Campbell-Mithun-Esty, Inc. History

Address:

222 South 9th Street
Minneapolis, Minnesota 55402
U.S.A.

Telephone: (612) 347-1000
Fax: (612) 347-1515

Private Company
Incorporated: 1933 as Campbell-Mithun Advertising, Inc.
Employees: 1,041
Gross Billings: $500 million (1995 est.)
SICs: 7311 Advertising Agencies

Company Perspectives:

Strategic thinking matched with creativity and integrated communications resources are essential to succeeding in today's highly competitive marketplace. CME's mission is to create and execute innovative marketing communications programs that help its clients and their brands achieve dominance.

Company History:

Campbell-Mithun-Esty, Inc. is one of the world's most renowned advertising agencies. Based in Minneapolis, Campbell-Mithun-Esty has worked on some of the most famous advertising campaigns in the industry, including Andersen Windowalls, Heileman's Old Style beer, Jockey For Her Underwear, 3M Disposable Masks, Granola Fruit Bars, Kohler Infinity Bath Whirlpool, Golden Grahams Cereal, Kmart, and a memorable host of others embedded in the American popular consciousness. With its headquarters in Minneapolis, the company has major offices in Chicago, Detroit, and New York, and in more than 20 smaller locations spread across the United States. Unfortunately, beginning with the late 1970s, the company has gone through a series of mergers and acquisitions, resulting in a dispersal of its creative energy and a decrease in worldwide billings. The recent 50-50 buyout between company management and The Interpublic Group of Companies, however, one of the world's largest advertising agencies, seems to have provided a new lease on life for Campbell-Mithun-Esty.

Early History

The company opened in the midst of the Great Depression during a time of widespread business closings and bank failures. In 1933, Franklin Delano Roosevelt issued a nationwide Bank Holiday proclamation soon after his inauguration in March, closing all financial institutions to prevent further panic among the population. In April, Campbell-Mithun started its operations in the vacated offices of a failed bank in downtown Minneapolis. With a staff of five, including the two owners, the company began working on its first advertising campaign.

Ralph Campbell, one of the owners, had worked as a manager of the BBDO office in Minneapolis for years. Since it was the only office making money at the time, primarily because of Campbell's noncyclical foods accounts, he was ordered by the BBDO agency chief to relocate to New York and create a food division there. Campbell, nearing the age of 50, refused to move from his hometown. The head of BBDO regarded Campbell's decision as insubordination and promptly fired him. Campbell immediately decided to start a company of his own, using his contacts within the food industry as the basis for his first advertising campaigns. Knowing that he could not succeed on his own, Campbell asked Ray Mithun to be a partner in the undertaking. Mithun, a young man at 24 years of age, had grown up in Buffalo, Minnesota, just north of Minneapolis, graduated from the University of Minnesota, and held temporary jobs as a journalist and editor at various publications in the town. In 1930, Mithun was hired as a copywriter by Campbell at the BBDO office. Aware that Mithun was an excellent copywriter and talented adman, Campbell did not hesitate to ask the young man to join him as a full-fledged partner on equal terms.

The first three accounts of Campbell-Mithun included Andersen Corporation, Land O'Lakes, and Northwestern National Bank, all located in the greater metropolitan area of Minneapolis. In gaining newer and ever more prestigious accounts, the two partners developed a simple strategy. If they could not initially win the account that they wanted, the two men would arrange to work on one in the same category, demonstrate their agency's ability to develop good advertising for the company, and then go on to win the account that they really wanted. This strategy held true not only for the type of business, but for the size of the account as well. Good work on smaller accounts ultimately led to work on bigger ones. This strategy helped the fledgling company not only survive the Great Depression, but establish a name for itself as one of the most reliable and creative advertising firms west of the Mississippi.

The War Years and Postwar Period

By the time America entered World War II in December of 1941, Campbell-Mithun was a well-established and thriving advertising agency. The company's accounts with Andersen Corporation, Land O'Lakes, and Northwestern National Bank continued to grow. But Ralph Campbell, who had a history of heart ailments, began to limit his time at the company's office. Mithun, as a result, began to take over more of the creative and administrative responsibilities. By the time Campbell died in the fall of 1949, during the halftime festivities of an Iowa-Minnesota football game, Ray Mithun had already assumed control of the firm's operations. One of the first decisions Mithun made after his partner's death was to hire Albert R. Whitman, a highly respected adman and top executive at Benton & Bowles in New York City.

Mithun and Whitman continued the strategy that the original two partners conceived to win new accounts. A good example of this strategy is illustrated by the story of winning the General Mills account. Although the Pillsbury Company was located in Campbell-Mithun's own backyard of Minneapolis, the advertising firm had an extremely difficult time landing the account. In 1951, management at Pillsbury finally handed Campbell-Mithun one of its subsidiary's accounts, the recently acquired Ballard Flour Company. Ballard Flour Company made biscuits, and Mithun immediately recognized the potential for a combination of television advertising and product demonstration. Soon the company was creating television advertisements proclaiming the delights of eating Ballard biscuits. To mix a metaphor, biscuits started selling like hotcakes, and Campbell-Mithun easily convinced Pillsbury not only to advertise its own biscuits but also to advertise other products under the company name. Within a few short years, the Pillsbury business grew into an $8 million account. A few years later, Mithun, who had always wanted to win the General Mills account, strode into that company's executive office in Minneapolis and announced that he had just resigned from the Pillsbury account and was ready to begin business with General Mills. Management at General Mills hesitated, but gave Campbell-Mithun some small product work. Needless to say, it grew into a full-fledged account not long afterward.

The manner in which Campbell-Mithun won or developed other accounts also became something of a legend within the advertising agency. During the firm's early years, it was contracted by the Gold Seal Company of Bismarck, North Dakota. Gold Seal, the manufacturer of Glass Wax window cleaner was constrained by a small budget, however. In spite of this limitation, Campbell-Mithun created one of its most successful advertisements by encouraging the use of the window cleaner during the Christmas holidays. The ad campaign encouraged people to decorate their windows with festive holiday shapes such as reindeer, Santa Claus, sleds, and Christmas trees by spraying Glass Wax through stencils. When the product was sprayed on the window, it dried and created a white, powder-like residue. Upon removal of the stencils, the decorative holiday figures remained.

Another famous ad campaign involved the Northwestern National Bank of Minneapolis. Campbell-Mithun developed a weatherball for the company, a large sign that perched on one corner of the bank and was topped by a weatherball that changed colors according to fluctuations in the temperature. The weatherball turned white for cold weather, red for warm weather, green for no change in temperature and, in a burst of creativity by the company, was designed to blink when it was supposed to rain. For years, the weatherball was used by the bank in all its advertisements to unify the marketing campaign of its growing branch office network throughout Minnesota and neighboring states.

By the late 1950s and early 1960s, Campbell-Mithun was highly regarded within the advertising industry for its creative work. One of the ad campaigns that propelled the company to the front ranks of the industry was the "Land of Sky Blue Waters" television spot for Hamm's beer. The success of this campaign led to many other accounts across the country. Many people suggested to Ray Mithun that he relocate his agency to New York City, the heart of the advertising industry. Mithun wanted no part of the Big Apple, he said, and was determined to remain true to his Midwestern heritage. Campbell-Mithun did open an office in Chicago, however, which became one of the company's few permanent satellite locations. Offices were opened in other cities only when company staff had to work on an account there and, in accordance with Mithun's operating strategy, were closed when there was no longer any account to service or business to keep the office profitable.

Growth and Transition During the 1970s and 1980s

Still active as a creative force within the company, in his late 60s Mithun was mindful of the fact that no advertising agency in Minneapolis had survived the first generation of leaders. Therefore, he did everything in his power to encourage staff members to become invested in the company. But when Mithun sold all of his stock back to the company in 1972, and then gradually withdrew from active participation in the agency before he retired in 1978, it was only one year later that management at Campbell-Mithun decided to accept an acquisition offer from New York-based Ted Bates, Inc., the fourth largest advertising agency in the world at the time. Campbell-Mithun had already surpassed the $100 million mark in billings and listed such prestigious clients as General Mills, Honeywell, 3M, Heileman Brewing Company, Land O'Lakes, International Dairy Queen, and Munsingwear. The largest acquisition in the history of the advertising industry, Bates added a highly renowned creative agency to help expand its growing list of accounts, while Campbell-Mithun gained access to the center of the advertising agency universe in New York City.

In 1986, Saatchi & Saatchi PLC, a London-based ad agency that was at the forefront of the acquisition and merger mania that shook the advertising industry during the 1980s, decided to purchase Ted Bates Worldwide and its subsidiaries, including Campbell-Mithun. In the late 1970s and early 1980s, Campbell-Mithun had experienced a difficult time procuring accounts outside of its Minneapolis and Chicago office locations; nonetheless, billings reached $250 million by 1983, making it the largest advertising agency west of the Mississippi River. The acquisition of Ted Bates Worldwide by Saatchi brought along with it another subsidiary, The William Esty Company. Formed in 1932, the New York-based William Esty Company, with billings of $563 million in 1983, held many of the automotive company accounts in Detroit, Michigan. Management at Saatchi, therefore, decided to merge Campbell-Mithun with Esty to create the most powerful ad agency in the midwestern United States. Named Campbell-Mithun-Esty (CME) in 1988, the new company had combined billings of $740.8 million and offices in Chicago, Detroit, Los Angeles, Minneapolis, New York, Toronto, and Windsor, Canada.

The 1990s and Beyond

The combination of Campbell-Mithun with The William Esty Company appeared to be a good match. The number and prestige of accounts continued to increase, and Campbell-Mithun-Esty prospered accordingly. In January of 1992, CME acquired Goodwin, Dannenbaum, Littman & Wingfield. The oldest and largest independent advertising agency based in Houston, Texas, the purchase increased CME's billings to approximately $1 billion. In September of the same year, management at Campbell-Mithun-Esty announced the merger of CME and London-based KHBB to form a new international advertising agency network. CME-KHBB Advertising, Inc., with combined billings of $1.2 billion, was listed as the 17th largest ad agency in the world. The agency's offices were located not only in the United States and Canada, but also throughout Europe and Asia. The idea behind the merger, according to Saatchi & Saatchi management, was to create a network of small offices located in major cities around the world.

In February 1994, nearly two years after the formation of CME-KHBB Advertising Agency, management decided to return to the Campbell-Mithun-Esty moniker in North America to capitalize on the name recognition of its founders. Although the CME-KHBB name was retained in Britain and Continental Europe, to a certain extent the name reversal to Campbell-Mithun-Esty within the United States heightened the company's profile.

Unfortunately, not long afterward, Saatchi & Saatchi, which had changed its name to Cordiant, decided to dismantle CME-KHBB. The strategy behind the formation of CME-KHBB was not working and, with additional pressure on Cordiant from client Proctor & Gamble regarding the CME advertising campaigns for DowBrands, Campbell-Mithun-Esty was put up for sale. In April of 1995, Campbell-Mithun-Esty management and The Interpublic Group of Companies reached an agreement to enter into a joint ownership of the company. New York-based Interpublic, the second largest collection of advertising agencies in the world, purchased a 50 percent stake in Campbell-Mithun-Esty for an estimated $40 million, while CME management retained the other 50 percent interest.

In the mid-1990s, Campbell-Mithun-Esty had one of the most prestigious client lists in the advertising industry, including BASF, Borden, Century 21, Commerce Bancshares, ConAgra, DowBrands, Frigidaire, E. & J. Gallo, General Mills, Honeywell, International Dairy Queen, Kimberly-Clark, Kmart, Land O'Lakes, National Easter Seal Society, Northrup King, Pfizer, Pillsbury, Toro, and US WEST. Still headquartered in Minneapolis, Minnesota, the company had major offices in Chicago, Detroit, and New York City. Billings at the end of 1995 were reported to be $633.2 million and growing.

Campbell-Mithun-Esty, Inc. History

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