They, not cigarets, were on Bernbach’s mind when he sincerely told O’Toole that “we have to make this happen.”
* * *
Austrian and his FCB opposite, Norman Brown, chief architects, looked at their plan and felt pride. Unlike so many marriages arranged on Madison Avenue, this would be a merger from strength, a merger of equals. The consummation date was set for the first week of May 1982.
Each agency billed about $1.150 billion. Combined, their billings would make them the second largest U.S.-based agency worldwide. Geographically, they were a near-perfect fit. Doyle Dane Bernbach had never made it in Chicago, FCB’s most important turf. And FCB needed a boost on DDB’s home ground, New York. Internationally, their offices complemented one another’s.
The stickiest wicket was Los Angeles, where FCB handled the Mazda account, a blatant conflict with Volkswagen. In deepest secrecy, FCB prepared blueprints for the sale of its L.A. office to the management. (Two years later, the idea would be revived when Needham Harper sold its L.A. office, agency for Honda, to clear the decks for its own merger with Doyle Dane Bernbach.)
Other account conflicts existed, but both agencies were prepared for fallout. On Doyle Dane Bernbach’s side, several of the conflicting accounts were shaky anyway, and one, Procter & Gamble, was everybody’s favorite “let’s-dump-’em” candidate.
Austrian would be chief executive officer of the merged operation. But ambition wasn’t the strongest propellant in Austrian’s forceful promotion of the plan. What Austrian sought was no less than total invulnerability to threats, or actualities, of client departures. Almost from the day of his move from Wall Street to Madison Avenue, Austrian perceived a vast inequality in the comparative power of clients and agencies. Brilliant financial strategist that he was, he looked for ways to regain the agency’s control over its destiny.
Once, such control had derived from DDB’s reputation as the only game in town for great advertising. Now its disciples were in practices of their own, all over the world. In any case, the creative product wasn’t Austrian’s area. He looked for other solutions.
Having rescued the agency from its disastrous non-advertising acquisitions, he restlessly explored the possibilities of selling various agency services to small agencies around the country. That, and other arcane concepts, were meant to provide sufficient income to stiffen backbones and reinvigorate a spirit of independence.
Austrian soon saw that the best protection of all was a client base broad enough to withstand a series of departures. But the process of winning new business was too slow, and the need too great, to go it alone. A merger with a big, successful agency—preferably headquartered in the Midwest—seemed the answer to Austrian. He looked at prospects, and talked to many, including Leo Burnett and Needham Harper, in the years that followed.
* * *
Bob Levenson watched for Bernbach’s arrival on the marble-and-glass executive floor one Monday morning in April, 1982.
“And I attacked. Because I couldn’t believe it,” he recalled later.
“I want to hear it from your lips,” he told Bernbach, “say it in your own words, what you feel about the cigaret business.”
Bernbach calmly replied with almost the exact words that Austrian had quoted to Levenson on Friday: “I’ve turned the agency over to a new group of people, and they are responsible for its destiny, its well-being. They can’t be slaves to a decision I made nearly 20 years before this.” So there it was.
Levenson: “And with that obstacle out of the way, Neil and Norm Brown were pushing pretty hard to make it happen. And I think the only thing that Marvin [Honig] and Roy [Grace] and I ever agreed on was that we weren’t really happy with the thought of working for John O’Toole.”
* * *
It would have been hard to find an agency leader more decent, thoughtful and intelligent than John O’Toole. (He would go on to become chairman of the American Association of Advertising Agencies.) O’Toole wrote charming and instructive staff memos, often reprinted in the press. He took positions—such as promoting a minimum five-minute length for political commercials—that gave the profession an air of statesmanship. He spoke often and engagingly at industry gatherings. And he accomplished one thing that so far had eluded Bernbach—he had just published a book on advertising.
But he hadn’t the passion that Bernbach had, the ability to set creative hearts on fire, to coax and cajole and nurture until his people brought him work that surprised themselves, ads that touched, and moved, and persuaded. Great advertising.
O’Toole had no pretensions on that score.
“I always felt that Doyle Dane Bernbach was doing superb work,” he told me later.”That kind of work was not incompatible with what we were trying to do. They were better at it than we were. And I was all for having that spread throughout our organization.”
* * *
O’Toole sensed, from the Saturday in March that he’d driven over to Austrian’s house in Old Greenwich for lunch, that things were right for the merger. “The numbers and everything else don’t mean as much as whether it feels right,” he said, “and it was feeling right to me. It felt good. And then, talking to Bill...”
It felt quite something else after an evening with Doyle Dane Bernbach’s top three creative guns—Roy Grace, Marvin Honig and Bob Levenson. A trio whose attitudes toward one another led a later CEO to describe them as “three nuts with hand grenades.”
They gathered, O’Toole and the three DDBers, in Levenson’s Park Avenue penthouse apartment, after work on Wednesday, April 28, the night before the board meetings scheduled to vote on, and presumably finalize, the deal.
O”Toole later reconstructed the meeting like this:
“They seemed very concerned that I would be the judge of their creative work. And I tried to assure them that this is not what I had in mind. I had other things to do. But that seemed to bother them. So I said, ‘Whoever is passing creative judgment on your work now will continue to. I assume Bill Bernbach does some of that.’ They kind of smiled and said, ‘Oh no, Bill doesn’t.’ So I said, ‘Okay, in that case continue to operate the same way you are now operating, and continue to report to Neil.’ At which point they told me that they didn’t report to Neil.
“At this point, I wasn’t smiling. A company has to operate in some sort of fashion that approximates a business. ‘Whom do you report to?’ “Nobody.’”
O’Toole was incredulous. They surely would have to report to somebody in a merged operation. Perhaps the head of the New York office. Perhaps the CEO. Somebody. “I was not going to face the shareholders or the financial community with some sort of bizarre commune. So that was not resolved when I left.”
Bizarre commune? These were Bernbach’s children—talented, egotistical, competitive, able to live and work under the same roof only because they were still working for Bernbach’s approval, whether or not they reported to him.
Roy Grace guilefully asked O’Toole a question that was “really sticking it to Levenson.
“John, when you go around and make your speeches, do you show commercials?”
“Sure, I show the best of Foote, Cone.”
“Then you would show some of our commercials, right? Take some of Doyle Dane Bernbach’s classic commercials and put them on your reel?”
Grace watched Levenson squirm. Levenson was DDB’s designated hitter as creative spokesman—the person who took the agency’s treasures and represented them. He did it well, but not very often.
“The thought of John O’Toole doing that with DDB’s work,” Grace chuckled, “I mean, you have to understand the sensitivity. It was more than salt in the wounds. It was very painful to deal with.”
“If that’s what Levenson did,” mused O’Toole years later, astonished that the creative spokesman role had underlain any of the hostility at the meeting, “it was a well-kept secret.”
The trio, allegedly testing for philosophical compatibility, went through a list of FCB’s accounts, ofte
n disparaging the work. “I didn’t take umbrage,” said O’Toole. “I just said, ‘Terrific, you can help us.’”
To Levenson, corned beef sandwiches became the metaphor for the encounter. The talk went on longer than they’d expected, and so Levenson’s wife Kathe called Kaplan’s Deli for sandwiches and beer.
Levenson: “The stuff came. And we were sitting around this brass table, and we unwrapped these foil packages. And I swear O’Toole looked at it like he’d never seen a corned beef sandwich before. And he started looking around for the silverware . . . He’s looking for tools, and we didn’t have any tools. Then he started looking at his watch a lot, and mumbled something about his driver had been waiting too long, and went out the door and disappeared into the night.
“Marvin and Roy and I sat around for a little while longer, finished the sandwiches, and all agreed that even without the corned beef sandwich episode, O’Toole was operating in a universe that we didn’t know anything about, and really didn’t want to know anything about . . . And I think we agreed we would get back to Neil the next day and tell him what our impressions of O’Toole were.”
O’Toole: “I think they had made their minds up to that [the corned beef metaphor] before I arrived. I frequently have sandwiches, corned beef and otherwise, at my desk. They were not buying, from the moment I walked in. And if one of them had decided to buy the merger, the other two probably wouldn’t have.”
Honig had walked O’Toole out to Levenson’s elevator before returning to the sandwiches. O’Toole, non-plussed, had asked Honig, “What just went on in there?”
He’d just attended a rather typical late-life Doyle Dane Bernbach meeting.
* * *
The rest of the story was a shambles. Austrian worked through the following day to soothe fears, allay doubts, give assurances, explain again why bigger was necessary in an economy increasingly multi-national. Bernbach could have convinced any of the doubters, but he’d recently come home from the hospital, where a quart of fluid had been removed from his lungs. His lawyer son, Paul, would represent him at the board meeting, and express his pro-merger position.
The board met late in the afternoon, and proceeded to argue until 3 a.m. without coming to a vote.
They could not agree on a name for the combined agency.
Roy Grace: “That was the illusion. You tell me that you have two billion-dollar companies who think they have good reason to get together who are not able to decide on the name?”
Six names in the hopper. Ned Doyle, Maxwell Dane, Bill Bernbach all still alive and on the board. Fairfax Cone dead but important in agency lore. Don Belding dead and less important. Emerson Foote a vestigial remain. O’Toole had proposed Bernbach & Cone, or Cone & Bernbach—”either way, the only two names that mattered.” Or, FCB, for Foote, Cone & Bernbach. Or any combination of initials. As long as it didn’t end up with six full names: Foote Cone Belding Doyle Dane & Bernbach. Or Doyle Dane Bernbach Foote Cone & Belding.
“Sounds like an insurance company,” said Roy Grace when the names rolled off that way. “So what’s wrong with an insurance company?” retorted Austrian, a response that lost him points with the creatives.
Every combination led to dissension. Initials? Bernbach’s name must not disappear. What about Doyle’s and Dane’s? Um, well. Foote Cone first? Then the world would think Doyle Dane Bernbach had been taken over. But Austrian would be CEO; FCB needed something to show it wasn’t being swallowed up. DDB/Foote Cone? Why should they get the names and we the initials? Who the hell is Foote anyway? Etc.
Paul Bernbach: “I walked out into the anteroom and called my father at home. He was home sick; he and my mother were both there. And I said, people are basically in favor of it, but the name has become a sticking point. And he said—he and my mother were both on the phone—‘Why don’t you call it FCDDB?’ I went back into the meeting and said he suggested that and was met with hoots and catcalls, because it sounds like Fuck DDB—which never would have occurred to my father or mother in a million years. But he didn’t even care if Foote Cone came first or if it was all initials. He cared about the health of the business, and frankly at that stage about the financial well-being of the family, and he thought if that would help secure his children and grandchildren, that was fine.”
At 3 a.m. they adjourned, exhausted, prepared to resume next day. But there wasn’t another meeting. For the next morning, the financial and advertising press began to call with questions about why Doyle Dane Bernbach’s stock had risen two points, a gain of 14.5 percent, in a single day after months as flat as a Long Island potato field. Were reports of merger talks with FCB accurate?
Security and Exchange Commission regulations force a response. Either “Yes, we’re going ahead with merger discussions” or “No we aren’t.” Austrian and FCB heads quickly opted for “No we aren’t,” recognizing that the many potential client conflicts could not be dealt with before a “Yes we are” would hit the press.
A mandatory 90-day cooling-off period followed. But it was all over.
Much later, Austrian and others rued the outcome. In retrospect, the two agencies were “a perfect fit.” The time was right, the numbers were right, the geography was right.
And the lack of enthusiasm by the creatives?
“They were opposed because they felt FCB’s product was so inferior to ours,” said board member Bob Pfundstein. “But a lot of these people were still living in the ’50s and ’60s. The quality of the work was still good, but nowhere near as sparkling as back then.”
19
Out in the Wash
“The time has come, the walrus said, to talk of many things.”
—Lewis Carroll
The failure of the Foote Cone merger brought about a flurry of “whither DDB” meetings, one of which sealed Paulson’s fate. It was an “off-campus” meeting on Friday, July 30, 1982, of the New York board. “The cheese board,” in the nomenclature of Gecova Doyal, the agency’s maitre d’, to distinguish what he served with drinks from “the shrimp board,” the international board.
Summer Fridays had a holiday air. The agency closed at 1 p.m., so the absence of top guns wouldn’t be noticed by any lagging troops.
The shrimp board, also known as “the geriatric board” to its few youngish members, had long since narrowed its focus to earnings. Whatever the subject, the context most often was its impact on earnings.
The cheese board, made up of key creatives, top account managers and department heads, dealt with the philosophical questions. They gathered at the Rye Hilton on this day, with this agenda:
l. What should the agency’s positioning be?
2. What should be the goals for our creative work?
3. Should we have a policy regarding the kinds of accounts we accept?
4. What should be our position regarding research as related to our creative product?
5. Why are we losing accounts?
* * *
Most of the members lived in Westchester or Connecticut, and came directly from home in relaxed weekend wear. None of the usual office distractions broke the flow of talk.
“What was most notable about the meeting,” recalled Bill Wardell, who set it up, “was how out of it Paulson was. Nobody ever talked to him. It’s like he wasn’t there. And I don’t think it was an out-to-get Paulson meeting, but it was one time when so much of what was said started making so much sense to so many people that a consensus evolved, and Paul was odd man out.”
The consensus on the agency positioning: “Creative work should be dominant; everything else should be support.”
On the goal for creative work: “The goal should be Great Advertising.”
On the kinds of accounts we should accept: “Those accounts that appreciate great advertising. We should exclude people like Procter & Gamble and other big package goods accounts that do that kind of advertising.”
On research as relates to our creative product: “The less research the better, and we should never vo
lunteer it unless the client demands it.”
On why we are losing accounts: “The major reasons identified were: l) personal political situations, 2) the passing of the guard in client offices, 3) failure to open another office, 4) creative work that was not well received by clients. It was agreed that many account losses could have been avoided by good ties at the top between agency and client, which would have enabled us to recognize imminent problems and take corrective action.”
* * *
Creative executive Mike Mangano remembered the meeting as “the same old bullshit. I just wanted the agency to be the Doyle Dane Bernbach of the ’60s.”
Nobody's Perfect Page 19
