Meet Labatt Brewing Co. Ltd.'s newest weapon in the beer wars: Eight young, well-paid guys who want to rewrite the advertising rule book in Canada.
Grip Ltd., their new, stripped-down ad agency, was officially launched in Toronto yesterday, almost two months to the day after Labatt fired its shop of eight years. Labatt had complained that Ammirati Puris wasn't providing good value because the traditional agency model was rife with inefficiencies.
Grip aims to address Labatt's concerns.
"This agency will deliver on its promise of world-class advertising for less," said Bob Shanks, a Grip partner who was formerly president of Roche Macaulay & Partners Advertising in Toronto.
Grip is 100 per cent owned by its employees, but it has Labatt's fingerprints all over it. Labatt provided the startup funding through its first contract with the agency, and one of Grip's partners and key architects is Mike Robitaille, who until Dec. 31 was Labatt's director of marketing.
"I think the [agency's]name should have been La-Boys," said Geoffrey Roche, creative director at Roche Macaulay, one of several agencies that lost high-profile talent to the startup. "Labatt has bankrolled the thing."
Labatt officials say the agency will be free to operate independently and attract other clients.
Grip says it will provide top-drawer advertising at lower cost, thanks to a streamlined structure that avoids the layers of administration in a traditional agency. As well, it is promising a "totally transparent operational philosophy," in which clients will have access to Grip's books and input into its strategic direction through an advisory board.
"There will be no wizard-behind-the-curtain policy in terms of what we share with our clients," Mr. Shanks said.
Moreover, Grip's charter prevents it from being sold, which means it won't become part of a multinational agency network, he said. Because it will not report to a head office in New York, theoretically the agency will not be under pressure to pump up profits by overcharging for work.
One area where Grip is not skimping is salaries.
Advertising sources say writers and art directors were lured with pay packets in the $300,000 range -- well above industry averages -- but Grip would not confirm this.
The creative teams are: Dave Chiavegato and Rich Pryce-Jones, both formerly of Palmer Jarvis DDB in Toronto; David Crichton, co-founder of Crichton Kim-Kirkland Co. in Toronto, and Graham Lee, former creative director at Odiorne Wilde Narraway & Partners in San Francisco; and Randy Stein, former creative director at Palmer Jarvis DDB in Vancouver, with Scott Dube, former senior vice-president and creative director at BBDO Toronto.
Labatt is eager to attract other clients to the agency, and recently sent letters to major advertisers, including Sears Canada Inc. and Unilever Canada Ltd. Charles Oliver, vice-president of marketing with Labatt, said there have been no takers so far, but "we're expecting to see other clients."
Labatt shouldn't hold its breath, industry insiders say. Clients will be reluctant to move to Grip because of concerns that their brands will not be given the same priority as giant Labatt, whose estimated $60-million ad budget makes it one of Canada's biggest advertisers.
Gary Prouk, a partner with Sebastian Consultancy in Toronto, said he wouldn't move his account there if he were a client. "It's a bunch of people pulled together to do beer advertising."
Grip is assuming responsibility for Labatt's flagship Blue and Blue Light brands, in addition to John Labatt Classic, Kokanee and Carlsberg.
Mr. Prouk and other industry observers speculate that Labatt will move its Budweiser brands to Grip from Palmer Jarvis DDB. That would make sense for Labatt, they say, because Mr. Chiavegato and Mr. Pryce-Jones created widely acclaimed ads for Bud Light while they were at Palmer Jarvis.