Grey Group is the smallest of the "Big Four" advertising networks within WPP, but has enjoyed several years of strong performance since 2010. Its reputation for careful account management has earned the loyalty of several long-standing advertisers, not least Procter & Gamble and GlaxoSmithKline, both clients for the past 60 years, and Canon for almost 40. Despite the strength of such client relationships, Grey was traditionally better known for careful and methodical account management than for outstanding creativity. However, the agency has taken giant steps since the mid-2000s to improve the overall quality of its output, with its New York and London offices leading that charge. That has led to a string of significant account gains. Prior to its acquisition by WPP, the group had long been the subject of merger speculation. Although a small number of shares were traded publicly, Grey was to all intents and purposes a private company, controlled by patriarch Ed Meyer. Those years of speculation finally came to an end in 2004 when it was revealed that Meyer was prepared to consider a sale. The deal with WPP finally completed in March 2005.
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Adbrands Weekly Update 18th Oct 2018: Ads Of The Week: "Face/Off". You know how annoying it is when the latest version of your iPhone software or your favourite app downloads and it looks completely different from the one you were using before? Thailand's Grey outpost GreyNJ United applies that frustration to everyday life, to absurd effect, to prepare users for a new update to Kasikorn Bank's widely used mobile app K+. How would you feel if the same thing happened to your girlfriend? Don't worry. This new version is certainly a lot more powerful than the one before, but she still loves you all the same.
Adbrands Weekly Update 16th Aug 2018: In the latest shake-up of Revlon's global marketing, Grey has been replaced as the beauty group's global creative agency by an inhouse entity, named The Red House. Grey told AdAge, "our contract ran through June, and we both chose not to renew." Earlier this year, Revlon - and what is now its subsidiary company Elizabeth Arden - shifted media out of Grey's sister agency Mediacom and into Initiative.
Adbrands Social Media 10th Aug 2018: FRIDAY CLASSIC: E*Trade "Babies" by Grey NY (2008). The "E*Trade baby" became one of the iconic marketing campaigns of the late 2000s. First unveiled in January 2008 during the Super Bowl, it carried E*Trade through the global financial crisis that erupted a few months later and then beyond into what would turn out to be a extraordinary seven-year run. Here's the original spot from 2008 - known as 'Whoa!' - and 'Wings', a sequel from the following year, post-credit crunch. ...[Story continues here]..
Adbrands Weekly Update 9th Aug 2018: Agencies continue to deny any serious new business threat from from consultancies such as Accenture and Deloitte. Yet at the same time they are covering all bases by launching their own management consultancy offerings. Grey is the latest to join the fray with the launch of Grey Consulting, which brings together a team of around 150 consultants globally. The unit will be run by Leo Rayman, previously CEO of Grey London. "Our practice will go beyond traditional consulting," said Grey global CEO Michael Houston. "We will combine analytical rigour with lateral creative thinking and an understanding of how to make things happen to accelerate growth for clients."
Adbrands Weekly Update 21st Jun 2018: Cannes Lions 2018. The first batch of winners were announced from Cannes Lions 2018. (See the full run-down, including all the Gold, Silver and Bronze winners at the Cannes Lions 2018 website). Grey Sao Paulo was awarded the Grand Prix in Mobile for its Corruption Detector app, on behalf of consumer protection watchdog ReclameAQUI. The free app is underpinned by a massive database compiling all official records of political corruption in Brazil, previously hidden away in the official records of hundreds of local courts across the country. With a general election coming up later this year, users can identify which local officials have been accused of corruption, simply by pointing their phones at a picture of the candidate. Using facial recognition technology, the app summons up their legal records to identify any associated corruption charges.
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Free to all users | see full profile for current activities: The Grey advertising business was originally founded in August 1917 by 18 year-old college graduate Larry Valenstein. During his vacations, Valenstein had worked as an errand boy for a small-time advertising agency, and now felt like trying his hand at the business himself. Funded by a $100 loan from his mother, he rented a tiny office at 309 Fifth Avenue in New York. Stuck for a name, he named the company after the colour of the walls in the office - he thought his own name too hard to pronounce and remember - and began touting his services to the shops and suppliers in the neighbourhood as Grey Art Studios.
Initially, Grey specialised in the production of a twice-yearly direct mail brochure containing ads sold to local businesses, mostly in the garment trade. Gradually he began to expand the business, moving to new offices on East 29th Street in around 1921, and taking on two staff: an art director and an office boy. Ironically it was the latter, 17 year-old Arthur Fatt, who was to make the most significant contribution to the company. Fatt quickly began suggesting ideas to his boss. In particular, he proposed increasing the frequency of the mailer and turning it into a slick magazine under a new name, Furs & Fashions. The content was expanded to offer a merchandising guide to local department stores. This proved extremely successful, and Fatt was quickly promoted to head salesman. The company name was altered to Grey Advertising in 1925, and a year later it booked its first national advertisement for an existing client, Mendoza Beaver Furs, in the August 1926 issue of Ladies Home Journal. Mendoza soon gave Valenstein a new lesson in business – the ad was never paid for.
The company developed steadily through the 1930s, picking up other garment trade and retail clients including Van Heusen and Dan River. Valenstein promoted office boy Arthur Fatt to full partner in the 1930s, and the two men oversaw the running of the company for the next 40 years. Billings topped $28m by the 1950s, but despite attracting its first packaged goods client, Mennen, in the mid-1940s, Grey was still largely regarded as a soft goods specialist with a particular niche in the retail trade. One major factor was that Grey was one of comparatively few advertising agencies owned and run by Jews at a time when, even in New York, the mainstream business world was still largely gentile. (Gradually, however, those old prejudices began to change after World War II and other supposedly "Jewish" agencies began to spring up in the 1950s. In fact, one of these was to establish itself as arguably the most influential advertising agency of the decade, Doyle Dane Bernbach, founded by former Grey employee Bill Bernbach.)
In the early 1950s Valenstein and Fatt appointed former newspaper salesman Herbert Strauss as general manager, with a brief to move the agency into the packaged goods sector. His first success was to capture the business of the Block Drug Company in 1955. A year later he was able to pull in Grey's first piece of Procter & Gamble business, for Lilt home permanents. More importantly he recruited a team of eager young turks from another P&G agency, The Biow Company, after its founder retired. (In 1953, Biow testified that he had paid a California lobbyist $90,000 to help him win the Schenley account. In just three years, Biow’s billings dropped by 50%). Among these recruits was young account manager Ed Meyer, who led the P&G account. Meyer had impressed the detergent giant by suggesting it retarget its struggling Ivory Flakes soap brand for baby clothes and diapers. The refocus was a big success, and P&G began feeding Grey ever larger pieces of business. Another coup for the agency was to build Kool-Aid from a minor powdered drink into America's #3 soft drink by the 1970s.
In the meantime, Grey also set about building a network. The first office outside the US was established in Canada in 1959. This was followed by London in 1962, followed by Grey Daiko in Japan the following year, a joint venture with local agency Daiko Advertising. As such, Grey was one of the first US agencies to make inroads in Japan, even before it had established a national presence within its home market. In the US, an office was opened in Los Angeles in the mid-1950s, followed by San Francisco and Detroit in 1966, a year after the company went public. A Chicago office was established in 1970 as a result of the acquisition of local agency North Advertising. That same year, Ed Meyer became CEO of Grey Advertising, acquiring a controlling stake in the business. Larry Valenstein left the firm the same year and died in 1982; Fatt left in 1976, and passed away in 1999. Meyer controlled the development of the company almost single-handedly for the next 35 years.
Over that period, Grey continued to evolve and expand its offering. It launched below-the-line division Grey Direct in 1979, followed by PR arm GCI four years later. In 1986, the group acquired Gross Townsend Frank Hoffman healthcare agency, which became the core of Grey Healthcare. Acquisitions in 1999 included Innovative Customer Solutions, a healthcare contract sales and consulting organization, which joined the Grey Healthcare Group; and a clutch of US PR agencies including Boxenbaum Grates, Kamer-Singer, and Dragonette, all of which joined the GCI Group. In early 2002 the group snapped up Atlanta-based US integrated agency 360, a partner on the BellSouth account.
Yet in all other respects, the generally conservative group took almost no part in the rush to consolidate that characterized the industry from the mid-1980s onwards. The group's financial performance dipped dramatically in 2001 as a result of a reduction in client spending as well as write-offs of several internet investments, but improved the following year as the agency won a strong portfolio of new business. In 2002 the group was reluctantly involved in an embarrassing lawsuit when it transpired that a supplier, New York print services company Color Wheel, had bribed Grey employees to win contracts and potentially defraud both Grey and several clients.
In June 2004, with the group showing clear signs of emerging from the advertising recession, news broke that Ed Meyer, still chairman & CEO, but by now aged in his 70s, was considering a sale of the business. Industry commentators initially considered Publicis to be the most likely buyer as a result of a personal friendship between Meyer and Publicis boss Maurice Levy, as well as the fact that the two groups shared a major client in Procter & Gamble. Ironically, the shared P&G account proved to be more of an obstacle than an asset to such a deal. Changing years of habit, P&G was said to have voiced concerns about pooling all its brands within a single marketing organisation.
This apparently left the way open for WPP, despite the British group's association with P&G's traditional rival, Unilever. Later Havas confirmed that it too had entered a bid, despite opposition from several of its own shareholders. Buyout firm Hellman & Friedman, previously a backer to both Y&R and Digitas, was also reported to have submitted an offer. However WPP was named as the winning bidder for Grey in September 2004. By the time the deal completed in March 2005, the WPP offer was worth around $1.7bn in cash and WPP shares. As Grey's largest shareholder, Ed Meyer received $473m in cash, shares and bonuses. Ed Meyer finally retired as chairman & CEO of Grey Global Group on January 1st 2007, just days short of his 80th birthday. Jim Heekin, who had been CEO of the Grey Worldwide network since August 2005, became group chairman & CEO.
For 2003, its last full year as an independent company, Grey Group reported revenues up 9% at $1.3bn, and said business continued to be difficult in Europe, and especially in Scandinavia. However the tough trading environment in North America appeared to have improved. That region accounted for almost 45% of revenues. This was only slightly ahead of the contribution from the EMEA region, although the latter was affected by very poor performance in Scandinavia, where the group reported substantial operating losses. Asia and Latin America between them contribute almost 11% of revenues. After a $24.4m loss in 2001, net income was back in the black in 2002, but jumped almost 60% in 2003 to $29.1m. The group's last reported accounts were for the first half of 2004, in which revenues rose more than 14% to $708m, and net income jumped by three-quarters to $17m. Procter & Gamble is by far the group's biggest client, accounting for 10.6% of revenues, or around $14m, in 2003. No other client contributed more than 5%. No audited financials are available for Grey since it became a WPP subsidiary. See full profile for current activities
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