Fallon Worldwide (US)

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Fallon established a reputation as one of America's most admired creative agencies in the late 1990s, in the culmination of a process that began when founder Pat Fallon reinvented his company at the beginning of the decade, buying it back from WPP and quadrupling billings in just three years before selling for the second time in 2000, this time to Publicis. That deal allowed Fallon to expand its presence around the globe with outpost such as Fallon London. By mid-decade, however, the core US agency had begun to struggle with a series of account losses, and was overshadowed by its UK office, which was then enjoying considerable critical acclaim in recent years as a result of stunning work for clients such as Sony, Orange and Cadbury. In 2007, Publicis Group established a closer partnership between Fallon and larger stablemate Saatchi & Saatchi under a shared umbrella structure, known as SSF Group. Fallon's performance in the US has remained bumpy since then, but the London office has suffered an alarming slump since 2010. 

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Recent stories from Adbrands Weekly Update:

Adbrands Weekly Update 28th Jan 2016: Ads of the Week: "What We Were Thinking". As usual the Super Bowl will offer a platform for a host of first time advertisers as well as all those seasoned pros like auto companies and brewers. Many novice spots are a bit ropy but this one from Fallon Minneapolis for Quicken Loans is first-rate. A clever and complicated idea like this, with some cool effects and lots of different camera set-ups, will always win our hearts. Though we doubt very much that the process of getting a push-button mortgage is quite as easy as they make out...


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Background

Free to all users | see full profile for current activities: The Minneapolis-based agency was originally created out of an informal partnership between Martin/Williams executive Pat Fallon and Bozell & Jacobs creative director Thomas McElligott. After working out-of-hours on private projects since 1974, the pair decided to set up on their own in 1981 with three other partners, Nancy Rice, Fred Senn and Irv Fish. They launched as Fallon McElligott Rice, with the promise they would be "A new advertising agency for companies that would rather outsmart the competition than outspend them." Although art director Rice also got her name above the door, both she and McElligott subsequently left the company, which was renamed Fallon McElligott. (McElligott's name remained on the board for another 20 years. He initially went to Chiat-Day Mojo in 1988, before founding McElligott Wright Morrison White in 1990. He retired in 1992.)

The agency began with a collection of small, mostly local clients looking for national coverage. The Wall Street Journal was an important early win, as were Rolling Stone (its very successful "Perception/Reality" series depicting the magazine's typical readers) and Lee Jeans, although all three later moved on. In 1986, Pat Fallon succumbed to the temptation of getting bigger faster and sold out to New York-based parent shop Scali McCabe Sloves, then owned by Ogilvy & Mather. In the early 1990s, both SMS and Fallon McElligott ended up as part of WPP, following the latter's acquisition of Ogilvy. But the quality of Fallon's work was slipping. In 1992, the agency lost out on a series of pitches, and Pat Fallon decided to take stock of his situation. The following year, the company borrowed $14m to buy itself back from WPP, and bring on a new, more high-powered management and creative team. (Scali McCabe Sloves was also sold off by WPP, eventually becoming the US HQ for Lowe Group). 

The newly liberated Fallon McElligott went from strength to strength, with billings jumping from $154m in 1992 to $486m by 1997. An important step was the win of the BMW US account in 1995. The launch campaign for the US-made Z3 roadster won many plaudits, and paved the way for a series of further wins. Also in 1995, the company established a presence in New York. Fallon McElligott Berlin was originally a joint venture with creative director Andy Berlin, but Fallon and Berlin fell out two years later after the latter tried to increase his stake in the shop. (Berlin left to launch what was later Berlin Cameron United).

The win of the United Airlines account in 1996 was another key gain, Fallon's biggest ever new business win. What made it all the more satisfying was that Fallon was the black sheep on a pitch list that included incumbent Leo Burnett. By sheer coincidence Fallon also won two other pieces of business off Leo Burnett in the same year - part of the McDonalds account (later resigned), as well as another key account, Miller Lite, worth $130m. (The latter was later lost to Ogilvy & Mather in 1999). 

In 1998 the win of the $20m pan-European Lee Jeans account inspired the agency to open a London office, as a joint venture with a British management team. Unlike other US agencies who opened US offices that year (notably Wieden & Kennedy), Fallon UK had a great starting run, picking up a series of good accounts. Its success naturally inspired Fallon to think of a larger network, and in February 2000 the agency announced its acquisition by Publicis. This gave Fallon backing to establish satellite offices around the world, as well as access to Publicis-owned media operation Optimedia. No financial details of the deal were announced but industry speculation put the price at between $100m and $150m. Almost 20 years after the departure of Tom McElligott, the agency finally shortened its title from Fallon McElligott to Fallon Worldwide in May 2000.

The international network finally began to take shape in October 2001, when the agency said it would launch Sao Paulo, Singapore and Hong Kong outposts. The three agencies opened for business in January 2002 as joint ventures with local management, similar to the successful London office. That outpost received a huge boost towards the end of 2002 when it won the pan-European Sony Electronics account, out of Saatchi & Saatchi. Shortly afterwards, a Tokyo office was added to the portfolio.

In 2003 and 2004, the agency broke new ground and encouraged many imitators with the launch of a series of short artistic films on behalf of BMW, and followed up that success with a similar campaign for Amazon. Yet 2004 and 2005 were marked by the loss of creative directors Dave Lubars in Minneapolis and Ari Merkin in New York, and the subsequent departure of several key clients in the US, including BMW, Dyson and Sony. Stability began to return to Fallon's North American outpost in 2006 following the appointment of creative director Kerry Feuerman. However the loss of both United Airlines and Citigroup in 2007, as well as the failure to convert a pitch for Volvo, led to the departure of Feuerman as well.


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