Ad Agencies

Giana Eckhardt and Adam Arvidsson

Forthcoming in Consumption Markets and Culture

For Marketplace Icons series

Abstract

This article highlights advertising agencies as marketplace icons. The role of ad agencies in
creating iconic brands can sometimes be obscured, yet ad agencies are central to how the
contemporary marketplace works. While ad agencies are no longer the hegemonic instance of
consumer culture that they were from the 1950s to the 1990s, they have adapted to today’s
proletarianized advertisingscape. They remain the engine behind significant shifts in consumer
culture, such as the warming of relations between music and advertising, which has ideological
implications.

Keywords: advertising agency, marketplace icon, consumer culture

The Mad Men tv series, which aired from 2007 to 2015, featured the golden age of advertising in
New York City: the 1960s. Fueled by martinis and cigars, these masters of the universe were
busy creating the campaigns and symbols that still resonate with us today: the iconic ‘I’d like to
buy the world a Coke’ campaign, for example, which is one of the most popular advertisements
of all time, and solidified the Coca Cola brand as representing happiness on a global scale
(https://www.youtube.com/watch?v=2msbfN81Gm0). Agencies today, on the other hand, play a
much smaller role in creating content, instead acting more like midwives, collating and
distributing cultural content produced by others. In exploring ad agencies as marketplace icons,
we contrast agencies from advertising’s golden age as a hegemonic instance with today’s agency
as having adapted to proletarianized advertising scapes.

Advertising Agencies as central to consumer culture

Mad Men brought about a renewed interest in the role that ad agencies play in contemporary
marketplace culture. For most of the last century ad agencies have been a key player in fueling
contemporary consumer culture, and thus an important marketplace icon. Modern advertising
agencies developed after the First World War to accompany the growth of American consumer
society. Agencies had been around since the 1880s when the new ‘penny press’ expanded
newspaper readership to the masses and created a market for advertising space. In the 1920s the
business was consolidated and its image was cleaned up. The pre-War ‘huckster’ was replaced
by the modern advertising man, a professional in the service of commerce, dedicated to the
laudable goal of ‘making way for modernity’ (Marchand, 1985). As advertising found its place
as a necessary institution in the machinery of mass consumerism, with the crucial role of
inserting new products into the life worlds of consumers it also found a standardized method.
Developed by Helen Resor and John B. Watson- the behavioral psychologist- at J.Walter
Thompson, modern advertising was not supposed to simply show the product but show
consumers how it could improve their personality or social life (Arvidsson, 2001). Resor and
Stanley developed a stimulus response approach to advertising: first stimulate a need by pointing
to risks and insecurities that are inherent in modern life: their advertisements for Lux Soap would
start out with a young woman finding out that the reason she could not find a suitor was because
of her overwhelming body odor. Then propose the product as a solution: washing her undies in
Lux soap, ‘undie odor’ went away and the young men arrived. In this way one of the
cornerstones of modern consumer culture was put in place: Consumption is not about stuff, it is
about you, it is about what you can become with stuff, how it can transform you, make you a
little bit better, nicer, more popular.

In the 1950s, the decade of Don Draper’s early career, the American advertising agency spread
across the world, as large multinationals like J.Walter Thompson and McCann- Ericksson
expanded into the markets of Europe and Asia (J.Walter Thompson had made an effort in the
1920s but had to close many of its foreign branches in the wake of the Depression). With it came
standardized methods of market research and a standardized advertising aesthetic that, via its
impact on the magazine market, came to largely structure consumer culture across the world.
Advertisements and accompanying media products were addressed to a limited typology of
consumers, the middle class housewife, the young glamour girl, the modern successful executive.
In countries like Italy and France, the surviving pre-War tradition of advertising poster art was
quickly relegated to niche markets. The process of normalization even encompassed J. Walter
Thompson developing a standardized approach to ‘creativity:’ the T-square model within which
all ‘creative’ advertising thinking should be framed.

As the American way of advertising succeeded globally it began to be undermined at home.

Marshall McLuhan attributed this to television that, he argued, would make people’s relations to
goods more intimate and personal and call for a differentiated approach. In reality several other
factors played in: the maturity of the American middle class consumer – or at least the perception
of such maturity on the part of advertising professionals. According to the new gurus of market
research, the first affluent generation of the American middle classes now desired goods not for
their utility but for their ability to create and articulate personal identity (Levy 1959). Along with
this came the explosion of the youthful counterculture and the many lifestyle innovations that it
spurred. Importantly, the shift in market research, from demographics to psychographics or
lifestyle segmentation, gave a better reflection of evolving niches and consumer trends. This
environment led to a ‘creative revolution’ in advertising. Agencies like Doyle Dane Bernbach
(DDB) diversified the language and aesthetics of advertising, bringing in themes from the
counterculture, women’s lib, and the many new health and sports related lifestyles, like jogging,
that mushroomed in the ensuing Age of Narcissism (Lasch, 1978). Advertising agencies now
came to better reflect and incorporate the diversity of consumer culture. But it did so within a
new common frame, the contemporary brand.

The shift from advertising products to building brands altered the dominant modus operandi of
advertising agencies. It was now less about inserting products into a common consumer
mythology, and more about building cultural artifacts, including lifestyles, experiences and
sensibilities around brands. This also widened the repertoire of cultural intervention on the part
of advertising. Along with advertisements proper, marketing strategies shifted to creating new
identities and communities. Ad agencies come up with the creative hooks which came to define
brands in the popular imagination. Holt (2004) notes that identity myths are central to the way
iconic brands are built and managed today. Thus, the agency’s role changes from trying to
influence consumer perceptions of the brand, to creating a storied product, through which the
consumer can experience the identity myth. Cayla and Eckhardt (2008), for example, show how
agencies get brands to function as symbolic devices, helping to create shared imagined worlds.
They demonstrate how agencies contribute to the social construction of markets by producing
transfigured ideas of social categories (in their case, what it means to be Asian). In choosing
creative direction and particular forms of symbolism for the brands they are working on,
agencies play an active role in shaping cultural categories such as Asianness.
What is the role of ad agencies in today’s marketplace?

However, the era of the full service ad agency as the central institution of consumer culture is
coming to an end. In the 2000s advertising has been ‘proletarianized,’ to use the expression of a
copywriter interviewed by the second author in the midst of that decade. The multiplication of
advertising space on the Internet has lowered the price of advertising and generally shifted
budgets away form television and print media to digital, and more recently mobile advertising.
Add to this the rise of specialized media bureaus and the virtual monopoly that social media
companies like Google and Facebook exercise over online (and increasingly also mobile)
advertising, and the result is that the media brokerage commissions that advertising agencies
traditionally lived on have been significantly reduced.

The second tangible source of income that ad agencies traditionally had, the actual production of
advertisements has also evaporated. Graphics software, video editing, photoshop and similar
software have rendered the capacity to actually produce an ad common: ‘Any kid with a
Macintosh can do it,’ as the interviewed copywriter put it. The result has been increasing capital
concentration as giants like the WPP (Wire and Plastic Products- a company that started out
manufacturing shopping baskets) has bought up agencies to become global advertising
conglomerates, and less space for creativity and innovation as shrinking margins have made the
climate more risk adverse. To continue in the words of our copywriter:

When I started [in the 1980s] we had wine on Tuesdays, and then on Thursdays and Fridays too,
and if we got a new customer we had Champagne... it was a bit on the heavy side. Today it’s much
more orderly and you have to document everything that you do. Then we used to live off other
things, the actual production of things, advertisements, booklets and such. Today its pure
creativity and that has to be documented, (Arvidsson, 2007:13)

That ad agencies are no longer are as exciting as they used to be does not mean that their
influence has disappeared. Television is still the largest destination for ads spend world-wide
(although internet and mobile are growing quickly), and most of television advertising is still
handled by traditional ad agencies. But the advertising agency is no longer the ‘hegemonic
instance’ of consumer culture, to use the parlance of cultural studies. In part this is because of the
proliferation of a number of smaller agencies that specialize in the kinds of things that ad
agencies have traditionally not been doing: digital marketing, word of mouth marketing, event
marketing, guerilla marketing, and so on. Mainly it is because advertising as a form of cultural
production has been generalized: In a ‘promotional culture,’ as Wernick (1991) has noted, the
distinction between advertising and ordinary cultural practice has disappeared. Consequently a
lot of marketing today makes use of ordinary people’s promotional activities, inserting
commercial messages in twitter feeds, identifying ‘influentials’ on blogs and social media, or
consists of engaging in ordinary forms of cultural practice: sponsoring events and festivals,
placing products in films and television shows, creating music and video, or initiating trends,
memes or movements. The centrality of the ad agency has been superseded because advertising,
in a sense, has expanded to encompass culture as a whole.

Yet agencies have adapted to the proletarianized new advertising scape. In many ways the ad
agency is now a ‘market midwife’ (Penaloza and Thompson 2014), shepherding cultural content
produced elsewhere to market. Agencies have had to come up with new sources of value to
adapt. We can see this when examining how the use of music in advertising has changed, from
agencies’ golden age to the modern era.

Music in ads used to be considered selling out, by both the band themselves as well as
consumers, as using art to sell things offended aesthetic and bohemian values. But now ads are a
key vehicle to reach an audience. With the breakdown of the music industry in a post-Napster
world, ad agencies have become key players in breaking new artists via using their music in
advertisements (Eckhardt and Bradshaw 2014). Agencies no longer are simply cool hunters,
being on the cutting edge of what is untainted by corporate association, but they have evolved to
be trendsetters, commissioning new music to be used in ads, which eventually become chart
toppers (Eckhardt and Bradshaw 2014). Musicians turn to agencies as a key culture broker for
getting their music to an audience, and consumers turn to ads as a main vehicle to discover new
cutting edge music. Thus, agencies can use their position as the middle man, between bands and
brands, as a key way to add value to clients. And their ability to use even the most iconic or
cutting edge music in campaigns for their clients has never been higher.

This non-problematic marriage between music and ad agencies represents an important social
shift that has ideological implications, in terms of the marriage between art and commerce.
Agencies become the ‘midwives’ between art and commerce, facilitating new cultural practices
in the process. Thus, ad agencies remain key players in creating these types of society wide
shifts. While agencies are no longer as hegemonic in terms of the production of consumer culture
as they used to be, their influence is still wide and deep, as evidenced in their emergence as the
key channel through which to break a new band. Agencies still have the cultural sweep and
power to galvanize society-wide shifts. The techniques they pioneered are being used by the
everyman, creating promotional YouTube videos in his garage. And agencies continue to find
new sources of value they can add to clients to remain relevant, which often still have seismic
impacts on consumer culture in the way they did in the golden age of the agency.

In the words of legendary ad man Leo Burnett, “The work of an advertising agency is warmly
and immediately human. It deals with human needs, wants, dreams and hopes. Its 'product'
cannot be turned out on an assembly line.” Long live the Mad Men.

References
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‘underground,’” Ephemera, 7(1), 8-23.

Arvidsson, Adam (2001), "Between fascism and the American dream: Advertising in interwar
Italy." Social Science History 25.2: 151-186.

Cayla, Julien and Giana Eckhardt (2008), “Asian brands and the shaping of a transnational
imagined community,” Journal of Consumer Research, 35(2), 216-230.

Eckhardt, Giana and Alan Bradshaw (2014), “The erasure of antagonisms between popular
music and advertising,” Marketing Theory, 14(2), 167-183.

Holt, Douglas (2004), How Brands become icons: The principles of cultural branding,
Cambridge: Harvard Business School Press.

Lasch, Christopher (1978), The Culture of Narcissism, New York: Norton.

Levy, Sidney (1959), “Symbols for sale,” Harvard Business Review, (July-August), 117-124.

Marschand, Roland (1985), Advertising the American Dream, Berkeley: University of California
Press.

Penaloza, Lisa and Alex Thompson (2014), “Constructing the visual consumer,” in The
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Schroeder (eds.), New York: Routledge, p. 79-95.

Wernick, Andrew (1991), Promotional Culture, London: Sage.