D’Arcy Masius Benton & Bowles, Inc.

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D’Arcy Masius Benton & Bowles, Inc.

1675 Broadway
New York, New York 10019-5809
U.S.A.
(212) 468-3622
Fax: (212) 468-3082

Private Company
Incorporated: 1906 as D’Arcy Advertising; 1929 as Benton & Bowles
Employees: 6,000 Sales: $4.5 billion

D’Arcy Masius Benton & Bowles (DMB&B) is the world’s second largest privately held advertising and communications company. It was formed by the merger of two pioneering firms in the advertising industry: D’Arcy MacManus Masius, an agency based in the Midwest, and Benton & Bowles, a pillar of the New York advertising business. With diversified worldwide operations, DMB&B serves a roster of prestigious clients.

The agency that would become DMB&B got its start on August 23, 1906, when William C. D’Arcy opened a six-person advertising firm in St. Louis. After graduating from a St. Louis public high school, D’Arcy took a job selling paint. Ten years later, he moved to the Western Advertising Company, a pioneering St. Louis firm, where he stayed for five years to learn the advertising business. D’Arcy struck out on his own when he saw an opportunity to prosper by promoting a fizzy brown beverage with a two-part name, Coca-Cola.

Coke’s ad budget in D’Arcy’s first year was only $3,000. D’Arcy had a small stable of other clients that year, including Plover Hams and Bacon, Cascade Whiskey, and Nature’s Remedy, an elixir that claimed healing properties. The company earned $1,500 by the end of 1906.

The survival of D’Arcy’s fledgling enterprise was guaranteed when Coke upped its ad budget to $25,000 in the firm’s second year. Instantly, D’Arcy became an advertising agency with a national presence, placing ads for Coke in publications across the country. This track record helped D’Arcy win its next major account, St. Louis brewer Anheuser-Busch, Inc., in 1914. Anheuser-Busch put the agency to work promoting its products Bevo, a nonalcoholic soft drink, and Malt Nutrine, a premium bottled tonic.

The following year, D’Arcy landed Anheuser-Busch’s Budweiser account. Technological innovations led to the use of refrigerated railroad cars and the development of a stabilized brewing formula—two factors that enabled Anheuser-Busch to sell Budweiser across the United States. The brewer therefore needed an advertising agency that could promote its product throughout the country. And D’Arcy notched another major account in 1916, when the General Tire company signed on. The following year, D’Arcy began its marketing research efforts, conducting its first interviews with consumers to determine their attitudes toward various products.

The advent of World War I slowed the American economy, and clients reduced their advertising budgets. D’Arcy, however, survived the war without losing any accounts, despite the fact that wartime prohibition cut into the company’s Anheuser-Busch business. By 1919 the ad agency had grown to 30 employees.

In 1920, however, D’Arcy’s key Anheuser-Busch account received another crushing blow when the 18th Amendment to the Constitution inaugurated Prohibition, a nationwide peacetime ban on the manufacture, transportation, and sale of alcoholic beverages. The brewer stepped up marketing of its nonalcoholic beverage, Bevo, and turned to sales of other related products, like yeast, to stay in business.

That same year, D’Arcy set up its research center, which began with the clipping and saving of advertisements from both current major publications and more than 30 years of backfiles. This resource allowed D’Arcy staff to trace the history of various advertising campaigns created for a given product over the course of decades, thereby aiding them in creating their own new advertising.

In 1923 D’Arcy opened its first office outside St. Louis. The Atlanta location served as a liaison with the flourishing Coca-Cola company. Throughout the 1920s D’Arcy introduced several innovations in the production of print ads and began advertising on a new medium: radio. The first ads to be aired were for Anheuser-Busch on KMOX in St. Louis.

By 1929 D’Arcy’s account with General Tire had grown large enough to merit the opening of a special office, and the company’s operations expanded to Cleveland for this purpose. During this time, the company also conducted its first major effort at market research, surveying 733 airports to determine demand for Shell aviation fuel.

Two years later, D’Arcy began a decade of landmark work for Coca-Cola with a Christmas campaign that included an enduring depiction of Santa Claus. The artwork from this ad, showing Santa with twinkling eyes and a red fur-lined suit, would go on to shape the popular perception of this mythical figure. In addition to the Santa campaign, which ran every winter in an effort to get people to drink Coke even when it was cold out, D’Arcy introduced the Coke slogan, “The Pause That Refreshes,” in the 1930s.

As Americans took to the highways, D’Arcy helped Coke develop filling station vending machines and also plastered the land with billboards. The agency would soon become the largest buyer of outdoor advertising space in America, pioneering the use of rotating cutouts to further attract attention to its ads.

With the repeal of Prohibition in 1933, D’Arcy’s other major account came back to life, heralded by a print ad in every newspaper in the country that proclaimed, “Some thing More than Beer Is Back,” touting the economic and social advantages of legalized liquor.

Building on its successes with national accounts, D’Arcy undertook a geographical expansion in the 1930s. The company opened a New York office in 1934, a Toronto outpost in 1938, and a Los Angeles branch in 1939. Despite the general economic malaise of the Great Depression, William D’Arcy’s enterprise prospered throughout the decade.

The company underwent a much more severe test with the American entry into World War II at the end of 1941. D’Arcy’s staff was reduced as its employees joined the military, and almost all of its clients cut back on their advertising budgets as the economy shifted to war materiel production, which severely restricted the manufacture of consumer goods. With the resulting shortages of many products, ads urging people to buy became inappropriate. Instead, D’Arcy and its clients devoted themselves to the promotion of the war effort with ads urging Americans to buy war bonds.

Despite the privations of the war years, D’Arcy expanded further in 1942, opening a wholly owned subsidiary in Mexico City, Publicidad D’Arcy. At the conclusion of the conflict in 1945, the agency underwent another transition when its founder, William D’Arcy, announced his retirement. At the time he stepped down, billings at the company D’Arcy had built topped $21 million.

D’Arcy was replaced at the helm by his deputy and longtime employee, J. F. Oberwinder. During his tenure, D’Arcy began to employ the new medium of television to promote its clients” products. Anheuser-Busch became the sponsor of the Ken Murray Show, aired over the CBS network on Saturday nights, and in 1955, Donald Woods became the on-air salesman for Budweiser, “The King of Beers.”

Coca-Cola got on the television bandwagon when it signed up to sponsor Kit Carson, a Saturday afternoon cowboy show for children. Four years after the agency’s 1951 transfer of Coca-Cola dealings to its New York office, D’Arcy suffered the loss of this flagship account: Coca-Cola switched its business to McCann-Erickson, New York, a competing advertising firm with an international presence.

In the wake of this loss, D’Arcy won several other big clients, including Standard Oil of Indiana, Royal Crown Cola, and car manufacturer Studebaker-Packard. In the mid-1950s the company also opened an office in Chicago. Along with its branches in Detroit, Houston, Dallas, and Havana, Cuba, this gave D’Arcy 12 offices across North America.

D’Arcy’s use of outdoor billboard advertising expanded greatly during the 1960s, and the company introduced a number of technological innovations to the field. Among D’Arcy’s most successful campaigns during this time was the launch of the red and blue Budweiser label as an advertising icon. The company first ran the label as a Life magazine ad in 1965. Soon, the demand for products bearing the label had taken off, and it was imprinted everywhere from beach towels to hot air balloons.

By 1966 D’Arcy was taking in $120 million a year, and the company acquired Johnson & Lewis, a San Francisco advertising agency. Revenues remained at that level for the following year but dropped to $110 million in 1968 and fell even further the next year to $102 million. One factor contributing to this slow-down was the account losses suffered by D’Arcy’s New York office, which lost its $10 million Royal Crown Cola account in 1969, as well as several other clients whose business totaled $6 million.

Difficulties continued in 1970, as the Chicago office lost its $7 million McDonald’s Corporation fast food account, and the company shuffled members of its top management in an effort to stem the tide of client defections and set profits on the rise. D’Arcy had scaled back its full service offices to eight, and its billing was sliding toward the $100 million level.

In late 1970 D’Arcy merged with McManus, John & Adams, Inc., an advertising agency headquartered in Detroit. Among the clients of this firm were General Motors and 3M. The plans to merge were disrupted initially by a suit brought by a disgruntled former D’Arcy executive, who charged that he had been fired improperly because he opposed the merger. After the suit was settled out of court, the two agencies combined their operations, consolidating offices in New York, Chicago, and Los Angeles and changing the agency name to D’Arcy-McManus.

The agency went through a series of additional modifications during the 1970s, beginning with a name change in April 1972 to D’Arcy-McManus International. Six months later, D’Arcy-McManus underwent another transformation, merging with a British advertising agency, Masius, Wynne-Williams. This company had been founded in London by an American in the aftermath of World War II, and it had extensive operations in Europe, South Africa, Australia, and New Zealand. The firm then adopted the name D’Arcy-McManus & Masius, or DM&M. In the following year, DM&M spun off its research arm as a subsidiary, called Media Information Research.

In the early 1970s DM&M began to systematize its marketing methods, developing theories to explain how consumers decided what products to buy. These methods would eventually become “Belief Dynamics,” which would lead to the use of target audiences to increase the effectiveness of advertising campaigns.

During the mid-1970s D’Arcy worked for a variety of clients in diverse businesses, including the automobile and restaurant industries and the U.S. Armed Forces. The agency created successful campaigns to encourage enrollment in the U.S. Air Force and also handled advertising for the General Mills Restaurant Group’s Red Lobster chain of seafood restaurants. In 1975 the company agreed to refrain from making deceptive claims of fuel economy in its ads for Cadillac’s Eldorado model, after it was charged with doing so by the Federal Trade Commission a year earlier. Around the same time, DM&M began producing advertising to promote a new kind of beer, “light” beer, for calorie-conscious consumers.

DM&M began a push to expand global operations in the late 1970s. The company added offices in Australia, Hong Kong, Kenya, South Africa, Germany, Spain, and Zimbabwe and by 1984 had 46 offices around the world. At that time, it again altered its name slightly, to D’Arcy McManus Masius, and instituted a new, more centralized corporate structure after it lost Colgate-Palmolive, a $35 million client. The company planned to compete more effectively for international accounts in its new incarnation and aimed to reach revenues of $2.1 billion by 1988.

D’Arcy McManus Masius took a large step toward that goal in 1986, when it merged with Benton & Bowles, a venerable New York advertising agency. Benton & Bowles had been founded in July 1929 by Chester Bowles and William Benton, who started out with a staff of five. With a stable of General Foods products, including Hellman’s mayonnaise, and Certo, a pectin extract for making jellies, the fledgling enterprise rode out the stock market crash of 1929 and the subsequent Depression to become a leading New York ad agency, retaining its affiliation with General Foods for more than five decades and adding such consumer giants as Procter & Gamble.

With the merger of the two privately held firms, then the largest in the advertising industry’s history, D’Arcy Masius Benton & Bowles became the world’s sixth largest advertising agency. Benton & Bowles brought to the union a portfolio of communications concerns that it had purchased over 15 years, including Medicus Intercon International, a medical communications company; Ted Colangelo & Associates, a corporate communications specialist; Manning, Selvage & Lee, a large public relations firm; and several others.

The merger was followed by staff cutbacks in October 1986, as DMB&B attempted to streamline its operations in response to a sluggish economy. The firm laid off 63 employees in New York and San Francisco, closed its Atlanta office, and began to shed its smaller regional bureaus, including those in Houston and Miami.

As DMB&B’s overseas revenues grew, the company’s American operations remained static. The agency became known on Madison Avenue as the “bridesmaid agency” for its failure to succeed in competitions for a number of big new clients. Responding to an industry perception that DMB&B lacked creative sparkle, the company undertook a reorganization, putting creative directors in closer contact with account supervisors.

The reconfigured agency’s push for new business finally bore fruit after three years, when in 1989 DMB&B snagged two big new clients: a $50 million Maxwell House coffee account from Kraft General Foods Group, and half of the $215 million Burger King fast food franchise job. It followed up these gains by augmenting its creative staff and paying record salaries to attract top executives in an effort to banish once and for all the idea that DMB&B was an unimaginative workplace. In November 1990, however, DMB&B lost the Maxwell House account and was forced to fire 70 employees at its New York office as a result of the drop in expected revenue.

In that same year, the company purchased a 49 percent interest in Sosa, Bromley, Aguilar & Associates, an advertising agency specializing in appeals to the Hispanic population, and further expanded its communications holdings when it bought the Donald E. Whiting Yellow Pages business. In addition, DMB&B undertook significant international advances, buying part of an advertising agency in Malaysia and forming joint ventures in India and Pakistan to augment its network of Southeast Asian operations. Agreements with agencies in Brazil, Argentina, and Colombia added to the company’s holdings in Latin America. It also acquired a British firm, Yellowhammer.

In a major move that signifies a dramatically changing marketplace, DMB&B opened an office in 1991 in Guangzhou, China, to advertise products for Procter & Gamble, Sharp and Philips. DMB&B’s Asia-Pacific network includes agencies in China, Japan, Hong Kong, Korea, Taiwan, the Philippines, Singapore, Australia (Sydney and Melbourne), and New Zealand.

Also in 1991 DMB&B opened agencies in Hungary and Czechoslovakia, building on the move it had made into the Eastern bloc in 1989, when it started DMB&B/Moscow, a joint venture with Promstroy Bank—the second-largest bank in what was then the Soviet Union. In 1992, a Warsaw office was opened.

In addition, DMB&B augmented its holdings in the Hispanic and ethnic marketing field, purchasing 49 percent interest in two California firms: Noble & Asociados, a major packaged goods advertising agency, and Moya, Villanueva & Associates, a leading Hispanic public relations company. These new companies, coupled with Sosa, Bromley, Aguilar & Associates, give DMB&B the strongest Hispanic-related communications capability in North America. The company also bought into a Puerto Rican advertising agency located in San Juan.

DMB&B is the largest U.S. agency in national broadcast agency of record (AOR) buying. The agency’s total value of AOR national broadcast buying assignments exceeds $1.3 billion. Clients in this important area of service are Procter & Gamble, Kraft General Foods, Grand Metropolitan, North American Philips, and Pet, Inc.

As of 1992, the company operated over 100 offices in 36 countries. With its broad geographical spread and its diversified operations in advertising, medical communications, promotional marketing, and public relations, DMB&B appeared equipped to hold its position among the leading advertising agencies worldwide.

Principal Subsidiaries

Clarion Marketing & Communications; DMB&B Yellow Pages; Intergroup Marketing & Promotions; Manning, Selvage & Lee, Inc.; Medicus Intercon International, Inc.; Sosa, Bromley, Aguilar & Associates.