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"WE'RE OPEN TO POSSIBILITIES' AYER CHAIRMAN JERRY SIANO DISCUSSES NEW BUSINESS, THE POTENTIAL FOR MERGER AND HIS OWN ROLE IN THE AGENCY'S CREATIVE PRODUCT

Published on .

Ayer Chairman Jerry Siano, 59, began his advertising career in 1956, when, as a student at the Philadelphia College of Art, he landed a part time job at Philadelphia's N W Ayer, then headquartered in Philadelphia. His boss, the late Charles Coiner, who retired in the 1960s and recently was inducted into the Advertising Hall of Fame, was so impressed with Mr. Siano's work he offered him a full time job.

"But I was from an Italian family," Mr. Siano recalls. "I was the first one to go to college, and I knew it would break my mother's heart if I didn't graduate. So we made a deal. Charlie let me work part time with the understanding that I would come to Ayer full time after graduation."

Mr. Siano began as a designer on such accounts as United Airlines, Armour Foods, Whitman Chocolates and Plymouth and advanced to art director two years later.

He remained at Ayer, joyously working as a creative most of his career. He left Ayer from 1959 to 1964 to serve as associate head of the art department at Philadelphia-based Aitkin-Kynett agency. After rejoining Ayer as an art director, he began a steady rise from co-creative director in 1966, vice president in 1967, senior VP-creative services in 1970 and director of creative services in 1971. He was elected to the board of directors in 1973, named executive VP in 1975, vice chairman in 1980, worldwide chief creative officer in 1981 and chairman of the New York office in 1986. He was elected chairman-ceo in April, 1989. And though everyone had enjoyed good times in the 1980s, things changed just as he took over the company.

"The Friday before I took over, Lou Hagopian, who had this job before me, got a call saying we lost Burger King," Mr. Siano recalls. "So that's how I started that Monday morning-it's still going on. You can write a book about Burger King changes."

But he seems to thrive on riding this particular roller coaster. During the last turbulent year a small investor group including Mr. Siano, top Ayer executives and former Saatchi & Saatchi Europe adman Richard Humphreys acquired a stake in Ayer. In November, one of Ayer's largest accounts, AT&T, called for a review, resulting in Ayer losing its lead agency status to Foote Cone & Belding. In February, Mr. Siano relinquished his ceo post. Ayer Vice Chairman-Chief Operating Officer Thomas Maxey, 56, retired and his duties were assumed by Chief Financial Officer Glenn Corlett. Patrick Cunningham, 50, agency vice chairman-creative director, became president-ceo of the New York office.

In an interview in his New York office with Crain Communications Corporate Features Editor Sandra Pesmen, Mr. Siano discussed Ayer's turbulent last year, its attempts at merger and its future.

Ms. Pesmen: Ayer has just gone through some highly publicized personnel changes. How is that working out and how do you see them benefiting the agency?

Mr. Siano: The real change that's been made is that Pat Cunningham (50, former agency vice-chairman-creative director) became president-ceo of the New York Office. Although he's reorganizing the agency, his main focus, and that of his staff, is on tending to present businesses and growing those businesses, because we see enormous growth potential in the accounts we have. They are multi-agency clients who spend 15% of their ad budgets with Ayer, so the other 75% is potential business. We anticipate growth through new products and new technologies with present clients such as AT&T, P&G, Gillette and others. New business is wonderful, but the reality is, we live and die-and our reputation lives and dies-on what we do for our present clients. So the new team in the New York office will be focusing on that.

Ms. Pesmen: How about other changes, such as Vice Chairman-Chief Operating Officer Thomas Maxey retiring and Chief Financial Officer Glenn Corlett taking over his duties?

Mr. Siano: Tom's been talking about retiring for more than a year because he's interested in doing other things, such as teaching. His role had been supporting the administration of the agency, really helping me on the business side, although he also functioned on the DeBeers account in an important manner. Now he feels it's time to do something else. His resonsibilities have been handed over to Glenn. Glenn's still chief administrative officer, but he's going to take on more resonsibility of that operating role in terms of job expansion, reoganization to simplify management with fewer layers. Glenn came from the financial side and has great potential at Ayer so we wanted to give him those new opportunities.

Ms. Pesmen: How have the changes affected you?

Mr. Siano: I'm still chairman and Pat will report to me, but basically he is running New York and I'm not going to have to deal with it. My job now will be to spend time with Richard (Humphreys) looking into the broader scope of national management. We'll be looking together at future management possiblities. We'll be looking at such issues as how we can expand Ayer Chicago, which reports to the national management.

Ms. Pesmen: Now that plans to merge Ayer with Hal Riney's agency are ended, is Ayer looking at any other possibilities?

Mr. Siano: Our national management team is committed to strengthening Ayer domestically, so obviously we're open to whatever happens, but we don't have anything in mind at this stage. We're open to any possibilities, committed to building New York and the agency domestically, so obviously we're open to above-the-line agency and below-the-line type business, but we have nothing new at the present time.

Ms. Pesmen: How did the original concept of merging come about?

Mr. Siano: When I took over and began looking at what we needed to expand, to keep good people and grow, I was hoping we could make some form of deal that would allow us to remain private. My feeling was we needed some form of merger that would have mutual benefit in terms of offices, clients, creative mission, whatever. We talked to a lot of (agencies), but none had a style that would work with ours and chemistry was another factor. We wound up with the possibility of merging with Ketchum because it was independent and had a practically non-existent New York office but had a very strong presence on the West Coast and a good PR business.

Ms. Pesmen: Did that come close to reality?

Mr. Siano: We were close but we hadn't yet made a final decision when we got a call from Richard Humphreys in London. He'd been reading about us and Ketchum and asked if there was an interest in talking to him. I said not necessarily, unless it was something that made even more sense (than Ketchum). He knew I was going to be in London and asked if I'd have lunch with him. We did, and that's when he told me of his interest and that he was representing a group of investors who were looking for a strong agency brand they could help build.

Ms. Pesmen: You've never said exactly what the partnership ended up, what percentage do they have?

Mr. Siano: No, because we are a private company. But the stake is substantial-a slight majority-and no one person owns this majority. I have a significant stake in the partnership and so do Richard (Humphreys) and other top Ayer executives.

Ms. Pesmen: What changes occurred after Mr. Humphreys and his group joined Ayer?

Mr. Siano: We began to solidify management (and) we were looking at the possibility of another venture that would underscore Ayer's image as a highly creative agency despite our size. We didn't want to just add on or borrow someone's else's identity. We wanted to find an agency with a creative reputation and a culture like ours that would immediately signal where we were trying to go.

Ms. Pesmen: What other resources are you considering?

Mr. Siano: When we first began looking into our needs, we began to talk about other possible ventures. One was direct response, and we decided we wanted to improve our direct capabilities by linking up with an agency with an expertise, attitude and personality we like. We started to do some work with Ross Roy for AT&T. They thought creatively. We were were impressed with them and thought they might be an interesting group. We talked, got together and thought we had the right chemistry, so we went into a 50-50 venture with them. It took place officially in October, 1993 and is called "Worldwide 1 on 1."

Ms. Pesmen: Do you have new plans for projects?

Mr. Siano: We're a lot bigger and growing and looking very strongly at the potential of AT&T Direct. AT&T spends more money in direct resonse than they do in above-the-line advertising. It's a major category in which we participate but in a fairly minor way compared to the other agencies. In this case, the (Ross Roy partnership) gives us more capability, so our potential for growth there is great.

Ms. Pesmen: What is Ayer's position with AT&T now?

Mr. Siano: AT&T is still one of our biggest and best and most important accounts. AT&T's relationship with Ayer is as strong as it ever was and will continue to be. AT&T executives will tell you our position with them is extremely significant and we are one of their most important creative resources.

Ms. Pesmen: How did you feel about your presentation?

Mr. Siano: We thought our meeting, which was next to the last, went extremely well, and they applauded at the end of it. They told us our people did a great job, then they went to FCB. Obviously FCB gave them an idea that they thought meshed with what they were trying to do and so they were going to go that way.

Ms. Pesmen: The public got the impression they were in and you were out.

Mr. Siano: At the time the press immediately said "Ayer losing $200 million.*.*.blah, blah, blah." That's not the way AT&T operates.What happened is Ayer lost the lead position to execute this new campaign. FCB has come from a very low level into a much higher status of executing this campaign in a major manner.

Ms. Pesmen: Did you feel you'd lost the major part of that account?

Mr. Siano: No. At the end of it, sure, we lost some lead business because (AT&T) had to consolidate their media dollars to launch this new program. But many people don't understand we have three AT&T divisions: corporate, consumer products and long distance. In the long distance division, we retained close to 75% of our original billing. Consumer is still ours and corporate is still ours and doing very well.

Ms. Pesmen: Are you saying you feel in the long run, the AT&T review was not a severe blow to Ayer and that AT&T will remain an important client?

The AT&T thing was more of an ego blow to whatever degree.

Ms. Pesmen: Does Ayer expect to get any new clients?

Mr. Siano: Yes, we have a lot of things in the works, particularly in Chicago. That is a particularly feisty agency and they're already doing great things. They just won Zurich-American Insurance Group, one of the largest insurance companies in the world. There is a great deal of pro-activity at that agency. It's a non-beaurocratic highly entrepreneurial creative resource, headed by Dean Proctor, that's just being discovered in its market. In fact, Ayer Chicago was just named agency for Wolverine's Work Boot and Wilderness brands. Also, Ayer Chicago has a number of other excitiing brand and strategic initiatives at Leaf Inc., which is Ayer Chicago's largest client.

Ms. Pesmen: What do you think is causing this flurry of business?

Mr. Siano: I don't know if it's the change within the agency, but I believe there's a sense of something happening, a happy rebirth after 125 years.

Ms. Pesmen: And what will the future hold for you and for Ayer?

Mr. Siano: For whatever time I have left in this business, win or lose, we're going to try and do something that's real with some substance behind it. I'm not going to leave it-with whatever creative time I have left-without trying. When you consider this brand has survived 125 years, which is older than almost every client we have, you realize its already lived longer than 99% of agencies will live because we always do things right. We try and use this little bit of integrity to preserve and enhance what I think has been a great brand. It deserves more than it now has and, hopefully with a little push, something better will happen.

Ms. Pesmen: How would you like to be remembered?

Mr. Siano: I've been personally involved with a lot of good ideas that I think will live, like "Reach out and touch someone." That became a big idea and it ran for years. Another was for the U.S. Army, "Be all you can be." I didn't create the advertising line but I was part of launching it with a number of other terrific people and that idea still exists. I don't know how anyone could ever beat it because it's so personal. I would like to be remembered for that kind of creative work.

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