Having evolved on an upward trajectory for the good part of a century, Clemenger BBDO isn’t about to rest on its collective laurels, it’s just getting started on the future.
Clemenger BBDO is the granddaddy of Australian advertising. While the agency is celebrating its 70th year in 2016, it wasn’t always the stalwart it is today.
The agency, which was started in March 1946 by John (Jack) Clemenger, is an iconic fixture of Australian ad land. It is one of the most awarded Australian advertising agencies still around and winner of the AdNews Agency of the Year accolade seven times – more than any other agency or group in the 30 years of the awards. Clemenger is recognised locally and internationally as a bastion of creativity and campaigns like Yellow Pages’ ‘Not Happy Jan’ is part of Aussie culture. AdNews named ‘The Boys for Bonds’ work Ad Campaign of the Year in 2015. But Peter Clemenger, son of the agency’s founder remembers when things were a little different.
“For many years we were the new boys. We seemed to have been around for a long time, but in 1946 there were a number of family–owned businesses that are no longer here – Basil Carden’s Carden Advertising [which later merged into George Patterson] and Hugh Paton’s Paton Advertising Service [taken over by his son Noel in 1946],” he said.
“So, for a long time our main aim was survival; I don’t know how many years that went on for.”
After Jack’s death in 1962, his sons Peter and John carried on as joint managing directors of the agency. Now 87, Peter is still actively involved in the business, holds a seat on the board and still makes an appearance in the Melbourne office two or three times a week, although he doesn’t deal in the day-to-day operations.
“I know a bit about how we got to where we are, but it’s not for me to pontificate about the future – let someone else do that,” he said when we sat down to talk about the agency’s 70th milestone.
Before meeting Peter, I was warned not to be fooled by his advanced years – he may be one of the last remaining gentleman of a bygone era of advertising, but behind his humble and understated demeanour, is a shrewd businessman who hasn’t lost his touch.
In its early days, Clemenger was built on making radio ads and evolved into a full-service shop with clients including Mercedes-Benz, KFC, Campbell’s, Pizza Hut, Yellow Pages and Just Jeans, with more recent additions, Myer and Bonds.
With 1700 people at its almost 40 businesses across Australia and New Zealand, Clems is one of the largest homegrown agency groups with revenue of $407 million in 2015 (9% year on year growth) and profit of $41.7 million after tax.
While the Clemenger name was born of an Australian, family-owned agency, a large part of its success has to be attributed to being part of a global network which added scale and offered the relative comfort and financial stability of a larger organisation.
In 1972, the family sold the first stake to global group BBDO. Peter suggested that choosing BBDO as its global partner was “a touch of luck” but his modesty belies the business decision.
“The theory was this,” Peter, a self-proclaimed pragmatist, explained “my brother and I at one stage each owned 50% of the business after my father died and if one of us was hit by a bus what would we do? The greater the success we had, the bigger the problem would become and so we decided to sell a third of the business to the staff and a third to an outside corporation. We wanted to spread the ownership so we didn’t face a disaster. It was a very hard decision to make, but it turned out to be the right one.”
Sharing the faith
Over the last seven decades, many of the agency’s peers and rivals have fallen by the wayside, but Peter and current chairman Robert Morgan believe part of what has kept the Clemenger shop going strong was allowing employees to share in the success of the business.
“My brother and I believed in sharing the success with the senior people we had here and we started selling part of the business to the staff in the 60s. It started with Peter Rankin and Peter Cooper. In the early days we didn’t even tell people who had shares with us what our profit was. They bought the shares in blind faith but I think it paid off,” Peter said with a wry smile.
More than 400 Clemenger staff currently have shares in the agency.
“I wouldn’t wish to compare what we’ve done with other agencies, but I think others made the mistake of not doing it. It’s perhaps one of the things I’ve been most proud of,” Peter said.
For a man whose leadership has helped build a $400 million advertising business, Peter Clemenger never planned to be in advertising at all – and didn’t believe he was particularly suited to it.
“I didn’t set out to get into advertising, I basically got pitchforked into it by my father.
At 16, I’d won a scholarship to go back to school in 1944, and at that stage my father was working for an agency run by Les Leesham. The Sunday before school started we had a picnic with them and I was told I would start work the next day as the office boy. You didn’t query your parents back then and I never went back to school, but it turned out rather well,” he explained.
“I enjoyed what I was doing and I certainly worked pretty hard and it would appear I’ve done reasonably well at it. But when I look back on it, if someone had said ‘will he make a success of advertising?’ The answer would have been ‘no’.
“I didn’t have too many of the attributes that people in advertising were seen to have.
Confidence and creativity – those things were seen to be important in an advertising career and I don’t think I had them. Confidence I’ve gained a bit over the years.”
Clemenger hasn’t all been success upon success. In the 1980s, the agency had an ill-fated and short-lived push into Asia, putting in $25,000 to help out an agency in Hong Kong run by an Aussie which saw the Clemenger name spread to the Philippines, Malaysia, Japan and elsewhere.
Without going into details of why it didn’t work out Peter said that “the best decision I ever made was selling it all to BBDO”, while also confirming
Clemenger hasn’t got eyes on international expansion. “There are a couple of Aussies who decided to tackle New York but we’ve got enough to do here,” Peter added.
Rewiring for the future
Reputation and heritage is one thing, but it doesn’t guarantee a successful future and Clemenger isn’t shying away from the fact it has to evolve. The story of Clemenger’s past and the 70 years it’s celebrating in 2016, belongs to Peter Clemenger, but the story of its future is currently being written by a whole new leadership team.
If you ask Rob Morgan, who has been chairman since 1998, if there’s a risk of relying on the reputation Clemenger has built up over the last 70 years, he agrees that there is.
Morgan holds monthly ‘future agency leadership’ meetings with a handful of execs that have been pinpointed as pivotal to guiding the agency through its next decade and beyond.
Among them, Chris Howatson, CEO of CHE Proximity, the data and analytics-driven media agency that this year expanded from Melbourne to Sydney, now with more than 50 people in the new office; Nicola Hepenstall, managing director of research agency, Hall & Partners Open Mind; creative chairman, James McGrath, and Nick Garrett, who took over as Melbourne CEO in November last year.
“The [future agency leadership] group is working on the overall offer, making sure that we’re modernising Clemenger and working out how we build the capabilities that we need. We’ve got to be open to new threats – we’re not spooked by them – but we don’t want to be ‘Ubered’,” Morgan said.
“I spend a lot of time worrying about if we are thinking forward and modernising fast enough or are we sitting on our laurels, but we’ve been good at bringing in new talent and disruptors. Stability is one thing, but the minute we sit back and think ‘we’re great’ then we’re gone. We’ve got new management in Brisbane and Wellington and those, including Nick Garrett and Chris Howatson, are challenging us as a group.”
For Garrett, the future of what agencies need to do is clear.
“It’s becoming pretty clear globally, and at a local level, that the disintegrated model isn’t working. Agencies will either become really niche and specialist at one thing or become very good at a lot of stuff,” he explained.
“Clients aren’t looking to have five or six agencies. They’re looking for one or two to be the best they can. We’re looking at the infrastructure of the Clemenger group and how we can bring all our specialist services like experiential and shopper marketing together in one place.
“To ensure that Clemenger [in the future] remains as good as the agency we inherited we have to rewire our systems and our culture. A large part of that is operational excellence. We have to fundamentally look at the infrastructure, the tech and the capabilities of the business to make sure we’re relevant in five years’ time.”
CHE Proximity will certainly play a role in shifting the group’s attention and its rapid growth over the past 6–12 months to become a national business that brings media back in-house has demonstrated that.
In Melbourne, Garrett (who joined from Colenso BBDO where he was managing director for six years) has spent six months reworking the structure of the agency and its specialist divisions. He isn’t backing away from the scale of the challenge the group faces and the need to be radically different in approach.
“Peter and many others since have left an amazing legacy for Clemenger BBDO, but we’re facing huge tectonic shifts in media in tech and what’s important for us at this moment in time is to keep up with change and get ahead of change.
That’s not a simple thing and it’s particularly challenging when you’re a big agency with a huge legacy,” he revealed.
“We’ve been a successful advertising agency and because of that we weren’t forced to evolve earlier, but we have a duty as one of the largest and most creative agencies to be ahead of the curve of change – we have to move faster and make bigger strides.”
Triple ‘the work’
Clemenger’s mantra has always been about ‘the work’. So much, they say it thrice.
“Creativity is the bedrock of our culture,” Morgan said, but in a world where innovation, digital, integration, cross-platform, user experience, data and the increasing interconnectedness of it all is creating a more complex landscape than ever, is it enough?
Paul Nagy, who has been ECD of Clemenger Sydney for the past five years, and lead creative at the agency’s Wellington office for another five prior, believes the “brilliance” of “The Work, The Work, The Work” is that it doesn’t need to evolve.
“The heart of the phrase revolves around our output, not how we get to it, that’s why the network has always been obsessively focused on that above all else. Will the way we get to the work change? Yes, constantly, but will our focus on ‘The Work, The Work, The Work’? Nope, because it’s all that matters in the end,” he said.
“Creativity and storytelling are still the most important things in effective communication, basically everything else has changed and we need to keep on top of it. We can never forget that our greatest strength is creativity. There’s loads of distracting, albeit exciting, technological advancements out there and all of them represent wonderful new blank pages we can tell our stories on, but it’s the story that makes the page special, not the other way around.”
Key to making that happen is getting the right people and Morgan explained that Clemenger has always aimed to have “an unfair share” of the best people in Australia.
“The best people might change in the nature of their skills, but our management mantra is ‘hire the best and get out of their way’. You can either hire smart or manage tough,” he said.
“We should be able to get the sort of people that are pioneers in building a new offer and fulfilling the needs of clients as they radically change. Whether that means capabilities in programmatic, media and content, data and analytics or a combination.”
For Nagy, it means structuring creative teams to be “super creative within constantly changing trends … having people who are constantly excited and knowledgeable about those dark arts.”
With that in mind, last year the agency also set up an internal gender equity taskforce to “foster a more equitable gender balance in senior leadership roles” according to the 2015 annual report and set a target of 40% female leadership by 2020. Emily Perrett, head of account management, is leading the charge.
Looking ahead, Peter said the business is in a long distance race and that it’s far from over.
“My view has always been that it’s better to think about the future rather than worry about the past. There have been agencies that have come and gone. Those that have catapulted up into the top echelons for whatever reason, but disappeared again,” he said.
“We’ve been going 70 years and we’re still at it. It’s not just important what you’re doing today, it’s what you’re doing tomorrow and the next day. It’s a long distance race we’re in – it’s the Melbourne Cup, not the Golden Slipper.”
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