Lintas: Worldwide History

Address:

1 Dag Hammarskjold Plaza
New York, New York 10017
U.S.A.

Telephone: (212) 605-8000
Fax: (212) 838-2331

Wholly Owned Subsidiary of Interpublic Group of Companies Inc.
Incorporated: 1987
Employees: 7,269
Gross Billings: $5.12 billion
SICs: 7311 Advertising Agencies

Company History:

One of the largest advertising agencies in the world, Lintas: Worldwide operates in 50 countries through more than 160 offices. During the mid-1990s, Lintas: Worldwide collected more than $5 billion in billings by developing advertising campaigns for a host of clients, the two largest of which were Johnson & Johnson and Unilever. Although the agency's corporate roots stretch back in several different directions, befitting the acquisitive nature of the advertising industry, it essentially began in 1899 as an in-house advertising shop for Lever Brothers, a British-based soap manufacturer. When Lever Brothers developed into the diversified Anglo-Dutch giant Unilever, Lintas gained a massive client that would sustain the agency's growth for the rest of the century. From its mainstay Unilever advertising account, Lintas went on to win numerous other advertising accounts from multinational clients including Diet Coke, Mastercard, and IBM.

Beginning in the mid-1960s, advertising agencies in the United States began acquiring one another, each hoping to increase their volume of business and clientele by absorbing the advertising accounts of fellow agencies. Acquisitions were not new to the industry, but with increasing frequency from the mid-1960s forward, one agency melded with another, joining forces to secure a firmer grip on the advertising dollars spent by manufacturers to sell their products. An industry-wide trend was beginning to take shape as agencies began to acquire one another, engendering a national phenomenon that extended beyond domestic borders to include foreign advertising agencies and the billions of dollars involved in what eventually would become a genuine global economy. As the acquisitive trend gained momentum, growth achieved through internal means became less attractive to aspiring agencies than the more expeditious approach of achieving growth through external means; acquisitions, mergers, and consolidations yielded immediate growth with the signing of documents, enabling aggressive agencies to double or quadruple their billings overnight. Of the 92 largest U.S. advertising agencies in 1966, 41 were either owned by other agencies or out of the business by the beginning of the 1980s. From the 1980s to the mid-1990s, the industry trend toward consolidation continued, accelerating if anything, producing a closely knit cadre of market leaders, each of whom represented a combination of various agencies weaved together over the previous 30 years.

During this 30-year era of consolidation, Lintas: Worldwide was created, although its ancestral roots stretched back well before the U.S. advertising agency industry began to coalesce in the mid-1960s. Like other large agencies that blossomed during this period, Lintas represented an amalgamation of various agencies that had banded together during the consolidation of the advertising industry, but two primary predecessor agencies formed the core around which other agencies were added later. These two agencies were Lintas, the in-house advertising agency formed in 1899 by British soap maker Lever Brothers, and an advertising agency founded in 1946 named Sullivan, Stauffer, Colwell & Bayles.

Lintas, an acronym for Lever International Advertising Services, operated initially as a captive advertising organization with a clear and necessarily restricted objective: develop advertising campaigns for the products manufactured by Lever Brothers, which rose to prominence through its production of Sunlight, the world's first packaged, branded laundry soap. An early proponent of large-scale advertising, Lever Brothers relied heavily on Lintas to develop advertising campaigns for the company's various soap products, which were sold in Europe, Australia, South Africa, and the United States. Lintas, accordingly, focused exclusively on supporting its rapidly growing owner, but when Lever Brothers and the Netherlands-based Margarine Union merged in 1930, creating Unilever PLC and Unilever NV, Lintas essentially became an independent agency and began pursuing advertising accounts on its own, supplementing its advertising activities for Unilever with advertising work for other European companies. Although the London-based agency continued to rely heavily on business derived from its relationship with Unilever, its non-Unilever advertising work gradually increased, accounting for 20 percent of its business worldwide by the mid-1960s, when the agency claimed to be the largest advertising shop in Europe. Lintas by this time had offices in 26 countries, conducted its advertising in 49 languages, and had established a presence in nearly every sector of the world except the United States, where another agency it would soon join forces with had been operating for the previous 20 years. When these two agencies came together, the foundation for Lintas: Worldwide was created.

The other agency that would figure heavily into the creation of Lintas: Worldwide was Sullivan, Stauffer, Colwell & Bayles, founded in 1946 by Raymond Sullivan, Donald Stauffer, Robert Colwell, and S. Heagan Bayles. During the 20 years bridging its formation and its association with Lintas, Sullivan, Stauffer, Colwell & Bayles had developed into a more than $100 million advertising business, deriving all of its billings from the United States and Puerto Rico, two of the few regions in the world where Lintas's considerable reach had not yet extended. Intent on expanding into the United States, Lintas first approached Sullivan, Stauffer, Colwell & Bayles in 1962, when the two agencies worked out an agreement that sent Lintas executives to Sullivan, Stauffer, Colwell & Bayles for training in Stateside advertising techniques.

This initial link between the two organizations worked well, with more than 300 Lintas executives receiving training from Sullivan, Stauffer, Colwell & Bayles officials by the decade's conclusion. In 1967 the bond between the two agencies was strengthened substantially when they completed a formal contractual agreement to cooperate on worldwide advertising accounts, combining their facilities to provide a global advertising and marketing service. The result of this agreement created SSC&B: Lintas International, which began to conduct advertising work for several companies including Esso in Africa, the Middle East, and Portugal, Monsanto Co. in Europe, and Simmons Co. in Paris.

Three years later, in January 1970, Sullivan, Stauffer, Colwell & Bayles shortened its corporate title, changing its name to SSC&B, Inc., one month before its relationship with Lintas was strengthened further. In February the two agencies were involved in the largest single acquisition in the history of the advertising industry when SSC&B, Inc., purchased a 49 percent interest in Lintas, thereby creating SSC&B-Lintas, the seventh-largest advertising agency in the world. With nearly $200 million in billings, SSC&B-Lintas represented a prodigious global advertising force, comprising Lintas's considerable international experience in marketing the foods, detergents, toilet goods, packaging, plastics, and chemicals produced by Unilever PLC and Unilever NV and the U.S.-based business of SSC&B, which had built its reputation on developing Cover Girl advertising campaigns for cosmetics manufacturer Noxell Co.

For its size, the merger represented a historic transaction in an industry that was beginning to consolidate, ranking as the largest acquisition ever until SSC&B-Lintas again became involved in a merger of unprecedented magnitude toward the end of the 1970s. During the 1970s, another large advertising agency, New York-based Interpublic Group of Companies, Inc., was doing its part to join in the acquisitive trend sweeping through the advertising industry by absorbing several foreign and domestic advertising agencies in quick succession, purchasing six agencies between 1975 and 1977. In 1978 Interpublic directed a hungry look toward SSC&B-Lintas, announcing in November it intended to acquire the agency and 49 percent of SSC&B: Lintas International, the corporate entity formed by Sullivan, Stauffer, Colwell & Bayles and Lintas in 1967. Interpublic had been attracted by the overseas capabilities of SSC&B-Lintas, and when the transaction was completed in September 1979, Interpublic gained such capabilities, along with more than $1 billion in worldwide billings, which ranked as the largest merger in the advertising industry to that point.

Before its acquisition of SSC&B-Lintas, Interpublic already owned the country's second-largest advertising agency, McCann-Erickson Worldwide; the 15th-largest, Campbell-Ewald; the 30th-largest, Marschalk; and the 80th-largest, Erwin Wasey. Once SSC&B-Lintas was purchased, Interpublic added the eighth-largest agency to its formidable portfolio, one that collected nearly $850 million in billings from a respectable client roster that included Johnson & Johnson, Noxell, Sterling Drug, Rowntree Mackintosh, and, of course, Unilever. The agency's long association with Unilever, however, had earned SSC&B-Lintas the reputation of a rather conservative and dull advertiser, an agency that was well disciplined but conservative in its approach to marketing products. Its association with Interpublic would quickly change this perception. Beginning shortly after its absorption by Interpublic was completed, SSC&B-Lintas scored a major victory by taking on a Diet Coke advertising campaign as a secret project in 1980. The project led to SSC&B-Lintas's "Just for the Taste of It" campaign, the success of which lent the agency the legitimacy its need to be regarded as a glamorous consumer-products advertiser capable of developing creative and effective advertisements.

While this pivotal advertising campaign was under way, Interpublic purchased the remaining 51 percent of SSC&B: Lintas International in 1982, creating SSC&B: Lintas Worldwide, an agency that emerged after the transaction with three times the billings of the old SSC&B-Lintas. The next major transaction occurred five years later when Interpublic merged SSC&B: Lintas Worldwide and another of its agencies, Campbell-Ewald Co., which had built its business on advertising accounts for General Motors. Once merged the two agencies became Lintas: Worldwide, an agency group comprising Lintas: International and Lintas: USA, which included Campbell-Ewald's New York offices and the former SSC&B-Lintas agency.

Despite some problems with integrating the two managements, the merger was widely perceived as a success, creating the eighth-largest advertising agency in the country as well as one of the fastest growing agencies. Before the merger, SSC&B: Lintas Worldwide was collecting $1.7 billion in billings; Campbell-Ewald was generating $584 million in billings. After their first full year together, the combined agency had grown 50 percent, achieving $3.3 billion in billings and accounting for 41 percent of Interpublic's $1.2 billion in 1988 revenues. Much of this growth was attributed to the agency's more aggressive approach after the merger to obtaining new business, which brought in $250 million in billings during the first year after the merger from several notable clients. Mastercard's advertising account was awarded to Lintas: Worldwide, as well as Princess Cruises's $35 million account, RJR Nabisco's Planters Life-Savers' $25 million account, and the much-coveted $70 million account awarded by IBM Personal Computer Co.

The addition of these new clients were important developments for an agency attempting to reduce its reliance on long-standing clients Johnson & Johnson and Unilever. As Lintas: Worldwide exited the 1980s and prepared for the 1990s, the agency was encouraged by its quick success in attracting new accounts and began pursuing a five-year plan to develop into a $6 billion advertiser, hoping to add new clients to its core Johnson & Johnson and Unilever business. The early 1990s, however, provided less encouraging results than the late 1980s, particularly in the United States, where the agency's subsidiary, Lintas: New York, suffered a precipitous drop in its billings. Between 1992 and 1994, Lintas: New York watched its billings slip from $750 million to $350 million, a deleterious plunge brought about by the departure of several important clients from the agency's business. During the two-year span, Lintas: New York lost advertising accounts for Mastercard, Diet Coke, Molson, Maybelline, and IBM, arousing considerable concern as to the agency's future.

To bolster Lintas's U.S. interests, Interpublic searched for an acquisition and in July 1994 acquired Ammirati and Puris Inc., a New York-based agency that had built its business on a two-decade advertising relationship with German car manufacturer BMW. Ammirati and Puris was then merged with Lintas: New York, creating Ammirati and Puris/Lintas, the formation of which was designed to arrest the further erosion of Lintas: New York's business.

As Lintas: Worldwide entered the mid-1990s, hoping to recover from the losses it suffered earlier in the decade, it named a new chairman and chief executive officer to steward the agency through the late 1990s and into the 21st century. Martin Puris, the former leader of Ammirati and Puris, was promoted to Lintas: Worldwide's two highest management positions in July 1995 after successfully completing the incorporation of Lintas's New York offices into Ammirati and Puris. With a new leader at the helm, Lintas: Worldwide moved ahead, hoping to keep pace with a growing industry and establish new accounts.

Principal Subsidiaries: Lintas, Inc.; Lintas USA, Inc.; Lintas Marketing Communications, Inc.; Lintas Proprietary Limited (Australia); Lintas Communications Pty. Limited (Australia); Lintas Werbeagentur Gesellschaft mbH (Austria); Lintas Brussels S.A. (Belgium); Lintas Chile S.A.; Lintas Praha Spol. s.r.o. (Czech Republic); Lintas Danmark A/S (Denmark); Lintas International Limited (England); Lintas Overseas Limited (England); Lintas Superannuation Trustees Limited (England); Lintas W.A. Limited (England); Lintas Oy (Finland); Lintas Make Direct Oy (Finland); Lintas Service Oy (Finland); Lintas-Paris; Lintas Deutschland GmbH (Germany); Lintas Direct GmbH (Germany); Lintas Frankfurt GmbH (Germany); Lintas Hamburg GmbH (Germany); Lintas Hong Kong Limited; Lintas Budapest Reklam es Marketing Kommunicacios Kft (Hungary) (90%); Lintas Japan K.K.; Lintas Milano S.p.A. (Italy); Lintas Mexico S.A. de C.V. (Mexico); Lintas Worldwide Namibia Limited; Lintas Nederland B.V. (Netherlands); Lintas Warszawa (Poland); Lintas, Agencia Internacional de Publicita Limitada (Portugal); Lintas Puerto Rico, Inc.; Lintas Worldwide Private Limited (Singapore); Lintas Limited (South Africa); Lintas Korea, Inc. (South Korea); Lintas S.A. (Spain); Lintas AB (Sweden); Lintas A.G. (Switzerland); Lintas Taiwan Limited; Lintas Ltd. (Thailand) (80%); Grafika Lintas Reklamcilik A.S. (Turkey) (51%); Lintas Limited (Zimbabwe).

Lintas: Worldwide History

Company History:

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