More than Less
By Michelle Halpern
Teehan+Lax, Toronto
There are 15 people at Teehan+Lax’s office in Toronto today, and Jon Lax is worried it’s already getting out of hand. “We don’t want to be huge,” he says. “We’re run by creative people. We don’t have office managers and account executives, and we don’t want to grow to the point where we need them.
A tight ship: Teehan+Lax partners (l-r) David Barclay, Geoff Teehan, Jon Lax and Dave Stubbs
“The work suffers if you get larger,” he adds. “And we promise our clients that at least one partner will be working on their business.” Those partners are Lax, David Barclay, Geoff Teehan and Dave Stubbs, who recently left the Toronto office of Organic to join the T+L team.
Stubbs wasn’t the only one. Three other Organic staffers made the move earlier this fall, although Lax insists it was just a coincidence. “We interviewed a lot of people for this. It just happened that the people we liked all came from Organic.” Of course, he admits, there’s an advantage to hiring a team that already has chemistry. But T+L recruited Stubbs and the rest for a much bigger reason.
Until a few years ago, the shop focused solely on interface design. No programming, no online advertising. “Most of our existing staff want to do user experience design. They’re looking at new interfaces, usability and site structure, not banners,” Lax says. “So we thought we could either invest in getting better at programs-what we call online advertising-or just become uncompetitive and lose that side of the business.” The answer Lax chose was to invest and find people to build that practice who can “come up with the next Subservient Chicken.”
T+L may not yet be able to claim a campaign as trend-setting as the Crispin Porter + Bogusky work for Burger King, but it’s on a roll-winning three Digital Marketing Awards this year and one in 2005. Last year it picked up gold for a rich media banner ad for Dymo Labelwriter and this year it struck Gold again for Telus’ Mike network website.
In addition to Telus, the agency’s Canadian clients include President’s Choice, BMO and Driving.ca. South of the border, it handles John Hancock Mutual Funds in Boston, JP Morgan in Ohio and Sony, as well as a few American ad agencies that count on the shop’s design expertise from time to time. That means a lot of travelling, and less of that elusive free time.
Lax and his team became well-aware of the spare time challenge recently. The agency set out to create a Web 2.0-style shopping site called Paruba.com. Lax and Teehan pulled three full-time staffers off client accounts to work on the project, and the site was showcased at DemoCamp this summer, an event in which industry insiders gather to try out one another’s beta products. The response was good, but there just wasn’t enough time to juggle client work and entrepreneurial ventures. “We decided early on we want to have a life outside work,” Lax says. “We’d rather make a little less money and be a lot happier.”
Nonetheless, Teehan and Lax are both well-known in industry circles, and Lax is a frequent contributor to One Degree, a Canadian online digital marketing community. “I still think we can conquer the world,” he says. “I just don’t think we need 150 people to do it.”
From direct to digital
By Michelle Halpern
Proximity Interactive, Toronto
When interactive was blooming, digital pure-plays gained the trust of major marketers by specializing in services most large agencies couldn’t offer. The big shops didn’t care much, since digital spending was still somewhat of a joke.
Livin’ Large: Proximity built the Sobelivin.ca program promoting Sobe teas, fruit beverages and energy drinks. Website traffic exceeded forecasts by 15% in the first three months
How the times have changed. As big marketers have poured an ever increasing amount of their budgets into interactive, large agencies have realized they’d be silly to ignore their traditional clients’ interactive portfolios. One of those is BBDO’s Proximity Interactive, which had nothing short of a groundbreaking year in 2006.
Much is owed to Andrew Bailey, who joined Proximity (when it was known mainly as a direct shop) in January 2005 from FCB Interactive, where he was client service director. Under his leadership, Proximity Interactive tripled its revenue and profits from 2004 to 2005. By June 2006, revenues had already surpassed total revenue for all of 2005, and the agency is on track to more than double last year’s revenues. Bailey was recently promoted to senior vice-president, interactive, and his team grew from less than a handful two years ago to 26 today.
“In early days, it was believed that because digital was so different, it needed its own set of rules,” Bailey says. “We believe that couldn’t be further from the truth… Podcasts, blogs, RSS feeds will all come and go. What will never go away is tying digital channel activities to business results.”
Proximity has also seen a slew of new clients, ranging from traditional BBDO followers to independent wins. Pepsi-Cola Canada has long trusted BBDO for its ad work, but until recently, its small interactive projects were distributed among several smaller digital shops. Proximity has held the 7Up and Sobe accounts for years, and added Pepsi and Mountain Dew to its portfolio this year. The Pepsiaccess.ca site saw 500,000 visitors in its first 10 weeks, and Sobelivin.ca exceeded traffic forecasts by 15% in its first three months. Proximity also picked up the pro bono account for Unicef, another long-time BBDO client.
Other new clients include CBC.ca, RBC, Sears.ca, Parmalat, Porter Airlines, Service Ontario and the Effem pet care portfolio (Pedigree, Cesar and Whiskas). Retained clients include Niagara Fallsview Casino Resort, Casino Niagara, Frito-Lay Canada, Alliance Atlantis, Mitsubishi Motors, Shaw, the Ontario Ministry of Economic Development and Trade, and Campbell’s.
Proximity Interactive divides its team into five groups: account service, creative, production, development and quality assurance. “We are one of the few shops that make the distinction between client service and project management,” says Bailey. “We believe client service folks should focus on strategy, client relationships and servicing the business. Producers (or project managers) should focus on scope of work, timelines, estimates and resource allocation.”
And, he admits, being part of a big network is certainly a bonus. “It’s a big world. We have the most awarded network internationally-we leverage it.” Up next, Proximity Interactive takes on Montreal, with a division opening there later this fall.
The business buyer
By Norma Ramage
Rare Method, Calgary
Roger Jewett prefers the term interactive rather than digital for his Calgary-based agency, Rare Method. “It doesn’t matter where you advertise but how you advertise. We provide any kind of marketing services required to create an interactive relationship with a customer,” including not only website and online services, but event marketing, print design, animation and traditional mass media advertising.
Rare Method’s path to that eclectic list of services was a unique one that started in 2000 when entrepreneur Jewett (pictured) founded the company as an investment instrument to acquire media firms. Within a year, it bought an on-hold messaging company and a small, local web design group.
Since then it has added companies at a dizzying rate-two to three a year, increasing the agency’s staff to over 80 and giving it gross revenues of $7.2 million in 2006. While Rare Method does primarily online work for Bayer Crop Science, TransAlta Utilities, Unity Builders Group and CSI Wireless, it handles event marketing for Ford Motor Company of Canada, recruitment advertising for CP Rail and has created an animated online game for Voice Pictures.
Jewett’s goal in snapping up businesses is to create an interactive marketing company that provides both traditional and digital services. His most recent acquisition came last month with the takeover of Calgary-based website development company Ground Level Design, which works in the oil and gas, and building and land development sectors. Last March, Rare Method bought See Your Game Alberta Ltd., an interactive event marketing services company, and acquired Utah-based Dental Success last December.
It’s that latter buyout that hints at another Jewett goal: U.S. expansion. While Jewett admits it’s taking longer than he hoped, the agency’s U.S. sales increased in 2006 with the addition of clients like Alabama-based software company Avocent and CDOC, a Virginia distributor of racing car equipment. The result: Rare Method’s U.S. revenues now account for 14% of its business, compared with 6% in 2005. Next up, Jewett plans to open a one-person office in Phoenix to promote the agency’s event marketing services.
Despite its rapid expansion, the agency has kept long-term clients like Travel Alberta, Moxie’s Restaurants and Shell Canada. Don Boynton, communications director for Travel Alberta, Rare Method’s biggest client, says Travel Alberta has expanded its three-year relationship because the agency is “adept” at giving his organization the targeted niche market websites it needs. “They are a smart, creative, buttoned-down agency.”
While defining its future strategies, Rare Method has also maintained its present-day growth rate, building on a 47% increase in gross revenues from 2004 to 2005 with a 35% increase this year, resulting in its selection by Alberta Venture business magazine as the province’s fifth fastest growing business.
