Published on .

The Dutch advertising industry got started in the early 1880s with the founding of the first Dutch ad agencies, including De la Mar, which set up shop that year. However, the industry experienced its greatest growth during the 1950s, 1960s and 1970s, with many of the country's top agencies originating during the last of those three decades.

According to the Dutch government's Central Bureau for Statistics, there were more than 1,300 ad agencies in the Netherlands at the turn of the 21st century, and about 20 of those had annual incomes of $5 million or more. The 115 agencies that are members of the Dutch Association of Communication Agencies (VNU) account for 75% of ad industry billings, according to the association.

Industry practices

The mid-1950s and early '60s were turbulent times for the Dutch advertising industry. The business was governed by the Dutch Code of Advertising, which had been established in 1948 through collaboration among advertisers, agencies and newspapers. It decreed the standard agency commission (15%) and set up a powerful Council of Advertising that recognized agencies, settled disagreements and imposed penalties on organizations that violated tenets of the code.

The code also set up rules regarding the publication and calculation of circulation figures, disallowed rebates and required adherence to the prices set forth in a publication's rate card. The council had the ability to impose fines, and its rulings were accepted by civil court judges. All those regulations were intended to create stability in the industry.

In the 1950s, however, advertisers wanted to abolish some of the rules-namely those regarding the commission percentage-to enable them to negotiate ad rates. Ad spending was on the rise, U.S. subsidiary companies were setting up manufacturing plants in the country (220 foreign subsidiaries were based in the Netherlands at the time, with 42% from the U.S.) and retailing was growing, with 200 self-service stores in operation. There were 600 major advertisers, led by Unilever and its rival Procter & Gamble Co., and 76 recognized ad agencies.

By the mid-1950s, commission rates had become a contentious issue and had created bad feelings among newspapers, advertisers and advertising agencies. The controversy continued through the early 1960s, when all the parties decided to work together for the good of the industry.

Although codes of advertising governing the advertising business in the Netherlands have evolved over the years, the country maintains a strict set of regulations similar to the one it had adopted in 1948. The current rules, collectively called the Netherlands Advertising Code, have provided the foundation for industry self-regulation since 1974. The Advertising Code Committee enforces those standards. The Netherlands Advertising Tripartite, founded in 1977 and made up of advertisers, communications agencies and media—including their respective associations—oversees the code and dictates changes.

By 1961, the country's association of communications agencies estimated the advertising market at $158 million, or about 2% of the gross national income. Newspapers accounted for about 33% of the market, followed by direct advertising with 23% and business and professional publications at 13.5%. While there was no commercial radio in the country, the pirate station Radio Veronica accepted advertising and took over a significant share of the market. The success of Radio Veronica—amid much controversy and government threats of closure—foreshadowed developments to come in the emerging TV market.

By the mid-1960s, spillover of commercial TV from Germany and Belgium exposed Dutch audiences—40% of whom could receive foreign channels—to the concept of TV advertising. Meanwhile, in 1964 a pirate TV station operated by Reclame Exploitate Maatschappij (Advertising Operating Co.) moved its base of operations to an artificial island in the North Sea off the coast of the Netherlands. Called TV North Sea and run by a British company, the station reportedly generated more than $1 million in ad revenue before being seized by the Royal Dutch Navy. (The Dutch government had passed special legislation against commercial broadcasting targeted specifically at the pirate station.)

The programming of TV North Sea whetted viewers' appetites for more entertaining fare; the Dutch domestic TV schedule tended to be serious and often religious or political, with the two TV and two radio stations controlled by the country's dominant political parties, some of which had religious affiliations.

As a result of pressure from viewers and advertisers, the Dutch House of Commons (Tweede Kamer) passed a bill authorizing commercial radio and TV at the end of 1965. The bill stipulated the creation of a council for radio and TV advertising and a code for advertisers specifically dealing with broadcast advertising. Initially, a 15-minute-per-day period was set aside before and after newscasts for commercials; radio was allowed 24 minutes per day of advertising.

The advent of commercial TV and radio expanded the opportunities for advertising and enhanced the position of advertising agencies. Some of the leading agencies in the mid-1960s included Smit's, Prad, De la Mar, LPE Nederland and Van Maanen, all independent Dutch shops. By 1968, TV accounted for 14% of measured media in the Netherlands, and by 1989, more than 85% of homes had TV sets. Other important media outlets were newspapers, women's magazines (which reached two-thirds of adult females), trade publications (which numbered 1,200) and direct mail, which accounted for 33% of Dutch advertisers' budgets.

By the 1970s, much of the turbulence of the 1950s and '60s had subsided, but other challenges arose. Ad dollars moved away from print and toward commercial TV and radio; several newspapers merged or shut down in 1970 and '71. In 1972, the Dutch government authorized $9.6 million in funds to subsidize the industry for two years.

Meanwhile, with several new agencies starting up during the decade, competition was growing. This development not only raised the stakes in the battle for clients but also decreased agency profit margins. The number of agencies had grown from 114 to 150 between 1969 and 1972, while employees in the industry had decreased from 3,600 to 3,400 during the same period, suggesting that more competition had resulted in financial difficulties and layoffs.

The first personalized ad

In 1975, the Dutch market was the location for an advertising first. The November issue of the Dutch edition of Reader's Digest (Het Beste Uit Reader's Digest) carried a three-page back-cover gatefold and a facing page in which General Motors Corp., represented by McCann-Erickson (Nederland), introduced its new Opel line, marking what is thought to be the first attempt at a personalized ad.

The inside cover featured a letter to the subscriber, with five references by name scattered throughout the text, while the outside cover was a coupon imprinted with the subscriber's name and address. The issue was mailed to 350,000 subscribers.

The 1980s witnessed a continued expansion of the advertising industry, with leading agencies such as Kuiper & Schouten and Campaign Co. founded during this decade. In addition, many U.S. agencies set up their European subsidiaries in the Netherlands during the 1980s.

During the 1990s, ad expenditures grew at the fastest pace in Dutch history, with much of the increase attributed to new commercial radio and TV stations such as SBS 6, Fox and RTL 4 and 5. Advertiser demand was on the rise at the same time as available airtime was expanding.

Meanwhile, more business was coming into the country from abroad, as multinational advertisers increasingly chose Netherlands-based shops as their lead agencies for global campaigns, and the country gained a reputation for effective campaign concepts. Many observers credit commercials director Paul Meijer-whose work for Mazda, KLM, Sony and others via agency PMS&vW/ Y&R put Holland on the creative map.

By the 1990s, the Netherlands was becoming known for its technological sophistication, especially in graphics and video. Several ad agencies allied themselves with new technology companies in the late 1990s, including Benjamens, Van Doorn-Euro RSCG, which announced a merger with two interactive technology companies, Webnet and Cyberlab. The merged entity became known as Euro RSCG Interactive.

Many smaller, independent shops also began to attract clients because of their creative work, including Agency 180, founded in 1998 by former Wieden & Kennedy executives, and Strawberry Frogs.

Ironically, some of the smaller creative agencies with worldwide reputations are not considered Dutch by the locals. Despite their high profiles among international clients, they do not get mentioned in the trade press or win trade awards. In fact, there is a definite schism, with a portion of agencies specializing in international clients and the remainder focusing almost exclusively on work for the Dutch market.

In 2001, the top agencies in the Netherlands were TBWA Netherlands, with gross income of $55.6 million; Publicis, $53.1 million; Result DDB, $44.5 million; PSW&vW/ Young & Rubicam, $41.1 million; and BBDO Nederland, $40.1 million.

Most Popular
In this article: