Meet the Man Building the Omnicom of Brazil

Top Creative Is Collecting Agencies With Eye Toward Dominating Local Markets

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SAO PAULO, Brazil ( -- In a land where the top creative admen are treated like rock stars, Nizan Guanaes is the leader of the band.
Nizan Guanaes is building an Omnicom-like holding company in Brazil that he renamed ABC.
Nizan Guanaes is building an Omnicom-like holding company in Brazil that he renamed ABC.

Prone to reinventing himself, Mr. Guanaes is building an Omnicom-like holding company in Brazil that he renamed ABC at the end of last month after a prestigious local private-equity fund injected $40 million for a 20% stake in the group.

"I want to go on the stock market," says Mr. Guanaes, who is chauffeured around São Paulo in an armored car by an armed driver and jogs with a bodyguard at 7 a.m. -- not unusual precautions in a country whose leading adman, Washington Olivetto, was kidnapped for 53 days a few years ago.

If all goes to plan, ABC -- which stands for "Advertising," "Below the Line" and "Content" -- would be the first Brazilian marketing-services group to go public, probably sometime next year. São Paulo's stock exchange is up almost 40% this year amid Brazil's booming economy.

'A local Omnicom'
"I want to follow the model of a local Omnicom," Mr. Guanaes says. "I don't want to go to the U.S. or Europe. I want to be the big guy in the small markets, a local giant."

He estimates ABC is already the second-biggest marketing-services group in Brazil, after WPP Group. He plans to take charge of the newest area, content, himself.

Reinventing himself as he approaches his 50th birthday next May doesn't stop with work. After a lifetime of struggling with his size -- he used to call his mother to tell her how many Lions he had won at the Cannes festival, and she would ask, "But have you lost weight?" -- Mr. Guanaes shed over 130 pounds this year, almost half his body weight.

His new sleek stature matches his glamorous lifestyle. His second wife, Donata Meirelles, a stunning, engaging blonde, breezes in from the Milan fashion shows. She's a top executive at Daslu, a women's designer-brands emporium that covers an entire São Paulo city block.

Lavish digs
This year the couple moved into a São Paulo mansion once owned by Assis Chateaubriand, a 1940s press baron who was the William Randolph Hearst of Brazil. Impeccably decorated and vast enough for Mr. Guanaes to have multiple meetings in different living rooms, it is also a family home, with kids, a couple of small dogs, family photos and Brazilian art -- and three security guards (four at night).

Mr. Guanaes, once a high-school exchange student in Iowa, started his first ad agency, DM9, 18 years ago, when he was a top copywriter. He became one of Brazil's legendary creatives but always explored interests beyond traditional advertising. He masterminded election advertising for two-time president Fernando Henrique Cardoso's campaigns. In 1997, he sold a majority stake in DM9 to Omnicom's DDB Worldwide and left in 2000 to become CEO of IG, an early internet-service provider in which he'd invested.

Guanaes' popular campaign for Parmalat dairy has been updated.

He made a dramatic return to DM9 DDB two years later, after the São Paulo agency had bled talent and clients. He turned up at dawn, fired about 60 people, and rebuilt his former shop. Mr. Guanaes, who has a deeply mystical side, said at the time: "There's no escaping from destiny."

Then he began collecting agencies. He started Africa in 2002, inspired by the similarity between that continent and his Afro-Brazilian native state of Bahia. At the agency, where Mr. Guanaes has his office and is both CEO and creative director, African photographs hang on walls paneled in dark tropical wood. The agency's 10 clients include Philips, Ambev, Mitsubishi and Parmalat.

Mr. Guanaes' long relationship with dairy producer Parmalat illustrates the way Brazilian creatives tap into the country's popular culture and Brazilians in turn embrace advertising. A decade ago, Parmalat milk ads by DM9 DDB featuring adorable children costumed as milk-drinking mammals, called "Mamiferos," were so popular that Mr. Guanaes challenged an American reporter over dinner to find anyone in the restaurant who wasn't familiar with his campaign. In a table-by-table poll, diners could all describe the campaign and a related stuffed-animal promotion that became such a craze a truckload of the fluffy animals was hijacked. (Most of the diners, along with the waiters, also could sing the jingle from a beer commercial for another of Mr. Guanaes' clients.)

'Larger than life'
Now the "Mamiferos" campaign is back, at Africa. The agency hunted down the original cast, who are now young teens and struggle in a new campaign to squeeze into their childhood costumes. After drinking Parmalat milk, they're way too big, but they're touching the hearts of Brazilian consumers again.

A few blocks from Africa, DDB (the DM9 was dropped), run by CEO Sergio Valente, a gifted creative and Mr. Guanaes' protégé, has a very different vibe: all glossy white and glass in an open, multifloor, loft-like layout.
ABC holding company
Africa, DDB (minority stake), Loducca, MPM

B. Ferraz, New Style, Hello, Sunset, Reunion, Tudo

Stockcar, N/Ideias, Networks Properties: Nascar, Carnival in Bahia
Mr. Valente occasionally slides down a white fireman's pole next to his office to drop in on the creatives below. They've just solved one conundrum: how to make an ad for Hot Pockets work in leading news magazine Veja. The ad asks readers to tear out the all-black page and stick it in a microwave oven for 30 seconds to see pictures appear of the latest microwaveable-sandwich varieties.

Elsewhere in São Paulo, a below-the-line division is growing, with well-known soap-opera stars doing TV commercials.

(When Mr. Guanaes started Africa, he did his own TV spots, saying, "I'm Nizan Guanaes. I have a new agency. Call me.")

"Nizan is a larger-than-life figure," says DDB Worldwide CEO Chuck Brymer. "He's extraordinarily creative, highly energetic, and inspires others within DDB, not only in Brazil but around the world. His curiosity and his wide range of interests give him a perspective that's unique."

Mr. Guanaes sees expanding into what he calls the forgotten continents, Latin America and later Africa. Right now, he's focusing on content creation, with stakes in properties ranging from Nascar to carnival.

"It's not Nizan anymore," he says. "It's the era of ABC."

What? No media shops?

Brazilians like to say their country is different, and in some ways it is.

As ad spending slows in the U.S., Brazil's agencies expect total spending to grow by about 20% this year and next year.

Brazil is the only major market where media agencies are not allowed; media must be placed by a full-service agency. Brazilians feel that's helped spare creative shops from being marginalized by losing control of media channels.

Alexandre Gama, CEO of Neogama BBH, says non-Brazilians tell him, "You guys are so late, you're ahead."

Media fragmentation is in its infancy here. Rede Globo has half the TV viewing audience and about 70% of TV ad dollars. Editora Abril takes about 70% of magazine ad budgets.

And while marketers might like to see media agencies here, Brazilians' response when asked if that's likely is: "Of course not!"
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