A Brief (sort of) History of Agencies

Ad Age publishes its first Agency Report, ranking agencies based on “Advertising Age estimates from data obtained in interviews with chairmen, presidents, new business vice-presidents, treasurers and other high executives of these firms.”

J. Walter Thompson Co. tops the ranking with 1944 worldwide billings of $72 million ($1 billion in 2019 dollars). That translates to about $11 million in revenue ($154 million in 2019 dollars) assuming a then-common 15 percent commission.

Ad Age’s rankings include 25 agencies with 1944 billings of $10 million or more. Just six agency names are still in use: J. Walter Thompson (now WPP’s Wunderman Thompson); Batten, Barton, Durstine & Osborn (now Omnicom’s BBDO Worldwide); Campbell-Ewald Co. (now Interpublic’s Campbell Ewald); Foote, Cone & Belding (now Interpublic’s FCB); McCann-Erickson (now Interpublic’s McCann); and Young & Rubicam (now WPP’s VMLY&R).

The Wunderman Thompson network’s estimated 2018 worldwide net revenue: $2.8 billion.

Dentsu appoints Hideo Yoshida as president. Yoshida becomes the company’s fourth president since its founding in 1901 as Japan Advertising Ltd. and Telegraphic Service Co. Dentsu’s influential post-war leader serves until 1963.

J. Walter Thompson becomes the first agency to surpass $100 million in billings.

William Bernbach and Ned Doyle leave Grey Advertising and open Doyle Dane Bernbach with Maxwell Dane.

Ad Age publishes a 38-page report on “Television—Infant Advertising Medium—Where It Stands Today.”

Emerson Foote leaves Foote, Cone & Belding, which he had founded with partners Fairfax Cone and Don Belding in 1943 as successor agency to the venerable Lord & Thomas. After departing FCB, Foote spent years at McCann-Erickson and then his own agency, Emerson Foote Inc.

Rosser Reeves, developer of the “Unique Selling Proposition” at Ted Bates, creates “Eisenhower Answers America” TV campaign for Dwight Eisenhower’s winning presidential campaign. This is the first time a presidential candidate buys TV airtime for brief spots rather than lengthy speeches.

McCann-Erickson buys Marschalk & Pratt, giving it two agency brands. In an editorial (“A New Type of Super Agency?”), Ad Age writes: “If the experiment works, the advertising field can look for the further development of ‘satellite’ agencies which would actively solicit accounts which other satellites—or the parent agency—can’t touch because of conflicts.”

TV ad revenue moves ahead of magazines and radio. TV household penetration passes the halfway point, with TVs in 55 percent of U.S. homes.

Agency Report now ranks agencies by domestic billing and international billing. J. Walter Thompson holds a commanding lead overall and internationally; BBDO is the biggest U.S. agency.

The American Association of Advertising Agencies and five media trade organizations signed consent decrees with the Justice Department prohibiting the trade groups from encouraging or requiring members to stick to 15 percent commission on advertisers’ media buys. The decrees, still in effect, helped pave the way for fee-based compensation, negotiated commissions and alternative approaches to compensation.

BBDO opens its first non-U.S. office, in Toronto.

For first time, Agency Report ranks agencies based outside the United States. Japan’s Dentsu is biggest non-U.S. agency.

Wunderman, Ricotta & Kline opens. Young & Rubicam bought the agency in 1973. It now operates as WPP’s Wunderman Thompson. Lester Wunderman, often called the father of direct marketing, died in 2019 at age 98.

McCann-Erickson President Marion Harper Jr. creates the first major agency holding company. “McCann-Erickson has reorganized again,” Ad Age says, “with the establishment”—on Dec. 27, 1960—“of a new parent company, Interpublic Inc.” The company has operated under the Interpublic name since January 1961.

Interpublic adopted its current name—“The Interpublic Group of Companies”—in January 1964, and other holding companies followed.

Harper died in 1989 at the age of 73. He was named posthumously to the Advertising Hall of Fame in 1998. Ad Age in 1999 called Harper “arguably the agency world’s most innovative empire builder of the 20th century.”

J. Walter Thompson leads Ad Age’s first ranking of the world’s biggest agencies (based on 1962 billings), followed by McCann-Erickson; Young & Rubicam; Batten, Barton, Durstine & Osborn; and Dentsu. As of 2019, Ad Age Datacenter ranked Dentsu as the world’s biggest ad agency.

David Ogilvy merges his New York agency with its London partner to form a single operating company, Ogilvy & Mather.

Wells, Rich, Greene opens its doors, led by its high-profile chairman, Mary Wells, and her two partners, Richard Rich and Stewart Greene. Its Alka-Seltzer ads are part of advertising lore: “Plop plop, fizz fizz,” “Try it, you’ll like it” and “I can’t believe I ate the whole thing.”

Jay Chiat & Associates and Faust/Day Advertising merge, forming iconic Los Angeles agency Chiat/Day (now part of Omnicom's TBWA Worldwide).

In its tally of “Ten Who Made Advertising News in the ‘60s,” Ad Age in January 1970 lists eight men, one woman (Wells, Rich, Greene’s Mary Wells Lawrence)—and “The Computer.” Ad Age writes: “Today, computers are everywhere on the marketing scene: In media research, go-no-go advertising decisions, credit cards, easy credit operations, payrolls—and on and on.”

Unilever sells 49 percent of its in-house agency network, Lintas (Lever International Advertising Services), to SSC&B (Sullivan, Stauffer, Colwell & Bayles), which had been its U.S. partner since 1962.

The top 60 U.S. agencies reduce payrolls by 1,561 people, an average of 26 employees per agency, as nation slumps into recession.

Publicis lists on the Paris stock exchange.

Interpublic buys Campbell-Ewald Co., long-time Chevrolet agency.

Ad Age names Cunningham & Walsh as first Agency of the Year. Cunningham & Walsh was acquired in 1982 by Mickelberry, a former meatpacking company that had sold the meats business and moved into advertising. Cunningham & Walsh was later bought by N.W. Ayer and shut down in 1987. Ayer closed in 2002. Mickelberry’s, meanwhile, lives on today as a brand of ham owned by a U.S. subsidiary of Japan’s Mitsubishi Corp.

Agency Report moves agency rankings to gross income—a measure of revenue—from billings because “most agencies recognize gross income as a more meaningful yardstick of performance.”

Kobs & Brady opens in Chicago. The agency starts with about a dozen people, including Howard Draft. Under his leadership, the shop evolved into DraftWorldwide and then Draft. Interpublic bought the agency in 1996 and merged it with FCB in 2006 to form DraftFCB, bringing together advertising and marketing services. The agency in 2014 took the name “FCB (Foote, Cone & Belding).”

J. Walter Thompson, long ranked among the biggest ad agencies, buys Hill & Knowlton, the biggest PR agency.

London’s Saatchi & Saatchi buys New York’s Compton Advertising, which later would be folded into the Saatchi & Saatchi agency.

Ted Bates vaults into No. 2 worldwide and U.S. ad agency slot after its 1981 acquisition of William Esty Co.

Wieden & Kennedy opens in Portland, Oregon, with Nike as its first client.

New York’s Dancer-Fitzgerald-Sample sells ownership in 13 European agencies to Dorland Advertising, a unit of Saatchi & Saatchi.

Doyle Dane Bernbach of New York and Needham Harper Worldwide of Chicago merge into DDB Needham (now DDB) and simultaneously join with BBDO to form Omnicom Group, which opens with some of the most prized creative agencies in the business.

Saatchi & Saatchi Co. counters the Omnicom rollup by acquiring Ted Bates Worldwide. This comes on the heels of the Saatchi brothers’ early 1986 acquisitions of U.S. agencies Dancer-Fitzgerald-Sample (which would become part of the Saatchi & Saatchi agency) and Backer & Spielvogel (which merged with Ted Bates). Backer Spielvogel Bates Worldwide shortened its name to Bates Worldwide in 1994.

Saatchi & Saatchi Co. changed its name to Cordiant in 1995. Cordiant in 1997 split into two companies, Saatchi & Saatchi and Cordiant Communications Group (parent of Bates). Publicis bought Saatchi & Saatchi in 2000. WPP acquired Cordiant in 2003 and divided up Bates among other WPP agencies.

FCB and France’s Publicis form European agency network alliance.

WPP, led by Ogilvy and J. Walter Thompson, topples Saatchi & Saatchi as the world’s biggest agency company. But the hefty price tag for Ogilvy led WPP to borrow heavily just as the economy and agency business sank into recession. In 1990, a profit warning causes shares to plummet 66 percent in just four days. WPP’s stock plunges 96 percent from a 1989 peak to its 1992 low ($2.50). The outside auditor in 1991 casts doubt about WPP’s ability to remain a going concern. WPP in 1992 restructures its $1 billion in debt.

Valentine-McCormick-Ligibel opens in Kansas City, Missouri. WPP bought VML in 2001. At the time, VML had about 100 employees and $16 million in annual revenue. WPP in 2018 merged VML with Young & Rubicam, founded in 1923, to form VMLY&R.

Ad Age calls it “the year of the internet.” The first banner ad runs—an AT&T ad placed by Modem Media on HotWired, a website sibling of Wired magazine.

The web gets the buzz, but Agency Report notes traditional media still rule: “The three big mediums for agency billings—network TV, spot TV and magazines—rose 9.2 percent, 15.2 percent and 11.5 percent" in the U.S. in 1994.

Omnicom buys minority shares in six interactive marketing agencies including Agency.com, Organic Online and Razorfish. The company in 2010 divvied up Agency.com into other Omnicom agencies. Organic continues today as an Omnicom digital agency. Razorfish is now folded into Publicis-owned Publicis Sapient.

Euro RSCG Worldwide, France’s biggest agency group, changes its name to Havas Advertising, adopting the name of the French agency that had served as the nucleus of Euro RSCG. Havas continued to use the name Euro RSCG as an agency network name until rebranding the network as Havas in 2012.

Where did the name Euro RSCG come from? Euro RSCG was formed in 1991 when France's Eurocom, a unit of French media firm Havas, bought French agency network Roux Seguela Cayzac Godard.

Agency companies went on a shopping splurge this year, buying more than 150 U.S. ad agencies, marketing services companies, PR agencies and media agencies. “The big are getting bigger for good reason,” Agency Report says. “Business is booming.”

Among the acquired: Hill, Holliday, Connors, Cosmopulos and PR agencies Shandwick and Golin/Harris (Interpublic); Hal Riney & Partners (Publicis).

MDC Communications (now MDC Partners) enters the ranking of the world's 50 biggest agency companies after a series of acquisitions including Minneapolis shop Colle & McVoy.

Wells BDDP—formerly Wells, Rich, Greene, a defining agency of the 1960s “creative revolution”—closes after account and staff defections.

WPP buys Young & Rubicam in all-stock transaction worth $4.4 billion based on the value of WPP stock at the deal's closing, the biggest agency acquisition to date. Y&R at the time was hardly the industry’s hottest agency, but the deal included other valued properties such as Wunderman.

Publicis buys Saatchi & Saatchi.

Leo Group (Leo Burnett) and MacManus Group merge to form Bcom3 Group with backing from Dentsu.

“At last count, more than 300 U.S. agencies have been consumed since the turn (start) of 1999,” Agency Report notes in April 2000. “Omnicom … gained more than 20 agencies during this period; Interpublic … consumed more than 30.”

MarchFirst (launched as an agency rollup on March 1, 2000), Digitas, iXL, Grey Interactive and Sapient rank as the biggest U.S. interactive agencies as dot-com boom goes bust.

Bcom3 closes N.W. Ayer, a once-mighty agency founded in 1869. Later in the year, Publicis completes acquisition of Bcom3, including Leo Burnett and Starcom MediaVest.

Interpublic reveals problems with its internal accounting, setting the stage for a Securities and Exchange Commission inquiry, a series of financial restatements and a wrenching period of change in management and the organization. Standard & Poor’s in 2003 downgraded Interpublic’s corporate debt to speculative or junk status. Interpublic in 2007 completed a plan to fix “material weaknesses” in financial controls, and the company in 2008 reached a settlement with the SEC. Interpublic didn’t climb back to an S&P investment-grade rating until 2015.

“Advertising and marketing services in 2004 regained a vigor not seen since the dot-coms bellied up in 2000,” says Agency Report. “A rebound in interactive helped prove what goes around comes around.”

Revenue for U.S. interactive agencies surges 20.2 percent.

Agency Report breaks out its first ranking of consolidated agency networks based on 2006 worldwide revenue. Japan’s Dentsu tops the charts, followed by McCann Erickson Worldgroup.

“It’s clear that digital services have become a way of life (or a way to avoid death) for agencies of all disciplines. … Of the more than 860 agencies that participated in the 2008 Agency Report, 60 percent broke out digital revenue.”

IBM Corp.’s IBM Interactive becomes the first consultancy to appear in Agency Report.

WPP edges past Omnicom to rank as the world’s biggest agency company based on 2008 revenue. WPP snared the top spot with revenue from Taylor Nelson Sofres, a market-research firm it bought in late 2008. WPP has held the No. 1 spot since then.

“The agency business has come back to life, with U.S. revenue jumping 7.7 percent as the domestic market led a 2010 worldwide rebound in advertising and marketing services. The standout performer: digital marketing, which accounted for 28 percent of U.S. agency revenue.”

Omnicom CEO John Wren tells analysts: “Fundamentally, I believe that anything that’s not digital will soon be digital or soon be very, very unimportant.”

WPP’s Wunderman tops Agency Report’s first worldwide ranking of digital networks.

Levy and Wren call off their wedding. The press release quotes the duo: “The challenges that still remained to be overcome, in addition to the slow pace of progress, created a level of uncertainty detrimental to the interests of both groups and their employees, clients and shareholders. We have thus jointly decided to proceed along our independent paths. We, of course, remain competitors, but maintain a great respect for one another.”

BlueFocus Communication Group makes its Agency Report debut as the world’s No. 17 agency company in the April 2014 report. It’s the first China-based agency venture to appear in the ranking.

Dentsu makes 45 acquisitions and investments in 2016, the largest number in its history, as it continues to build out Dentsu Aegis Network, its network outside Japan.

Martin Sorrell resigns as WPP’s CEO following a board investigation into an allegation of personal misconduct. Sorrell denies the allegation. He jumps back into the ad business with a new venture, S4Capital, that by year end had completed two acquisitions. “The objective,” Sorrell tells Ad Age, “is to get to a base of around $300 million of revenue in a fairly short period of time.” WPP’s 2018 revenue? $20.8 billion.

Consultancies, led by Accenture Interactive, for the first time account for five of the world’s 10 biggest agency companies in Ad Age Agency Report 2018.