While Everyone Else in Adland Zigs, BBH Zags

Invention Arm Aims to Fill Voids Where Consumers Are and Brands Are Not

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LONDON (AdAge.com) -- As the economic downturn worsens and agencies cut costs, Bartle Bogle Hegarty is doing something different: diversifying into products such as vegetarian meals and personal alarms.

Through Zag, the agency's brand-invention company, BBH's London office is creating its own brands and bringing them to market with joint-venture partners. The idea is to identify "brand lag" -- areas where consumers are active but there are few brands.
Pick Me: Targets carnivores who don't want to eat meat daily.
Pick Me: Targets carnivores who don't want to eat meat daily.

Zag launched in 2006, headed up by former Unilever executive Neil Munn, and its first U.K. brands are launching just in time to bolster the agency's growth. The agency recently opened a Zag office in New York.

These are not pet projects. BBH hopes that Ila personal alarms will make $35 million a year in retail sales within three years, and that Pick Me vegetarian meals will be a $15 million retail business within a year.

Unmet needs
Pick Me was created by Elizabeth Leath, a vegetarian publishing executive who devised a range of meat-free recipes her carnivorous family could also enjoy. Her husband coined the word "bi-tarian" to describe someone who likes meat but doesn't want to eat it at every meal, and that was the "brand-lag" space BBH identified. Although only 12% of people describe themselves as vegetarians, 86% of adults eat meatless meals at least once or twice a week.

The Pick Me range of readymade meals is manufactured by Boutique Foods Group and sold in 800 Tesco stores across the U.K. It includes Nutballs with Nuts (and Herbs), Cheeky Chunky Chili, Shepherd's Pie (Without the Sheep), and Pea and Mint Risotto.

Ila Dusk is a personal-security brand named after the Hindu goddess of speech and developed with security firm Locca. The "brand lag" here was the knowledge that some women feel unsafe on the street but have few options for protecting themselves.

The first product, an alarm that emits a loud woman's scream, sells for $30 in an exclusive deal with Marks & Spencer until Christmas.

As well as providing extra revenue streams for BBH, Zag takes agency staffers out of the creative bubble and into the world of business as experienced by their own clients.

New challenges
"We have two exciting, differentiated brands; we have like-minded partners who are providing the operational muscle; and we have the support of two of the U.K.'s biggest retailers," Zag CEO Mr. Munn said. "It's exciting, it's unpredictable, it's all the things you'd expect from an entrepreneurial business trying to find its way."

Pick Me, for example, had packaging difficulties at launch when the cardboard turned soggy. Zag quickly devised new packaging and got it into stores overnight.

Nigel Bogle, founder of the agency and Zag, said: "Our experience of developing and launching our own brands will enable us to have more empathy and commercial awareness of what our clients go through. There is no guarantee that we will succeed every time, but the trying creates value in itself."

Anyone at BBH can contribute to -- and profit from -- the Zag division. (The agency does not break out its revenue.) There is an annual competition for the best new idea, which was won this year by a pregnancy-nutrition brand. The winner's prize money of 2008 pounds (upped to 2009 pounds next year) is suspended in a glass ball in the agency's reception area until it's claimed.

For the team that gets a Zag brand to market, there is another cash bonus -- or, even better in these tough times, a job. The Ila assignment was given to college students, and the winning team is interning at BBH.

Zag is working with more partners, including fragrance company Givaudan and publisher Penguin. The division has also taken an equity stake in a food brand called Mrs. Beeton and is working with private-equity houses offering brand-risk-assessment services.
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