DDB Worldwide

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Founded in New York as Doyle Dane Bernbach, 1949; went public, 1964; became part of DDB Needham Worldwide in merger of DDB, BBDO and Needham Harper Worldwide to form Omnicom Group, 1986; renamed DDB Worldwide, 1999.

Doyle Dane Bernbach came into being when Ned Doyle and William Bernbach left Grey Advertising to become partners with Maxwell Dane in his small agency. They changed the shop's name from Maxwell Dane Inc. and opened DDB on June 1, 1949, with 13 employees, all from Grey, and one client, Ohrbach's department store, also formerly at Grey.

Within five years, the agency's billings reached $8 million, it employed 67 people and had moved twice. In June 1954, it opened an office in Los Angeles to handle Max Factor & Co. and Ohrbach's, which was expanding to the West Coast; the new branch brought in about $1 million in billings.

DDB lost the $3 million Max Factor account in March 1958, but by then the agency had established a reputation for creativity and results. It had, for example, taken Henry S. Levy & Sons, a small Brooklyn bakery, and turned its product into the best-selling brand of rye bread in New York. The agency also had created ads that nearly tripled Polaroid Corp.'s Land camera sales to $65 million, and had made El Al Israel Airlines a competitor among trans-Atlantic airlines with an ad that ran once in The New York Times.

The essence of the DDB style was crystallized in its ads for Volkswagen, which it won in 1959. The campaign was so clear and timeless that it continued virtually unaltered when the redesigned VW Beetle was introduced in the late 1990s. The classic ads, with headlines such as "Think small," offered a procession of small but penetrating insights mocking traditional car advertising. Advertising Age later named it the best campaign of the 20th century.

The work for Volkswagen greatly enhanced DDB's creative reputation. While other agencies were following their U.S. clients overseas, DDB was serving a blue-chip German client in the U.S. In October 1961 the agency opened its first overseas office in Germany, a 50-50 partnership with Holzschuher & Bauer, a $5 million agency founded in Duesseldorf in 1949. A year later the German branch was named DDB, Duesseldorf, and handled VW business in Germany.

The agency celebrated its 12th birthday in 1961 by winning $6 million in business from American Airlines, which had considered DDB only two years before but passed because the agency, at $22 million in billings, was too small. Twenty-four months later, it had become a $60 million shop. In July 1964 as it opened an office in London and topped $100 million in billings, DDB, the 18th-largest agency in the U.S., announced a 25% initial public offering. At that time only two other agencies had gone public: Foote, Cone & Belding and Papert, Koenig, Lois.

The glory days

These were the glory days of DDB, with clients such as General Foods Corp., Gillette Safety Razor Co., Lever Brothers, Mobil Oil Corp., Ocean Spray Cranberries and U.S. Rubber Co. The agency was both envied and feared by its competitors, many of which were trying to copy "the Doyle Dane look."

The agency had started a revolution in advertising, and other shops jockeyed to hire key members of its creative staff. As creative executives from DDB moved up and down Madison Avenue, the phrase "creative revolution" moved from the trade press to national weekly magazines such as Time, Life and Look. People outside the industry learned to talk with expertise about ad campaigns, debating their merits and strategies as if they were sports teams.

In January 1963, Avis Rent a Car System left McCann-Erickson for DDB, which noted that Avis was second behind Hertz Corp. With disarming forthrightness, DDB pounced on this fact, telling consumers that a company that is No. 2 must "try harder." Avis CEO Robert Townsend hated this concept, but he stuck to his agreement with Mr. Bernbach "not to change a bloody comma." The Avis work became one of the agency's signature campaigns of the 1960s—second only to that for Volkswagen—and it increased Avis' revenues from $16 million to $110 million in three years.

In 1964, DDB was hired by the Democratic National Committee to handle the campaign of U.S. President Lyndon B. Johnson. Among the ads created by the agency was the "Daisy" spot, in which a girl plucked the petals from a daisy as if playing "He loves me, he loves me not" to voice-over that was the countdown to a nuclear detonation, implicitly asking voters whom they trusted to lead the U.S. through the Cold War.

Neither the Republican Party nor its candidate, Sen. Barry Goldwater, was mentioned in the ad, but they protested, and the spot was withdrawn. However that protest did not serve the party well. By rising to the bait, the GOP created an interest that resulted in the commercial being given considerable exposure on news programs and election documentaries.

Troubled times

By the end of the 1960s, however, the agency's glory days were fading. One of the most frustrating chapters in the shop's history opened in 1969 when Miles Laboratories moved Alka-Seltzer from Jack Tinker & Partners to DDB. The agency produced two masterpieces for Alka-Seltzer—"Spicy meatball" and "Wedding night"—only to lose the account in December 1970 to a new hot creative shop, Wells, Rich, Greene.

This marked a period of management changes as well. Although Mr. Bernbach continued as CEO, spiritual creative director, and teacher, Mr. Doyle retired in 1969, and Mr. Dane left in November 1971. Joe Daly had been named president in 1968.

The agency went into the 1970s with a string of high-profile account losses. In addition to Avis and Alka-Seltzer, Lever Brothers Co., Kitchens of Sara Lee, Quaker Oats Co. and Whirlpool Corp. left the agency, taking $30 million in billings with them. The agency made some solid acquisitions in Europe, but it also suffered several misguided forays into diversification that temporarily put it into the sailboat business (Snark Products) and the retail trade (Trade Mart).

To counter these moves, Mr. Bernbach looked to strengthen the shop's management team and also starting hunting for a merger partner. In 1976, DDB moved into direct marketing with the purchase of Rapp, Collins, Stone & Adler. Also that year, Mr. Bernbach turned 65, DDB's mandatory retirement age, and although he remained on the board, Mr. Daly became CEO.

While the European operation was expanding, the agency was discussing possible mergers with other shops, including Ally & Gargano; Wyse Agency; Needham, Harper & Steers; and Foote, Cone & Belding. But b before a deal could be settled, Mr. Bernbach died on Oct. 2, 1982.

Among the first things to change after his death was DDB's policy on cigarette advertising. The agency had won Benson & Hedges in April 1958 and later took on Alpine, both from Philip Morris Cos., but DDB dropped both accounts in 1961 because of a "mutual disagreement on policy." After that, DDB did not take on any other cigarette work, by order of Mr. Bernbach. But within eight weeks of his death, the atmosphere began to change at DDB. It readmitted PM and took on the Parliament cigarette account.

Other, more profound changes signaled a slow atrophying of the Bernbach spirit. One person alarmed by the trend had never worked at DDB: Keith Reinhard, at Needham, believed he was watching the agency that had inspired him turn into just another big ad factory. "My idea," he told Advertising Age, "was to get together with DDB for reasons of creative passion and bring Bernbach's ideas to life again."

Mr. Reinhard also had the interests of his own agency in mind as he contemplated a merger between Needham and DDB. Needham CEO Paul Harper had put together a global network for that agency on relatively little money, leading Mr. Reinhard in 1984 to drop "Steers" from his agency's name and rebrand the company Needham Harper Worldwide; but the agency ranked only 16th in world income. Mr. Reinhard envisioned that "DDB Needham Worldwide" would combine the geographic muscle of both agencies.

After sorting out the strengths and weaknesses of the two shops, Mr. Reinhard approached BBDO and DDB in the summer of 1985 to discuss a merger among the three. However, DDB lacked a strong incentive to merge, and by September talks were considered dead.

Completing the merger

In 1986, the situation changed. Saatchi & Saatchi targeted DDB for a takeover and on April 24 made a bid. DDB rejected Saatchi and at the same meeting approved the now-legendary deal that joined Needham, DDB and BBDO, with Omnicom as the holding company name.

Combined, the three agencies accounted for almost $4 billion in billings, despite losing almost $200 million in business due to conflicts among clients. Needham's Los Angeles office, for example, which had handled the $100 million Honda account, was sold so that DDB Needham could retain the $110 million Volkswagen business.

Mr. Reinhard, who was regarded as an inspiring leader, was named chairman-CEO of DDB Needham Worldwide. Second in command at the new agency was John Bernbach, Bill Bernbach's son, who was named president-chief operating officer.

Under Mr. Reinhard's leadership, DDB Needham set out to build its business. In 1987 DDB Needham Worldwide had $2.6 billion in billings; in 1990 it reached $4.6 billion. To further the commitment to creative excellence, many of the agency's executive slots around the world were filled with former creative directors. These new executives also had a mandate from Mr. Reinhard to break down any barriers separating former Needham and DDB staff members and to create an entirely new corporate culture.

In 1990, Mr. Reinhard instigated a new system of agency compensation. Under this system, dubbed "guaranteed results," the agency's payment was no longer based on the amount of media commissions it earned from a client; instead, financial remuneration was tied to the effectiveness of its advertising. By the late 1990s, about 20 of DDB Needham's accounts were participating in the guaranteed results program, and the move from media-based compensation to a more accountable fee structure was becoming more widespread throughout the advertising industry.

In 1995, DDB Needham Worldwide was named Agency of the Year by Advertising Age, which applauded the agency's memorable commercials for Anheuser-Busch's Bud Light beer and Frito-Lay's Rold Gold pretzels. The late 1990s saw more gains for DDB Needham. The Chicago office was one of the most successful in the global network, securing more than $400 million in new business, including H.J. Heinz Co., Montgomery Ward & Co., Sargento cheese and General Mills' Golden Grahams and Hefty.

The greatest triumph for DDB Chicago was its win of the $385 million McDonald's Corp. account from Leo Burnett Co. Mr. Reinhard, in particular, had been eager to recapture that business, which Needham Harper Worldwide had lost 16 years earlier. Confident in his ability to help spearhead a new creative record for McDonald's, Mr. Reinhard brought only one positioning line to the pitch: "Did somebody say McDonald's?" As he had predicted, the slogan became fodder for talk show comedians, and it helped to contribute to a turnaround for McDonald's. By 1998, DDB Needham was handling McDonald's in 47 countries.

International expansion

Although DDB Needham's account gains in the U.S. were impressive, much of the agency's growth following the merger occurred overseas. In 1988, DDB Needham had worldwide billings of $3 billion, with 35% outside the U.S.; in 1998, it had revenue of $11.7 billion, with 44% in non-U.S. business. That year DDB Needham Worldwide became majority investor in two other agencies, DM9 in Sao Paulo and Palmer Jarvis in Vancouver.

By 1999, DDB Needham was handling multinational advertising efforts for such clients as American Airlines, Johnson & Johnson, Michelin North America, PepsiCo, Sony and Volkswagen. That year, the agency officially dropped Needham from its name, continuing as DDB Worldwide.

In 2003, DDB Worldwide won the Royal Philips Electronics global advertising account; billings were estimated to be $300 million.

Later that year, the agency made an even bigger score when unit Heye & Partner, Unterhacing, Germany, won the global corporate branding assignment for McDonald's. The agency won in a shoot-out against 14 roster shops with the "I'm Lovin' It" tag that subsequently spread around the world.

The agency ranked sixth among all U.S. agencies in 2003 with revenue of $252.3 million, a 6.9% increase over the previous year. Worldwide revenue was $943.4 million, a 15.8% gain over 2002.

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