Foote Cone tops local ad agency ranking.

Foote Cone tops local ad agency ranking

The recession hit many Los Angeles County advertising firms hard in late 1990, according to this week's List, but no one harder than keye/donna/pearlstein, which went out of business.

The demise of keye/donna/pearlstein aside, perhaps the most dramatic shift in the pecking order of the county's advertising agencies was the fall of the giant - J. Walter Thompson - from fifth to 15th, on the Business Journal's List of the county's 50 largest agencies, based on annual capitalized local billings.

J. Walter Thompson's billings fell from an estimated $228 million in Los Angeles County in 1989 to $119 million in 1990. Along with major accounts, the agency has lost about half its employees to layoffs.

But Executive Vice President Bill Lane said his agency has purposely trimmed its client list to rid itself of clients who didn't pay their bills.

"The losses we have incurred over the past year were an intentional effort to get our house in order," he said. "We do our business better. We were doing some bad business. (Now) we don't get ourselves into bad payment situations. It's self-imposed discipline."

More recently, J. Walter Thompson lost its Vons Supermarket account. "The Vons loss was not a good one," Lane admitted, but he said he's not worried and expects his agency to come back strong in Los Angeles in 1991.

"The first thing we're going to do is go get another grocery store account," said Lane, although he wouldn't specify which account he is after. "We're all victims of the times and the economic pressures. These things are cyclical, and we happen to be in the down part of the cycle. We need to remember to keep things in perspective."

Meanwhile, the two top agencies in Los Angeles County - Foote Cone & Belding and Chiat/Day/Mojo - maintained solid billings and continued their tight battle for first place on The List.

Based on reported 1990 capitalized advertising billing, FCB Los Angeles replaced Chiat/Day as the No. 1 local agency, with $400 million in billings, compared to $384 million at its competitor's Venice office.

Chiat/Day's billings showed a drop from its 1989 figure of $425 million, but Director of Finance Operations Angela Sumser said the 1989 figure included billings from a design firm that Chiat/Day owned and has since sold, and included public relations billings, which the Business Journal has decided not to include in compiling its rankings.

Chiat/Day Chairman Bob Wolf said pure advertising billings were up at his agency's Venice office in 1990.

"I know it hasn't slipped. It's gone up. We had an excellent year in terms of new business," said Wolf. "I think that in 1991, the first half of the year was kind of tough. There was some cautious belt-tightening. We're cautiously optimistic."

Joan Lufrano in FCB's Chicago office said FCB Los Angeles' numbers, the same estimates FCB supplied to Adweek magazine, include billings from FCB's Orange County office. She could not provide separate figures for Los Angeles County alone, and FCB's top local executive, Steve Hayman, could not be reached for comment.

A new addition to the list was the Marina del Rey office of Boston-based Hill Holliday, ranked 19th with estimated billings of $95 million.

Hill Holliday opened its Los Angeles area office in 1988 to handle the advertising for Nissan Motor Corp.'s Infiniti car account. The advertising campaign began in August 1989, and the car went on sale in November 1989, so the estimated 1990 billings of $95 million include the first full year of the campaign.

Hill Holliday Los Angeles handles a few accounts other than Infiniti, but the car campaign accounts for the bulk of its billings.

"This office is dominated by one account," said Jack Sansolo, president of the local office. The early Infiniti commercials were unusual, in that they did not show the car or even explain they were advertisements for a car in their early months. There were rumors last year that the client was unhappy with the campaign, but Sansolo said his company's relationship with Nissan has gotten "progressively better and better."

"Our objective is not to be the biggest. Our objective is do better and better work," said Sansolo. "If we stay the same (in size), I'll be quite happy."

PHOTO : Stephen Hayman: Foote Cone & Belding's top Los Angeles executive