Clare Beale on Advertising

Why the whole industry should be raising a glass to AMV's success
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The Independent Online

Name an ad agency. Any one. If you work in the business, a dozen names will instantly present themselves. If you don't work in advertising, compiling a decent list will be a challenge. Ad agencies, quite rightly, are rarely famous. Certainly they should be shadowed by their clients' brands and if they're good their work. When agencies become famous in their own right (Saatchi & Saatchi, Eighties-style) chances are there's trouble ahead.

So if you're not an adlander you might well struggle to name the UK's largest agency. Abbott Mead Vickers has never sought fame for itself but over the 30 years since the company launched it has become a beacon for great advertising for big clients. It hasn't tried to rule the world (though it is now part of the mighty BBDO international empire); its founders are limelight duckers; and it most certainly never considered buying a bank (as the Saatchis famously did).

Yet within three decades AMV has gone from a standing start to the UK's biggest agency, with the bluest chip clients and a reputation for decency and integrity that few other agencies manage to sustain.

The agency was launched back in 1977 by the now legendary creative David Abbott, and the account supremos Peter Mead and Adrian Vickers. Thirty years on and the three have moved on, leaving an agency of 300-odd people behind them to carry the flame and a legacy of some of the country's best-loved advertising. Think The Economist ("I never read The Economist." Management trainee. Aged 42), BT ("It's good to talk"), Guinness, and the old Yellow Pages work (remember "Fly Fishing by JR Hartley?").

If there's a secret to AMV's success it's probably about building long-term relationships with clients, growing with them, engendering deep mutual trust, and latterly getting smarter at being commercially savvy. The agency's current chief executive, Farah Ramzan Golant, is a perfect mix of AMV's principled heritage and the sharp business acumen of the former AMV chairman, Michael Baulk.

It's a rare combination of qualities these days, and it can be hard for agencies to keep clients for a couple of years, let alone a couple of decades. Yet all the indications are that AMV is about to finish the year on another high... pulling even further ahead of rival agencies. I can reveal that a string of wins across 2007, including Heinz, Birds Eye and NHS Direct, have added about 50m in business to AMV's tally, which is likely to see the agency end the year with billings topping 400m, around 100m ahead of the competition.

So there was plenty to celebrate when the agency's founders and staff gathered at Knebworth last week to mark the 30th anniversary of its birth. And a British born-and-bred agency topping the ad market is something the rest of the industry should celebrate too.

Funnily enough, I also suspect that few "real" people could name the world's biggest advertiser. Procter & Gamble owns some of the world's most famous and ubiquitous brands (parent of Braun, Bounty, Gillette, Tampax, Pringles and a fair chunk of the rest of the stuff in your cupboards) but not many consumers will have heard of the parent.

Once again P&G has been crowned top ad spender on the planet, shelling out an eye-popping $8.52bn on its advertising according to Advertising Age magazine. And P&G is not far shy of double the spend of its nearest rival, Unilever (Dove, Vaseline, Flora, Comfort), another name that's unfamiliar to many of us.

No surprise that P&G is the real Goliath, but the bad news for its agencies (of which there are, naturally, plenty) is that P&G's budgets grew by a modest 4 per cent year-on-year. For many of its agencies, P&G is a tough but banker client; any signs that budgetary belts are tightening will have a similar effect on its advertising suppliers.

Worse, the world's top 100 biggest ad spenders, which between them spent a massive 97.8bn on advertising, only boosted their budgets by a collective 1.1 per cent, compared to growth of 5.1 per cent in 2005 and 12.1 per cent in 2004.

US adspend was a real brake on overall growth, with spending there down 2.2 per cent; but with US clients driving so much of the world's ad market, the stats are a warning signal for the rest of the globe.

In part, the modest growth in spend on above-the-line media reflects a shift towards other forms of communication: direct marketing and web activity. In part, it also reflects the continued drive amongst the biggest advertisers to extract better value (through tighter negotiations, improved targeting, more efficient strategies) for their ad bucks.

Whether all this adds up to an impending collapse in the ad industry's fragile recovery is hard to call. Perhaps advertisers are just getting smarter at extracting maximum value from their budgets. One thing's for sure, though: the ad industry has an awful habit of talking itself into a downturn, and lack of confidence can breed caution can breed budgetary clampdowns. Time for some positive talking.

Another happy birthday last week: to one of the UK's best-known commercials production companies, RSA Films. RSA stands for Ridley Scott Associates, the company founded 40 years ago by the director now more famous for his Hollywood endeavours (Blade Runner, Gladiator).

Scott cut his teeth directing ads, and has no doubt inspired successive generations of creatives to dream of making the leap from 30-seconds to two blockbusting hours. His most famous ads include the 1973, sepia-toned Hovis commercial with the boy riding his bike through quaintsy streets to deliver bread, and at the other end of the cosy scale, the 1984 epic (called "1984") that launched the Apple Mac. Scott might not direct many ads these days (can anyone afford him?), but like Abbott, Mead and Vickers, his legacy lives on.

It's good to see a former ad exec wowing the City in a new guise. Stevie Spring, erstwhile boss of Young & Rubicam and chief executive of poster company Clear Channel, is now the chief executive of the specialist magazine publisher Future. Last week she unveiled a heartening story of financial recovery, turning a 36.7m loss in 2007 to a 9.2m pre-tax profit this year.

Considering that advertising all too often berates itself for not generating City-wise business people of the highest calibre, Spring has become a fantastic ambassador for her former profession and proof that adlanders can work fiscal as well as creative magic.

Claire Beale is the editor of Campaign magazine

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