Failure is not an option

The straight-talking head of Interpublic’s newly merged ‘smart’ integrated offering is a larger-than-life character, one who believes that accountability and cost efficiencies are as important as creativity – as we reveal in this exclusive interview with Marketing Week. By Catherine Turner.

Few loom as large in today’s advertising industry as the ebullient and “straight-talking” American, Howard Draft. So charismatic is the chairman and chief executive of newly merged DraftFCB that at times he threatens to overshadow the agency that bears his name.

One industry source says: “He is larger than life. I doubt that we have had such a character since Garry Lace.”

Indeed, in the furore over the agency’s win – and subsequent loss – of Wal-Mart’s $470m (£240m) US advertising account, headlines focused as much on the man as the agency.

“I don’t want to be noticed that way,” proclaims Draft, in an exclusive interview with Marketing Week. “It was the best of times, and the worst of times.”

Some believe the image of the confident showman and self-proclaimed entrepreneur is at odds with that of the two Interpublic Group (IPG) agencies which came together last year and were seldom cited for their creative flair.

But creative awards are not important, says Draft: “We’re here to solve clients’ business problems. The only thing that is equal to creativity is accountability.”

He is unapologetic that his focus is on money. “A lot of agencies are run by ‘creative’ people, which is wonderful, but our job is to make our clients more money and to make profits for our shareholders,” he adds.

Upsetting the Purists
Such an attitude has won him few fans with advertising purists following his elevation from chief of a direct marketing agency to that of an integrated offering encompassing the above-the-line FCB network.

Draft’s emphasis has always been on results and cost efficiencies rather than creativity, says one US executive: “He has upset the global industry with the FCB merger.”

“He is very keen on data,” adds a UK industry source. “And you know what – he might be right. If any client thinks it can get an edge on a competitor then he will grab it.”

Draft himself believes that most agencies are “too soft” with their data, which is a mistake in a world which is increasingly “data-powered”.

Ask any industry figure who knows Draft, and the first thing they talk about is his confident, self-aggrandising personality. “He seems to live in ‘Howard World’,” says one. “But don’t let that fool you. He is incredibly successful and in order to be so, you have to be incredibly astute.”

Draft attributes his success to being lucky, direct and loyal. He admits: “People probably think that I am a little strange but I think that I am pretty upfront. I don’t colour thoughts with words that are evasive. If you ask me a question I will give you a straight answer.”

When news of the merger first surfaced in June last year, he made a point of calling senior FCB executives and assuring them of their worth. He is also relentlessly driven, admitting more than once that “failure is not an option”, despite the challenges ahead.

Draft is passionate about the integrated model DraftFCB is trying to pioneer, believing it to be unique in its desire to tear down boundaries between the marketing divisions.

“I am a change agent,” he says. “I believe in the evolution of the industry, which means the agency must change as well.”

It is an indication of how highly IPG rates Draft – and of the Chicago-born father of three’s own ambition – that he has been charged with driving that evolution. The merger initially started off as talks to integrate Draft into FCB, although few would dispute that the head of the DM shop is firmly in the driving seat. “They [IPG] wanted to do a world group that was different,” he says.

His counterpart at FCB and fellow merger architect Steve Blamer left before the new agency launched. Sources close to Draft suggest Blamer was asking for too much power in the new structure as global chief operating officer and Draft’s one direct report – a concession Draft was unwilling to make. “Blamer wanted to do everything and Draft didn’t want that,” suggests the source.

Everyone is Happy
IPG believes that this merger of two “profitable” agencies – albeit ones that fare far better across the Atlantic than in Europe – will do well. One industry executive claims IPG now has a “smart” agency portfolio as a result of the merger: “Within the group you now have a perceived creative agency in Lowe, a pragmatic agency in McCann Erickson and a smart integrated offering in DraftFCB. There is something for everyone.”

AAR director of advertising Martin Jones concurs, but believes Draft may have trouble selling the concept to potential clients. He says: “There is a huge difference at this stage between selling the concept to a new client and to an existing client. I have no doubt that it can be made relevant and interesting to existing clients but because of the way clients currently choose agencies – separately pitching the different disciplines – I am yet to be convinced that it is as compelling a proposition for potential clients.”

One new client that was sold on the integrated offering was Wal-Mart, which awarded the newly formed agency its advertising account. Yet the events that followed threatened to overshadow everything thus far achieved by Draft and his lieutenants.

Draft himself was forced to issue a statement to staff and clients claiming the agency was not to blame following its sacking from the account before any work was produced. Wal-Mart took the decision after firing chief marketer Julie Roehm over her handling of the pitch and the publication of an in-house ad perceived to be gloating over the win. “It was the perfect storm,” Draft acknowledges.

Roehm has since filed a lawsuit against her former employer, while the agency launched an investigation which it says cleared it of any wrongdoing.

The offending ad, which congratulated Cannes Lions advertising winners, showed two copulating lions and featured the strapline “It’s nice to be on top”. However, it was allegedly not cleared by Howard Draft, a fact about which insiders say he was privately seething.

Whether rules were breached or not, there are those who criticise both Draft and Wal-Mart for being “hopelessly naive”.

More to Come
Outwardly, at least, the debacle is no longer on Draft’s agenda. He is looking to the future, admitting the London agency has problems not perceived in the US. But he says he is “confident in the new management and in the new model”, and in developing the business globally. That includes launching a second agency brand to manage conflict clients and focus on new business – which has been notably slow in the UK – from mid-2007 onwards.

Few doubt Draft’s ambition and self-belief. IPG boss Michael Roth has called Draft a “no-nonsense visionary”. Roth will be hoping that Draft can replicate the success of his eponymous agency, rumoured to have generated $350m (£177m) in annual revenue and global margins of 15%, making it one of the few jewels in IPG’s crown.

Easy as it might seem to dismiss the brash and driven American as an advertising clown devoid of creativity, he is also the ringmaster who keeps his clients’ bottom lines – and desire for return on investment – at the forefront of his mind. As Draft himself repeatedly says: “Failure is not an option.”

CV of the ‘change agent’
• Draft leaves college in 1976 and applies to Chicago’s two biggest agencies, Leo Burnett and J Walter Thompson. He is rejected by both and joins a direct marketing agency.

• In 1977, at the age of 23, he and 12 colleagues leave to form a start-up called Kobs & Brady (later Kobs & Draft, and then just Draft). The agency is sold in 1986 to Ted Bates (eventually becoming part of Saatchi & Saatchi’s Cordiant Communications Group) Draft becomes chairman and chief executive in 1988, staying for eight years until Charles and Maurice Saatchi are ousted. Draft negotiates a buyback of the company for about $27m (£15.2m).

• Less than a year later, in 1996, he sells it to Interpublic Group for just over $100m (£66.3m) – the highest price the group had paid for a single agency at the time.

• In 2003, a merger of Draft with Lowe Worldwide is mooted but never materialises.

• In June 2006, IPG announces Draft Worldwide will merge with FCB to create DraftFCB. Draft becomes chairman and chief executive of the merged entity. His FCB counterpart, Steve Blamer, leaves.

• DraftFCB wins the flagship Wal-Mart account in November 2006. However, it is fired from the business before starting work on the account. Draft admits: “It was the best of times – and the worst of times.”.

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