CLOSE-UP: LIVE ISSUE - D'ARCY. Once-great brand hits bottom after a long decline

D'Arcy's heyday was in the 70s, before it began losing clients.

If there's one thing that D'Arcy knows about, it's the impact of mergers. From its formation in the US in 1906 to its demise last week, the network went through more guises, restructures and facelifts than Michael Jackson.

However, the latest, at the bidding of its new owner, Publicis Groupe, means the D'Arcy name will disappear from the advertising landscape. What was once the sixth-biggest network in the world has been in decline for the past ten years, a terminal blow being the loss of its £76 million flagship Mars account earlier this year.

The Publicis chairman, Maurice Levy, has recognised that four global networks are unsustainable and has axed the weakest one in his portfolio.

Publicis, Leo Burnett and Saatchi & Saatchi will absorb staff and share clients, although extensive redundancies are likely among 6,000 staff in 72 countries.

Five years after William Cheever D'Arcy opened his St Louis ad agency in 1906 with $3,000 worth of business from Coca-Cola, Theodore MacManus opened MacManus in Detroit with General Motors' Cadillac account.

Benton & Bowles opened at the start of the Depression in 1929 to capitalise on clients' need to find new ways of shifting products in difficult economic times. It was Lord & Thomas, the UK agency that became Masius & Ferguson, and brought the network's signature Mars business to D'Arcy.

In 1970, MacManus merged with D'Arcy Advertising in the US to form the world's eighth-largest agency, D'Arcy MacManus. In 1977, European billings and a true global network offering were brought in with a Masius merger.

The move supplied huge billings and consolidated a number of global clients including Mars, Anheuser-Busch, Procter & Gamble and Coca-Cola.

And despite criticisms of creative mundanity, D'Arcy had some shining moments in the UK. Its work on the COI Communications roster, which it joined in 1991, garnered awards for, among other campaigns, its Drink Drive advertising. D'Arcy's "work, rest and play" for Mars is one of the most famous ad slogans of all time, while more recently, its work for Maltesers has taken numerous awards.

This was D'Arcy's heyday. It had a reputation for looking after its staff and its clients in equal measure. So how did a brand that created the "frogs" spot for Budweiser, married a red-and-white Father Christmas to Coca-Cola and handled Mars' advertising for 60 years fall by the wayside?

The president of the American Association of Advertising Agencies (the equivalent of the IPA), Burtch Drake, says the network has been losing strength in the US for some time, and the loss of key accounts such as Budweiser in 1994, which it held for 80 years, and Mars this year further eroded confidence in the brand. "I hate to see a great name like D'Arcy disappear, but if New York doesn't work, a network has problems," he says.

In the US, the agency came to be associated exclusively with multinational clients and "factory" output, a feature that too often dissuaded top talent from joining.

Logistical mistakes also cost the network dearly, as one former executive explains: "Closing the St Louis office (the city in which the agency was born) earlier this year was a huge mistake and tested an already frail relationship with Mars (which was miffed about the manner in which it was consulted about the closure). And working on an assignment for the rival brand Miller, clearly a conflict to Budweiser, cost the network its Anheuser-Busch account globally."

Another former executive blames a lack of senior management with concrete client relationships for debilitating D'Arcy. Mars fired the network and the signs are that a second key global client, P&G, is unhappy. This was signalled by D'Arcy's loss of the P&G Pampers brand in the US last year. It is also unlikely that Levy would have shut D'Arcy without P&G's assent.

As well as hints of the network's complacency over heavyweight clients, there is also criticism that the worldwide president and chief executive John Farrell's experience lies more with marketing services than advertising. Indeed, since the closure, Levy has offered Farrell the task of running Publicis' marketing services offering.

The former joint managing director Tony Douglas, who ran the newly merged DMB&B in the UK with Graham Hinton from 1985 to 1995, warns that the new, slimmer holding company will face a great deal of activity in the coming months. He remembers the year following the 1985 merger between DMM and Benton & Bowles, when half the UK agency's clients reviewed their business.

"Clients don't like change they have not instigated, and now is a crucial time for those key pieces of business," he says.

Douglas is unsurprised but saddened by Levy's decision. "D'Arcy was a brand with fantastic equity, and it has been allowed to die. Clearly a fourth network was unsustainable, but keeping the D'Arcy name alive in some form would have offered reassurance to clients and staff at such an unsettling time, and enabled Publicis to capitalise on its heritage."

But Farrell is more sanguine, "This isn't about a failure of D'Arcy - it's about Publicis creating the best opportunities in a competitive time."

BEGINNING TO END

1906: D'Arcy Advertising founded by Bill D'Arcy with $3,000 of

Coca-Cola business

1911: Theodore MacManus founded MacManus in Detroit

1922: Lord & Thomas, later Masius Wynne-Williams, founded in London

1929: Benton & Bowles set up by William Benton and Chester Bowles with

two accounts from General Foods

1970: D'Arcy merges with MacManus

1973: Masius and D'Arcy form partnership before merger in 1977, to form

D'Arcy MacManus & Masius Worldwide

1985: DMM merges globally with Benton & Bowles forming world's

sixth-largest agency

1999: D'Arcy merges with the Leo Group to form BDM

2000: Dentsu takes 20 per cent in BDM to form Bcom3

2002: Publicis acquires Bcom3 and merges D'Arcy into its other networks

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