History of advertising: No 165: Michael Ovitz's CAA

One of the global ad industry's biggest-ever wake-up calls came in October 1991.

What happened that month didn’t just send shudders through McCann Erickson, which found the Coca-Cola business it had handled since the 50s being moved into – of all things – a Hollywood talent agency. It also put the frighteners on mainstream agencies complacently unaware of how clients were growing increasingly frustrated at being unable to find the right creative solutions within the conventional industry set-up.

The man who put the skids under them and forced their transformation from what one critic called "a bunch of dinosaurs acting like ostriches" was a one-time Universal Studios tour guide called Michael Ovitz.

Through Creative Artists Agency, which he helped launch in 1975, Ovitz had become one of Hollywood’s most powerful figures, handling stars such as Tom Cruise and directors including Steven Spielberg.

Energetic and a relentless networker, Ovitz grew CAA rapidly, expanding it from film into TV, investment banking and, via his decade-long wooing of Coke, advertising.

So canny had Ovitz been in ingratiating himself with key figures at Coke that McCann had no idea about Ovitz’s coup until it was too late.

In fact, so dazzling was his presentation to Coke senior executives that John Bergin, then the McCann vice-president who was sat in the room, slipped a note to a colleague saying: "We are dead."

However, the sceptics who questioned whether a talent agency could compete with an experienced Madison Avenue giant were ultimately proved right. While CAA had once opened doors for Coke, its usefulness – and its support within the company – eventually waned. Coke formally ended its relationship with CAA in November 1995 but signed on again in 2000 and has been a client of CAA Marketing since.

Things you need to know

  • Ovitz went on to be the president of The Walt Disney Company from October 1995 to January 1997. He still works as a talent agent and is worth a reported $400 million.
  • CAA’s most famous TV spot for Coca-Cola was "Northern Lights", featuring computer-animated polar bears drinking Coke.
  • Coke’s principal global agency partners are McCann Erickson and Ogilvy & Mather, although the company also works with local agencies around the world.