Agencies Of The Year – Southwest Agency Of The Year: GSD&M

Dream Factory: GSD&M Proves that Vision and passion pay off
You might not think of Austin, Texas, as a media mecca. Yet many sizable clients are making the pilgrimage to work with GSD&M, putting their media accounts in the hands of the agency that dubbed its headquarters Idea City.
Once again GSD&M, Adweek’s 1999 Southwest Agency of the Year, boasted a strong year in terms of client wins and stellar creative work. But it was media, particularly the $100 million win of the DreamWorks SKG media-buying account, that raised the agency’s profile and eyebrows across the country.
That victory was part of a strategy devised by president Roy Spence to fundamentally alter the makeup of GSD&M. “We set out on a journey about three years ago. I said I believed we ought to have a significant part of our business–one-third of our accounts–media-only clients,” says Spence.
The profitability of the sector was an attraction, as was the quick pace of change within broadcast media, thanks to the growth of Internet and cable delivery systems. “The delivery mechanism has become more important,” says Spence. “We can have the best strategy and creative in the world but if we don’t deliver the message, targeted effectively, all that doesn’t matter.”
The agency began its internal campaign by recruiting Betty Pat McCoy–one of the best-known media negotiators in the business–then at DDB, to become vice president and director of national broadcast. The agency opened a media office in Chicago, where buyers could have a bigger impact than in the overcrowded New York market. Then the agency developed its secret weapon: a media research tool and approach so proprietary executives won’t even reveal what its acronym–ALLI–means.
Finally, the infrastructure was in place. It was time to pitch new business.
Initially, there was “a lot of scoffing” among established media players over GSD&M’s sudden participation in media-only reviews, says Spence. “We’ve been able to compete against media-only giants and beat them by bringing a culture of understanding customers, not just understanding numbers,” he says.
DDB, Carat and DeWitt are a few of the media veterans GSD&M has defeated.
“There’s no question that the DreamWorks win was one of the absolute highlights of ’99,” says Judy Trabulsi, co-founder, executive vice president and media director, who has overseen the agency’s media department since the shop’s inception in 1971.
This wasn’t GSD&M’s first brush with DreamWorks. GSD&M had shared film assignments for several months with incumbent Focus Media of Santa Monica, Calif., as the studio measured the capabilities of both agencies. GSD&M bought time for Prince of Egypt, while Focus was assigned Antz.
How did GSD&M snag the big prize? “I think we won on merit and passion,” says Spence, who led the pitch with Trabulsi.
From its first major media account win in 1995, the $180 million MasterCard account, media-only business now accounts for one-third of GSD&M’s revenue. The department has mushroomed from 60 people to more than 165 in just two years, while the Chicago office adds another 30 staffers.
Last year, GSD&M also picked up the media account for Quaker State motor oil from existing client Pennzoil. The agency kicked off 2000 announcing that SBC Communications had consolidated its $80 million media-buying account for Ameritech at GSD&M.
How did all this happen in just a few years? Spence, the loquacious co-founder of the agency, has a theory.
“We have what we call BHAGs: Big Hairy Audacious Goals,” he says. “Every organization needs to have really audacious, but not unrealistic, goals. One of our goals was the acquisition of an entertainment [client]. DreamWorks is an extraordinary company, and we proved once again that talent can come from anywhere. We’re from Austin, Texas, you know.”
In the general advertising account arena, new business wins by GSD&M in 1999 include Wenner Media (publisher of Rolling Stone, Us and Men’s Journal), the United States Olympic Committee and accounts Hoover’s Online, and, among others.
Billings last year jumped by about $150 million–almost a 32 percent increase over 1998. Overall, the agency estimates billings reached $951 million last year. Revenue increased 15 percent, to an estimated $64.5 million.
Idea City expanded along with its client list, adding 80,000 square feet and some unusual brainstorming spaces.
“That was one thing I personally spent a lot of time on last year,” says Spence. “I believe that ideas are going to be the currency of the 21st century; corporate cultures are going to be the competitive advantage. We spend an enormous amount of time on our creative culture.”
GSD&M also formed a new division last year called Idea Studio, dedicated to the exploration of longer forms of entertainment, beginning with a 30-minute pilot for PBS sponsored by advertisers. As convergence occurs between commercial and artistic forms of expression, GSD&M wants to be at the forefront of fostering new talent.
“One thing is sure–the Idea Mansion has many rooms,” Spence says.