-class client responsible for some of the most memorable, big-time commercials in recent years. One might reasonably have expected an opus from Chiat, something along the lines of "1984" or "Think Different," though that wasn't the agency's mission in this case: Levi's, feeling it had been overexposed and "massified," was looking for a different approach, and the agency sold them on a splintered, from-the-streets, guerrilla-style attack. In that context, the agency has delivered so far -- but the ads still feels less than completely satisfying.

On a positive note: given the agency's (and Levi's) creative pedigree, we predict an upswing in the ads that will bring their quality closer to BBH's

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