Cockfield, Brown & Co.

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Founded by Harry Cockfield and Warren Brown in Montreal, 1928; became a pioneer in market research services; suffered sudden bankruptcy, 1983.

Cockfield, Brown & Co. was established in Montreal in December 1928 by Harry Cockfield and Warren Brown. Each brought with him a number of clients from his previous agency, and billings in the first year were a respectable $2 million. A second office in Toronto opened in 1929.

In 1930, Cockfield Brown became Canada's first agency to develop an extensive market research capability, forming a commercial research and economic investigation department. The agency's marketing studies combined desk and field research. In the words of a company officer in 1930, Cockfield Brown's research program sought to "transform advertising from a haphazard adjunct of high-pressure salesmanship into a scientific and essential function of modern business."

During the Depression, Cockfield Brown also succeeded in securing many new clients. Among the more prominent companies to sign on were Dominion Securities Corp. (1929), Dominion Textile Co. (1930), Great-West Life Assurance Co. (1930), Molson (1930), Bell Telephone Co. of Canada (1931), Massey-Harris Co. (1932), Royal Bank of Canada (1932), Welch's Grape Juice Co. (1932), Canadian Goodrich Co. (1933) and Gruen Watch Co. of Canada (1936).

Capitalizing on its research expertise, the agency forged close ties with the governing Liberal Party. In 1944, Cockfield Brown beat out MacLaren Advertising for control of the party's national English-language advertising. That year, Cockfield Brown executive H.E. Kidd (who would become Liberal Party secretary in 1949 while still working for Cockfield Brown) coordinated the first-ever opinion survey in an electoral district.

Also in 1944, the agency conducted a national opinion survey to test the appeal of party slogans. Most significantly, in spring of that year it supervised a series of 43 opinion polls in Ontario electoral districts to assess Liberal support. The surveys constituted the first uses of polling by a Canadian political party and were pioneering examples of political marketing.

In the 1945 election, Cockfield Brown handled radio, newspaper and poster advertising for the winning Liberal Party. Afterward, the agency worked closely with Liberal officials, in the process securing millions of dollars in advertising contracts before the party lost office in 1957.

Also in 1945, Cockfield Brown became the only Canadian agency to be listed in the first annual agency rankings compiled by Advertising Age. The company ranked No. 29 out of 51 large and midsize agencies, which were otherwise all based in the U.S. In 1948, it became the first Canadian agency to surpass $10 million in billings.

By the late 1950s, Cockfield Brown had grown significantly, ranking consistently among the top five agencies in billings (its 1958 billings topped $26 million). Its clients included such prestigious companies as Canada Packers, Imperial Oil, Lever Bros. and Merrill Lynch. The agency employed a staff of nearly 500 in its Montreal, Toronto, Winnipeg and Vancouver offices.

Mr. Cockfield died in 1942, but Mr. Brown continued to be active in the agency, remaining its president until 1968. In 1956, the Association of Canadian Advertisers awarded him its Gold Medal.

At a time when other agencies were growing, Cockfield Brown's fortunes began a downward slide; its billings remained unchanged between 1958 and 1964. Although it still secured the $6 million account for Montreal's World Fair Exposition in 1967, the agency faced greater competition from rivals Vickers & Benson and MacLaren, which in 1960 became Canada's largest agency.

In 1969, Cockfield Brown became the first Canadian agency to go public. It issued shares at $7 each, but the stock soon fell in value. In 1970, Cockfield Brown reported $34 million in billings, $5 million in revenue, but only $361,000 in net profits. By 1977, net earnings had dropped to $172,000. By the late 1970s, approximately 70% of the company's shares were in outside hands, leaving it a ripe candidate for a hostile takeover.

A chain of events culminated in Cockfield Brown's insolvency in 1983. In 1980, Peter Hunter, owner of a smaller ad agency, offered to merge with Cockfield Brown, but was turned down. A year later, John Francis, president of Calgary-based Williams & Johnson, bought 22% of Cockfield Brown in a bid to merge the two agencies, but he, too, was rejected. Meanwhile, another group formed by healthcare conglomerate Extendicare vied for the agency.

Messrs. Hunter and Francis joined forces in October 1981, together controlling 44% of Cockfield Brown shares. Cockfield Brown executives in turn issued their remaining shares to Extendicare, giving it approximately 40% of the company's stock.

At a bitter meeting of agency shareholders in February 1982, the Hunter-Francis forces seized control of the company, which prompted the immediate resignation of the board. Incredibly, Extendicare, which by then owned 43% of Cockfield Brown, was not represented on the board.

This takeover sparked the departure of many major and long-standing clients, including Gilbey Canada, Imperial Oil, Bell Canada, Molson and, eventually, Canada Packers, a 53-year client. In March 1983, the company released its 1982 annual report, showing a net loss of $474,300. Clients began withholding payments to Cockfield Brown, fearing it would go under before paying its media bills. Soon afterward the company's banker refused to honor its line of credit and payroll. Cockfield Brown's directors resigned, and in May 1983, one of Canada's oldest and largest advertising agencies filed for bankruptcy protection.

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