Local Ad Exec Decries Brand Bias

March 11, 2003
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GRAND RAPIDS — Something has been simmering on the back burners at many local advertising agencies for more than a decade.

But now the shop with the highest billings in town has decided to stick a fork in it and serve it up for everyone’s consumption.

The beef is that major area companies, known as big brands in the ad business, not only don’t use local shops in their big campaigns — they don’t even let local agencies bid on them.

“The first thing we’re going to do is stop being so quiet, which really requires us to stop being so satisfied,” said Bill McKendry, who started Hanon McKendry Inc. here in 1994.

To support his point, McKendry told the Business Journal that Meijer uses a Milwaukee firm, Steelcase uses a Minneapolis agency, and Bissell works with one in Detroit. He said other area businesses do the same, and that out-of-town connection isn’t just a recent ad fad.

For instance, before the housewares manufacturer went with a Detroit agency, Bissell used shops in New York, Chicago and Minneapolis. Before the office-furniture maker signed with a Twin Cities agency, Steelcase used ad firms in Virginia and San Francisco. McKendry added that Meijer was currently reviewing agencies, reportedly none of which are local.

“The point is that many brands in this marketplace don’t really consider local agencies for major marketing initiatives and big branding campaigns,” he said.

For the record, McKendry isn’t claiming that local big brands don’t do any work with local ad agencies. He said these large firms do use local shops for smaller projects that might require an ad run or some brochures, just not for the big jobs. And he feels he knows why.

McKendry said big brands don’t believe the people here are as seasoned or creative as those in New York or Los Angeles. They also don’t believe local shops can put together and run a national campaign from here. And they don’t believe there are enough resources here to properly research and strategically plan a campaign.

Although the resources here may not run as deep as in, say, Chicago, McKendry feels there are enough here to do the job. He also said that shops in Chicago have to look to New York or Los Angeles for talent. So for McKendry, the rock-bottom reason why big brands don’t use local agencies for big jobs is based on a stereotype.

“If you’re an out-of-town consultant, then you’ve got to be smarter than the in-town consultant,” said McKendry of what he considers is a myth.

“There is a badge that comes with that,” he added. “And I think there is somewhat of a badge that says if you’re successful in Chicago, you must be better than the person that is successful in Grand Rapids.”

But McKendry pointed out that his firm, which billed $48 million last year, has national campaign experience and that about half his staff has come from big-city firms and has done big-brand campaigns. He also remarked that the big companies here have big ad budgets as far as local agencies are concerned. But at the major shops, he said, a client almost always has to drop at least $50 million to get the agency’s top people on its campaign.

“You’re not going to get senior-level talent working on that work inside the agency. Now what you see show up at your door may be a whole other thing,” said McKendry. “Millions of dollars don’t matter (to them); it’s how close to a billion you are.”

McKendry plans to counter this situation as one might expect he would: with a marketing campaign aimed at getting big brand ad managers to change their ways. He will tell them that using local shops will result in less travel, fewer fees and lower overall costs for them. He also will tell them that they will get better service and more attention from local shops because their ad budgets will be a larger chunk of a local agency’s total revenue.

“We just want more consideration for us and others in the marketplace. We want to get the message out that just because we happen to be located here doesn’t mean we aren’t as good as anything else out there,” said McKendry. “After all, the brands we’re targeting are located here and that hasn’t been a handicap for them.”

McKendry, a Norton Shores native, left BBDO in Denver to come here in 1988. Back then, he said, the local industry was better known for its design work than its ads. But since then, he feels the industry’s ad expertise has grown dramatically and the work coming from local shops has been fairly strong for the last 10 years. Still, he said, the out-of-town bias hasn’t changed over that period.

“I’ve been in this market now for 15 years. I’ve heard it since I got here. It seemed to kind of hit a feverish pace not long after I got here. There were some big brands working with local shops,” said McKendry.

“You had Steelcase working with Aves — a 40-year relationship with Aves. You had Meijer with a 30-year relationship with Johnson & Dean. Not long after I came to town those relationships dissolved and it affected those agencies greatly,” he said of two shops that once were top agencies in the city.

“I, firsthand, have experienced brands in this marketplace that just will not work with local firms.” 

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