The chief executive of Ogilvy & Mather Worldwide runs her global
empire of 377 agencies in 97 countries from a splendid tenth-floor
corner office in New York. It is decorated with hundreds of toy frogs.
By any reasonable standard of advertising decorum, this is not the way
for the sharp-suited and neatly coiffed 51-year-old leader of the
world's tenth-largest advertising brand to behave. An office like that
of Interpublic's Phil Geier, with its acres of modern art, yes. Or one
full of antique furniture and Ralph Lauren, like that of Young &
Rubicam's Peter Georgescu, perhaps. But frogs - china ones, checked
ones, knitted ones, no.
I know I will have difficulty framing any sort of polite remark until I
get it over with. Hey Shelly, what's with the frogs?
Before answering, she strides across the office to pick up a specimen
that a client recently sent her from the Midwest. Press the right button
and it croaks. She does so and laughs ebulliently: 'For my first wedding
anniversary, I bought my husband a frog that said 'I'm mad about
A week later, George bought me one back, then we kept buying frogs for
each other. Now I can't stop them coming in, three or four a week, from
all over the place.'
Anyway, Shelly Lazarus, Campaign's first Queen of Madison Avenue. The
mother of three children, aged 11, 19 and 24, she is married to Dr
George Lazarus, a pediatrician. She succeeded Charlotte Beers as chief
executive of O&M in 1996 after a 25-year career at the 50-year-old
agency. She has a BA from Smith College and an MBA from Columbia
University. After Columbia she joined Clairol as an assistant product
manager. Two years later, in 1971, she was approached by O&M. 'Two years
at Clairol had made me a hair expert,' she says with a grin. 'O&M needed
someone on their hair account. I figured I'd stay two years.'
I ask about her feelings on the O&M brand when she joined, and now.
'They are not all that different,' she replies. 'When I came, David
(Ogilvy) was still here a lot of the time. I found an organisation
staffed by decent people with strong beliefs and an extraordinary
commitment to clients.
'A few years ago there were people here who suggested that the David
stuff had become irrelevant,' she recalls. 'Someone even tried to
rewrite his thoughts in more relevant English! But that made others say
'that's hogwash', we should reaffirm David's principles.'
Given that New York is where the power lies - it employs 1,200 staff and
commands half of the US network's dollars 2.6 million billings - most
people would expect the agency there to represent the epicentre of
Ogilvy's famous culture. Is this true?
'Yes, in the sense that David started the agency here, you have a lot of
the senior people here and traditions like the bagpiper at Christmas.
But I think that some of the smaller agencies are more 'true Ogilvy'
than New York - in the intensity of the culture and the shared point of
All this talk of institutionalised principles, continuity and shared
values belies the rough times that Lazarus has seen in her long career
at O&M. WPP's purchase of the network in 1989 marked the end of a
dramatic bidding war that had led to an inflated purchase price of
dollars 864 million.
From his 12th century French chateau, the retired Ogilvy famously
opined: 'God, the idea of being taken over by that odious little jerk
really gives me the creeps. He's never written an advertisement in his
More troubling, however, was the weak management, the departure of
senior executives (the chief executive, Ken Roman, resigned shortly
after the takeover) and the loss of clients: Shell, Unilever, Seagram's
Coolers and Nutrasweet, Campbell's Soup, Amex. With revenue off budget
by 40 per cent and operating margin at a measly 4 per cent, Charlotte
Beers, chief executive of the Chicago agency, Tatham-Laird & Kudner was
appointed to turn round O&M's fortunes.
Lazarus recalls returning to the advertising agency in 1991, soon after
Beers was appointed, following her successful stint as president of O&M
Direct in the US. 'Direct was growing well,' she says. 'Staff were
clamouring to join, clients were waking up to direct marketing. Then I
came back to O&M Advertising. We were losing people, morale was low, we
were in trouble on our big clients.'
Recalling this bleak time, she is characteristically honest: 'I'd have
nightmares about everyone leaving on the same day and me turning up for
work at the agency to find no-one there!'
Amex did take its dollars 60 million business to Chiat Day but O&M won
it back, which brings us to her most satisfying moment in the business:
'Turning everything round. Winning Amex was the validation.' So how did
she pull it off?
'We just stayed with the brand when Amex went to Chiat Day. Chiat Day
wanted Amex to be young, hip, cool and trendy so they created
irreverent, cynical advertising. And the clients hated it because it
'Staying with the brand' is what Lazarus, who has managed some of O&M's
flagship accounts - including Amex, Unilever and AT&T - is about. She
has a reputation as a patient business strategist who is prepared to
work hard to build relationships with senior clients. No-one felt the
loss of the Amex account harder than Lazarus, who spent six years as
group account director on the business and led the chase to regain it.
The key to the comeback was her links with the Amex boss, Lou Gerstner,
and his marketing chief, Abby Kohnstamm. In addition, Lazarus
commissioned new research, rehired Bill Gray from BBDO to run the
account and was rigorous with creative work. Not only was the business
back at O&M within 11 months but, when Gerstner and Kohnstamm moved to
IBM in 1994, O&M scooped its dollars 500 million global business too. It
was the biggest single account switch in advertising history.
IBM is now a blueprint for the network in the sense that, like Amex, it
has an individual client profit-and-loss line across the group companies
that work on the business. So what has this taught Lazarus in terms of
managing the in-fighting between managers, who are inclined to put their
own performance and their own client relationships before the greater
good of the network or WPP?
'It's really very simple. IBM pays for a scope of work and, with a
single profit-and-loss line, how we split fees and allocate costs is not
an issue. We are all encouraged to find the smartest solutions with no
financial incentive one way or the other.'
It is such incentives for co-operation across the network that WPP,
plotting from its headquarters in Farm Street, wishes to maximise, thus
making the parent company much more than a mere financial brand. On the
other hand, it's no secret that WPP's group chief executive, Martin
Sorrell, is never satisfied with the status quo and has a sometimes
prickly relationship with his agency managers.
In O&M's case, there are two pieces of evidence to support this view:
the method of appointment of someone to the new post of group chairman
for O&M London, and the launch - or not - of MindShare in the US.
Even before the resignation last week of its chief executive and deputy
chairman, Tom Bury, who was not considered for the post, it was clear
that the job of group chairman for O&M London was earmarked for an
A simple matter of poaching one of adland's pounds 250K-a-year
heavyweight managers, you might think. But everyone knows that WPP - as
facilitator, catalyst or bully, call it what you will - is likely to
play a leading role in the appointment. In a business where all aspects
of people management are considered by agency chiefs to be central to
their role as manager of their own business, such intrusion from outside
- even when 'outside' is the parent company - must seem a blow to
And so to MindShare. WPP's European media brand was formed in 1997 out
of O&M's the Network and J. Walter Thompson's media department. Although
WPP has already combined television buying negotiations for its O&M and
JWT agencies in the US, in a venture called the Alliance, one question
is going begging. When will MindShare launch in the US?
'The Alliance has been very successful for us, we were a little earlier
than you guys with pooling media, and we could change our name to
MindShare tomorrow ...' Lazarus hedges. So will she?
'We might but that's not particularly interesting to me. We have to keep
looking at it. The US media market is very different to the UK. Media
independents have not been terribly successful here. What we have to do
is figure out how we can retain the brand insight while moving beyond
buying. The Alliance is already working well for our clients, it's also
driving costs down.'
Meanwhile, Sorrell is looking at groups such as Rupert Murdoch's News
Corporation that are building increasingly powerful multimedia
He wants to offer advertising's equivalent: clout, volume and power via
a single media brand.
With this in mind, I persist with the question: WPP wants her to launch
MindShare in the US - so does Lazarus have a timescale in mind? 'No,'
she replies. 'I know that WPP believes there is value in having a global
media company. I know they started thinking about it in London where all
the big media companies are independent. But I'm in the US, the
recipient of that thinking, where media independents haven't been that
Therefore, we move from WPP's pet project to one of Lazarus's own: Brand
Stewardship (which was introduced by Beers at the end of 1992) and its
newer expression, 360 Degree Branding (which is, as one O&M insider puts
it, 'Shelly's thing').
Based on an audit of a brand, both seek to uncover the emotional
subtleties and nuances by which brands exist. Both promise long-term
custodial care for brands that have been managed by a revolving group of
client company managers. Both express a belief that the value of an
agency to a client begins and ends with the brand - at its every point
of contact with the consumer, not just the execution.
Nice new-business tools, perhaps, but can they lead to better work?
'If you believe that the role of the agency is to build and magnify the
brand, then insight about the brand should give you a clearer route to
what you want to say in the advertising. It's been liberating for us on
Dove and Maxwell House,' she enthuses. 'And it frees creatives to do
very intuitive advertising.'
These are fighting words indicative of Lazarus's approach to managing
people. 'When I arrived at O&M in New York all the decisions were made
at the top, which I changed,' she reports.
I ask her views on Ford and Guinness, the two account losses which cost
Tom Bury his job.
On Guinness, Lazarus is adamant: the client never liked the work:
'Although the advertising world valued the Guinness work, my impression
is that the client never liked it. I've seen instances where agencies
will present daring work and initially the clients are nervous, but you
convince them over time. Guinness never got more comfortable with the
work. And I don't believe that we should ask clients to live with
advertising that they aren't proud of because that is the visible face
of their brand.'
She is more familiar with Ford. 'I have less of an explanation for the
loss of Ford,' she says. 'We did some wonderful work for them and they
didn't like it. I think we missed the fact that they were changing as a
company but we weren't changing.'
'In fact,' she continues, 'I have a great respect for the way Ford did
it. They realigned things into Y&R but they still left us with an
enormous piece of business (O&M handles Ford's dealer and commercial
business, as well as the Mondeo and Escort). They could have done it
more brutally but they did it as if to say 'Let's start again, we want
it to work.''
Who knows, I venture, Ford may return to O&M some day: 'Well,' she
laughs. 'I've made a career out of it ... Amex, Ponds, Maxwell House ...
I'm just hanging in there!'
It is therefore no surprise to hear Lazarus argue the merits of organic
growth over the competitive pitch. 'That's been the philosophy of this
agency from the beginning,' she asserts. 'I would like to see us expend
99 per cent of our efforts on current clients. If I could stop everyone
from pitching for new business, I would. I can't because I don't manage
that way. But the emotional impact when an agency loses a beauty contest
pitch is long and deep.'
And yet it is international clients - big global ones like IBM and Amex
- which the O&M network needs if it is to continue to meet WPP's targets
Kodak was a good fillip in 1997 but last year brought two setbacks for
the network - dollars 30 million worth of Shell International business
left for JWT, and then there was Ford. The challenge of landing a couple
of big global clients looks set to be Lazarus's toughest over the next
- Since this interview was published in January 1999, MindShare has
launched in the US and O&M has won back lead agency status on Ford