Phillip Adams would have been amazed. For a young man suffering chronic shyness and who froze with terror at speaking to more than one person at a time, I now chaired and drove meetings, steered them in the right direction, brought dissertations to a halt if need be, and found myself to be an effective advertising executive.
I had gained enormous experience in a few short years. I had a feeling for advertising, for the media, for the deal. I felt confident in meetings with advertisers, and was enjoying sharing with them my ideas for how they could best sell their products. It was a very happy time in my life. At Masius I was fortunate to be part of a group of talented young people, all in their late twenties, all aware of what each other was doing, and all fitting our energies to the client’s needs. I understood what creative people were doing, and they understood what I did. It took many of our competitors twenty years to work out how to work together. We all knew we were doing good work. Days flew by, full of work and camaraderie.
My motivation from the start was simple: I was driven by not wanting to fail. I wanted to learn continually. I didn’t want to appear to be smarter than other people. I tried to be circumspect about any of my achievements.
Among our big clients were the petroleum company Mobil, the mining company Alcoa and the confectionery giant Mars. I was deeply involved with the launch of the Mars Bar in Australia, a very large television campaign. My career was going well.
And then it changed direction in the most dramatic way. I was about to turn the advertising industry on its head and, in doing so, became a pariah in the eyes of the established agencies. I was about to learn how to be tough, how to hold your nerve, how to stand up for yourself. I don’t want to come over all Clint Eastwood, but if you are challenging an industry and all its certainties—and indeed its future— then you need a certain steeliness. And I’m not talking about the Clint Eastwood in The Bridges of Madison County; I’m talking about the one in A Fistful of Dollars. The problem was that a fistful of dollars is what the advertising agencies were about to lose. And they weren’t happy.
Here’s why. In the advertising industry thirty years ago there were certainties that no one ever disputed. Its methods were set in stone. A company with a product to sell often left all of its marketing to the advertising agency, which helped to name the product, pick the colour of the pack and do all the research about who it was who would buy it. The advertising agency was the centre of all power.
All media advertising deals were done in-house, almost as an afterthought. It was a time when the ‘creatives’ and the account executives ruled from their glamorous offices. Way down below them were the media buyers—whom John Singleton once called ‘wombats’, presumably because they came out of their burrows only at night—who didn’t have big expense accounts or prestige or indeed much power. That was me and my mates.
But clients started wondering whether this was the best way to operate. These new clients were younger and not set in their ways. The new people emerging had a greater understanding of marketing and the advertising process. They understood how little time and attention was being given to where most of the money was going. They wanted more control. They wanted to see and meet the people who were in charge. It was becoming more than just creating an ad. Their concern was about dealing with the money. The new clients I was meeting started to agree with me that the system was ridiculous.
The concept of a company specializing only in buying advertising space from media companies on behalf of advertisers, thereby bypassing the traditional advertising agencies, then planning a company’s marketing strategy—some later called it a ‘buying shop’—had not been discussed much in Australia, although the idea had taken hold overseas, in France, England, then America. This gap in the market struck me as I sat in two-hour meetings discussing a company’s commercial. I would get three minutes at the end of a two-hour meeting to explain how the advertising agency’s money was being spent. I didn’t think that was right. We might spend $50,000 on creating an ad and $950,000 on spending in the media. And most of the meeting would have been spent on the $50,000.
I was the same age as these new clients, and we started to speak the same language. They were interested in all aspects of the game and understood more of it, too, and they didn’t want to leave it entirely to one or two people inside an advertising agency.
Television was twenty years old and becoming more powerful but was not necessarily understood by the older generation. The new generation realized they could create a brand and a product on television that could replace brands that had always been there. I believed things could be done differently. I put a proposal to Len Reason, the then chairman of Masius, that we would establish a media-buying company within that organization, which I would lead. Twice in a six-month period I tried to persuade them to build a company from within. I felt I understood television. Twice I was refused.
The second rejection was the trigger. I felt it was time to try my own hand at it. In November 1975 I decided to quit my job and start a company that specialized in buying and placing advertisements on behalf of clients. I wanted to stop being one of John Singleton’s wombats. I wanted to come out of the burrow and blink in the sunlight. I wanted to help create a whole new industry. I was going to become a media buyer.
Whenever anyone proposes something that hasn’t been done before, or sounds difficult, or rocks the established world order, then the doubters come out swinging. That’s understandable. I was proposing something radical. But they all queued to talk me down from this madness.
Oh, it can’t be done, they said.
You’ll never take business away from the established advertising agencies, they said.
They’ll crush you, they said.
Be very careful, Harold, you’re going to make some powerful enemies, they said.
Why would clients leave these big well-resourced agencies and go with a little start-up? they said.
I listened to these people respectfully, but I was smiling inside. It’s been said there is nothing more powerful than an idea whose time has come.
The whole of Australia’s advertising industry was against me, but that was all right. I had capital—$2000 in the bank—and motive to succeed: a mortgage and two children under four. I had a good feeling in my bones. I was thirty-four years old, full of fight and energy.
It’s a warm February morning in 1976. I am sitting on the front step of a borrowed office in Lansdowne Street, East Melbourne. Upstairs was my good friend, Austin Begg, who had arranged for us to sublet the room. Parked nearby is a car I had borrowed from a young tyre merchant and soon-to-be client, Bob Jane.
The reason I’m on the step is that our office is one room at the front of a terrace house. It is one room, one phone, one borrowed desk, three borrowed chairs and two people: my secretary Jill Smith and me. Soon we will be three. In the first days of the new business we met clients either on the front steps or at a small café two doors down that had one table and three chairs. That was for the bigger meetings. Jill sat on the other side of the one desk. She would answer the phone and, looking across the desk at me, would say: ‘Just a moment, I’ll see if he’s in’, then hand me the phone.
It was a humble beginning, but that didn’t concern me at all. I was so intent on the journey I was about to embark on that nothing else mattered. Being able to be in charge, knowing that everything I did was up to me, gave me incredible joy.
The meeting on the step that February morning was one of the most important of my life, with Ray Brown from Perth TV station TVW7. The deal was to get Sanyo into a big television campaign, which turned out to be based around the catchphrase ‘That’s Life’. Ray and I grabbed pens, and we sat down to do a deal. It’s an unusual place to do one of the best deals I ever did. But then there was a lot that was unusual about advertising in 1976. Some even called it a revolution.
We were away. I had joined two people in Sydney who were doing the same thing, Dennis Merchant and John Pettett. We called our business Merchant Pettett Mitchell. Later John Pettett came to work with me, as manager of our Sydney office, and Merchant retired. It then became Mitchell & Partners, the second independent media agency in Australia (Merchant & Partners was the first, in 1974) and Melbourne’s first.
Things were tough initially. I had $2000. I paid my secretary $1000 in advance, and I bought a typewriter. That cleaned me out. I went home and told Bevelly we didn’t have any money.
I remember the first $5000 cheque. It was very exciting. It was a loan from my Sydney partner Dennis Merchant, which kept us going. The first year returned a very modest profit; the next few did slightly better. But I wasn’t nervous. I thought it was an incredible opportunity. This is how people start businesses: full of well-placed bravado. I was totally confident, never apprehensive of failure. If you go into anything wondering whether what you’re doing will work, it won’t. People will sense your apprehension.
At the time I didn’t realize that if you’ve got nothing much to lose, you’ll do many things. If you’ve got something to lose you probably won’t be as brave about it. It made me realize that if you are going to start a business or do anything new, it’s probably better to do it younger. Have enough experience—you’ll never have it all—but I probably wouldn’t have done it three years later. I would have been too comfortable, too well paid, with too much to risk.
Our very first deal was with the Nine Network on behalf of a now-defunct company, Sanyo, which made televisions. It involved the sponsorship of the six Paul Hogan shows for the year, and the Logies, a very big deal as far as we were concerned. Sanyo paid $6000 per program for six minutes of time. By 2009 a deal like that would cost $200,000 per program.
Sanyo was one of our very earliest clients, along with Just Jeans and Bob Jane T-Marts. The new brand of clients were mainly owner-operator independent businesses that were making their mark in Australia against the establishment.
Bob Jane T-Marts took on the big tyre companies. Previously tyre retailers had been handled by the tyre manufacturer. Bob Jane started a tyre retailing business independent of the manufacturers. Previously jeans had been bought only in department stores. Craig Kimberley started Just Jeans and went on to build an empire, taking on the department stores. They were both seen as mavericks. Bob and Craig were retailers who understood the power of advertising. Bob Jane T-Marts is still with us thirty-three years on.
Bob and Craig were two down-to-earth Australian businessmen who took on the world and beat it. They were dynamos in a hurry. I have kept in touch with these guys. In 2008 I joined Bob for his seventy-eighth birthday and presented him with a 1930 penny, which was struck the year he turned one. I was looking for something to cheer him up after his well-publicized dispute with his wife. And what do you give a man who owns thirty motor cars?
I knew I was onto something. Indeed, it was a worldwide revolution, a whole new industry, a new understanding of the different elements of the marketing process. Later all of the parts that had been within an advertising agency—public relations, production, research—all broke out in separate areas.
Reaction in the trade was both positive and negative. Although the big clients didn’t rush to join our company, we were happy and grateful for the support of newer businesses that saw the benefits of the individual approach. Soon we had too much work.
After a year we moved to a rented office in St Kilda Road, where we shared with a young man called Phil Ruthven, who started a very successful business called Ibis. I had the second-worst spot in the building, which was over the top of the air-conditioning unit, and he had the worst one, which was next to it.
There was a sour reaction from some in the establishment, advertising agencies talking us down, a campaign of negativity, all protecting their patch. It was predictable, because no one had ever challenged the way this type of business was done. Placing ads for clients was a cosy in-house element of the arrangement. Clearly they didn’t want that to change.
Some advertisers felt the need to warn us about how fragile they thought we were. Ian Fairclough, from Australian Consolidated Press, which published the Australian Women’s Weekly, let it be known that we would be put out of business. What he didn’t know was that all of our mates at ACP who were the sales people were working to make sure we weren’t put out of business.
Geoffrey Cousins, who ran Australia’s biggest advertising agency George Patterson, joined the charge to put us out of business. Cousins said: ‘What those guys are doing is probably illegal.’ He was wrong, and I was extremely unhappy with the imputation. Instead of heading down the legal path my then partners Denis Merchant and John Pettett met Geoffrey’s older half-brother Keith Cousins, who was CEO of George Patterson. We had a civilized chat, and Geoffrey never spoke of the matter again. Geoff is to be admired for his outstanding fight in later years against the pulp mill in Tasmania.
But the message from the agencies was clear: we don’t want you around, and we don’t think you’ll last. Even the competitors I liked sounded confident I would fail. In March 1976, a month after I started, Bevelly received a call at home from Frank Ralph, an ad man I thought was a terrific bloke.
‘The boy’s doing a great job, he’s tremendous,’ Frank said, ‘but I just wanted you to know, Bevelly, because we think so much of you and your family and Harold, that he’d always got a job at our place if it fails.’ Bevelly told me that years later.
A group of agencies went to the controlling bodies of the media companies, the Media Council of Australia, and tried to ensure that these businesses wouldn’t be able to operate directly with the media. It was a protected industry of advertising agencies. You needed a certain amount of funds to be able to get in.
It was a difficult first six months trying to find business, but we struggled on. Ultimately we found a way to operate within the system. We were constrained until 3 February 1997 when the so-called Media Accreditation System, a system protecting advertising agencies, was abolished.
Before that time there was an accepted unacceptable trade practice, which had been there since the 1970s. The practice allowed advertising agencies to operate on a commission system. It allowed the agencies total control over their clients, but the agencies would be subservient to the media. They would get a 10 per cent commission on return for paying the advertiser’s bills in forty-five days. The media companies had a magic carpet ride because they had a guaranteed payment system and a guaranteed date of payment from this group of advertising agencies. It meant the agencies were protected, and that companies like ours would have trouble breaking into it because the 10 per cent commission was a high amount and wasn’t necessary; you needed only about 5 per cent to do the job. We had to work around that. We bought an advertising agency in name, called Biddle Ogle Anderson. The advantage of this was that people couldn’t remember its name.
By 1997 Allan Fels, chairman of the Australian Competition and Consumer Commission (ACCC), had investigated this practice and dismantled the protection system. The established agencies no longer had a protected income system. And they started to get themselves into some trouble. It was a turning point for our type of industry. Our company grew exponentially from that year on. We’d been successful before, but after 1997 we really hit the big time. Several new media-buying companies similar to ours started, but we had a twenty-year break on how to do it.
So it wasn’t supposed to succeed. In quieter moments, when I’ve looked back and tried to see the bigger picture with me in it, all I can say is: what was I thinking?
In 1976 there were four agencies: DDB Needham, George Patterson, JWT and Leo Burnett. At times back then we felt very alone. Now there are more than fifty of various sizes.
By the late 1970s we were doing well. I employed more staff and moved to a property of two terrace houses joined together in South Melbourne. We had twelve staff.
We never lost sight of what we were doing. As Dirty Harry Clint Eastwood once asked a street punk whether he was feeling lucky, with a .44 Magnum pointed at the hapless punk’s head. I could never muster Eastwood’s flinty stare into the distance, not to mention his extraordinary economy with the language. I enjoyed talking too much. Talking was my job. That’s what I did all day long. So Clint and I were very different. But I did feel lucky. And the funny thing was, the harder I worked, the luckier I got.
The idea of going out alone had worked. It had been an incredibly tough first year. Now I just had to do it every day for the next thirty-three.