The US: Small is beautiful

Small shops are springing up and wresting big chunks of business from the US agency giants with nimbly executed and innovative ideas, Ann Cooper reports.

In the US, the old adage "small is beautiful" is back in vogue. One need only look at the number of new, small agencies specialising in non-traditional and distinctly quirky ad campaigns.

Sprouting up over the past two to three years, such agencies have been winning big at the expense of the agency behemoths. Just recently, the Miami-based Crispin Porter & Bogusky snared the $400 million Volkswagen account (formerly at Arnold Worldwide) without a pitch. Before that, it landed and kept the $335 million Burger King account. Mother New York has added a chunk of the brewer Miller's business to LVMH's 10 Cane Premium Rum, while New York's Amalgamated won the $50 million Cablevision Optimum account.

StrawberryFrog, which handles Heineken globally, launched the Boomer Coalition campaign to raise awareness of cardiovascular disease last year and recently netted a piece of Old Navy business. The Boston-based Modernista has worked for Gap for some time. The Seattle-based branded content specialist Wexley School for Girls does project work for Nike and ESPN, and Taxi snatched the $60 million Amp'd mobile phone launch. And, at the time of writing, the New York-based Anomaly was a finalist for the $70 million BMW account.

So, what's going on? "You have a smarter client today," Paul Lavoie, the founder and chief creative officer of Taxi, says. "Smarter clients are not blinded by the business. Going to smaller agencies is no longer a risk. We have a lot of resources and a back-up infrastructure in Canada, so it's not just 12 people working on your account." Taxi handles Mini in Canada from its Toronto headquarters.

Jeff Hicks, the chief executive and president of Crispin Porter, says it was the agency's small size that attracted him when he joined from Leo Burnett in the late 90s. "I believed the logic of scale was diminishing as a merit in this business," he says. "The best ideas don't come from a place with more resources. They come from smarter, more passionate people."

One reason big clients are growing more comfortable with smaller shops is because of the way technology is changing the industry. "Two people can make an ad in a way that used to take 17 people," Guy Barnett, the co-founder of the creative collective The Brooklyn Brothers, says.

Clients also look to smaller shops for something different creatively. "We're the little guys," Ian Cohen, the co-founder of' Wexley School For Girls, says. "Clients call us in to shake things up, which is flattering. We're only eight people, and we're pretty concept-based, so it's tight and we do so many different things."

And economies of scale are no longer the attraction that they once were.

"In the 80s, big agencies used to say 'come with us because we can get economies of scale'," Douglas Cameron, the director of strategy at Amalgamated, says. "Truth is, there are very few economies of scale in advertising. Research tools are just as available online to small agencies as to large ones."

One reason StrawberryFrog has been successful at winning accounts is because it is nimbler and faster, Kevin McKeon, who recently joined the agency as a partner and executive creative director, argues. "Clients want agencies to be more cost-efficient, faster and more diverse, and the bigger agencies have a harder time doing that. An agency like ours is faster on its feet. The old metaphor of the big agencies being like battleships trying to turn themselves around is true."

While going with smaller shops is hardly a new trend (Coca-Cola led the way back in 1991, when it moved business from McCann Erickson to Creative Artists Agency), the difference now is the number of big clients that are doing it.

As for the work coming out of small shops, whether it's Crispin Porter's hugely successful "subservient chicken" website for Burger King, or Amalgamated's "girls gone wild" efforts for the music channel Fuse, which caused a stir by parodying Apple, the results are often hard to ignore.

Not that the big agencies are exactly quaking in their boots. "Nobody cares about size," Dave Lubars, the chairman/chief creative officer at BBDO North America, says. "They care about who's going to give them a huge idea and be an economic multiplier. Clients are not going to hold it against big agencies either. We're like a global boutique working with incredible speed and lots of big ideas. We have a mass and a pool of talent that's unmatched because of our size."

The network has recently picked up the Motorola ($100 million), Lowe's ($315 million), Mitsubishi ($200 million) and Ebay ($60 million) accounts, among others.

The New Yorker writer Malcolm Gladwell made famous the theory of "the tipping point" in his novel of that name. And many small agencies today have long since passed that point. Large agencies beware.