Editor's note: An earlier version of this story contained a typo in the figure for McCann Worldgroup's global revenue. The correct figure is $530 million.
DETROIT -- Detroit's automotive advertising agencies have had a rough few months, with Campbell-Ewald's loss last month of Chevy after nearly a century, BBDO Detroit shutting down in January and W.B. Doner & Co. scrambling to defend Mazda.
But finally, some better news.
The suburban Detroit office of McCann Worldgroup has quietly undergone something of a renaissance. It has seen revenue grow and hired 150 new staffers in the past six months, bringing headcount to about 400 while most of the local large agencies have been shedding jobs as work left town.
The office, turned this year into a regional hub for McCann Worldgroup and home to several specialized agencies such as McCann Erickson, is General Motors Co.'s largest global advertising agency.
Like most agencies in metro Detroit, McCann is seeking to diversify its client base, and new accounts and a regional approach have sparked the hiring.
Many of the new jobs are with McCann's internal digital marketing unit, MRM Worldwide, said Garry Neel, the office's president and CEO.
“A big part of our business is digital,” said Neel, who is also GM global director for McCann Worldgroup. He's worked at the local office for a decade.
Most of the hiring stems from GM's cost-cutting decision last year to shift its digital production duties to MRM from Digitas-owned Prodigious Worldwide. There is also new parallel hiring at MRM's Argentina office for the GM work, which includes creation of 50 new Web sites for GM brands in Europe, South Africa and the Middle East this year.
The five-year deal is worth $100 million in billings, according to Advertising Age, an affiliate of Automotive News.
It's believed the agency switch resulted in less than a dozen Digitas layoffs between Detroit and Boston.
To bolster the diversification and expansion, McCann last week hired Barbara Yolles as its chief marketing officer. Yolles, who will start on May 25, was with Doner in Southfield for six years before taking an executive vice president job at New York City-based Kirshenbaum Bond Senecal & Partners.
McCann already picked up new accounts in recent months such as discount grocery giant Aldi Inc. and The Colonial Williamsburg Foundation.
“That new business for us has been what's helped us thrive,” Neel said. “We want to ratchet it up to the next level.”
That includes pursuing work in non-automotive categories such as big-box retail, financial services and health care, but being in a city whose advertising industry is so closely linked to the automakers is a challenge.
“We're fiercely proud of being in Detroit,” Neel said. “When you're based in Detroit, new business doesn't find you, you have to go chase it.”
More GM work
While looking to add more non-automotive clients to shield itself from the industry's woes, McCann will continue to seek more GM work, Neel said.
“That always remains our first priority,” he said.
McCann handles Chevy and Cadillac in 60 countries that include lucrative emerging markets such as China, India and Latin America. It also handles GM's corporate work and retail advertising, such as employee discounts, along with Sirius XM satellite radio and Saab, which is believed to be worth about $55.5 million.
Also helping fuel McCann's growth is GM's increased post-bankruptcy advertising spending that has included the “May the Best Car Win” corporate campaign that involves most of the automaker's brands. The automaker spent $3.6 billion worldwide last year on advertising, a number that's expected to increase this year as it rolls out six new vehicle campaigns.
The upswing is a change for McCann, which took its lumps in the agency shakeups of the past few years.
It lost the $122 million Buick account in 2006 after 50 years to rival agency Leo Burnett in Troy and Chicago, and was eliminated in November as a candidate for the $270 million Cadillac account that went to the New York office of British creative agency Bartle Bogle Hegarty. GM briefly moved its corporate ad account to Los Angeles-based Deutsch in 2007 but gave it back to McCann two years ago.
“We've gone through a time patch with our clients in terms of their business,” Neel said.
Weathering the storm
Industry watchers say the agency has weathered the auto industry maelstrom well.
“(McCann) hasn't been tainted by being associated with GM,” said Peter DeLorenzo, a former automotive advertising executive who now is publisher of the autoextremist.com industry blog.
“They basically got the shaft when Buick was summarily removed from them for no reason whatsoever, in my estimation. It remains to be seen if they can get back what they lost.”
A rival ad firm assessed McCann as the least troubled of General Motors' marketing agencies.
“Of all the GM shops locally, they seem to be pretty well positioned,” said George Rogers, CEO of Team Detroit, the consortium of WPP Group ad shops that work together mainly on Ford Motor Co. and have 50 positions to fill among about 1,200 employees.
Rogers did warn that things remain unclear for GM's advertising agencies. “The merry-go-round agency shuffle hasn't stopped. I don't think anything is solid on the GM side.”
McCann Worldgroup's most recent revenue reported by Advertising Age this year was $530 million globally. It's believed that the local office accounted for about $50 million last year, and that's up about 20 percent from the year before.
The office became known as McCann Midwest this year, and it includes McCann Erickson, the advertising agency; MRM Worldwide (digital); Momentum (experiential marketing); and Weber Shandwick (public relations).
“We've kind of taken that on as our regional hub,” Neel said, noting that the office is the only McCann location between New York City and Salt Lake City.
Tight on space
The local office will serve Midwestern-based clients as appropriate, Neel said. A new Web site will be rolled out this year, but the company logo won't change.
“We haven't made a splashy announcement,” he said.
Two of McCann's largest local rival agencies, Campbell-Ewald and Doner, both have launched new agency branding efforts to coincide with top executive transitions.
McCann's Detroit area office, carries the McCann Worldgroup nameplate mounted outside. That's the advertising holding company parent of all the agencies inside the office, which in turn is owned by an even larger global advertising mega-holding company, New York City-based Interpublic Group of Cos.
With the new hires, space is at a premium in McCann's office -- a departure from what many agencies are going through.
“We're pretty much at capacity here now,” Neel said. “We've got more people than the space was designed for.”