ON A SUNNY THURSDAY MORNING LAST OCTOBER, a twelve-person team from GSD&M—Austin’s hot homegrown ad agency—boarded a chartered plane at Robert Mueller Municipal Airport. They were headed for Irvine, California, on a quest for the advertising industry’s Holy Grail: a major car-brand account.
The client was Mazda’s North American operations. Never mind that the $240 million account would increase GSD&M’s billings, which were $513 million in 1997, by roughly half. Winning the closely watched Mazda review would serve notice on Madison Avenue that the 26-year-old agency had spread its wings beyond regional clients like Southwest Airlines and the Texas lottery and had arrived big-time on the national scene. “When you land a major car-brand account, it puts you on a different level of perception,” says Roy M. Spence, a co-founder of GSD&M and its president. Indeed, an automaker’s brand account is a badge of prestige in the ad world. “An automobile and an airline—those are the big ones,” says Steve Krajewski, Adweek magazine’s Southwest bureau chief. “ GSD&M has its airline. Now it needs an automobile.”
Car accounts don’t come up for review every day—just seven times since 1990. So when Mazda’s agency of 27 years, Foote, Cone, and Belding, resigned the account last summer because of a conflict (its parent company, True North Communications, acquired the Chrysler Corporation’s ad agency), GSD&M did all it could to capture the business—including turning its Austin headquarters into a pseudo-showroom. There were sleek black Mazdas, complete with vanity plates that read gr8 ads, parked in the lobby, and there were three more in the parking lot for employees to test-drive for inspiration. Only once before had the agency come close to landing a car account: in 1995, when it made it to the semifinals of a $90 million Volkswagen review.
This time around, GSD&M—which was ranked sixty-eighth in gross income among the nation’s ad agencies in 1996—was one of three finalists. The others were the Los Angeles office of Ogilvy and Mather (the creator of American Express’ “Don’t Leave Home Without It” campaign), a division of Ogilvy and Mather Worldwide, which was ranked tenth; and W. B. Doner and Company, of Baltimore and Southfield, Michigan, which was ranked forty-fourth. (A fourth agency, Deutsch of New York, withdrew from the finals in mid-September, citing pressing business for other clients.)
The speculation was that Ogilvy and Mather would win the coveted account because it already handled European assignments for the Ford Motor Company, which owns a 34 percent interest in Mazda. Doner also had a relationship with Ford: It had previously created campaigns for more than seven hundred Ford dealers across the country. But some advertising industry observers were betting that Mazda’s new chief executive of North American operations, Richard N. Beattie, was a risk taker who would choose an agency not so closely associated with Ford.
A surprise win over Ogilvy and Doner wouldn’t have been the first time GSD&M scored an upset over better-positioned rivals. In 1989 the agency raised eyebrows in New York when it was chosen by the Wall Street Journal to handle its hundredth-anniversary campaign. And in June 1995 GSD&M landed MasterCard International’s $80 million—plus media-buying account, much to the chagrin of Madison Avenue. “It was the largest single media account ever to leave New York,” Spence brags. “New York just went batshit.” Such successes have helped GSD&M solidify its standing in Texas, where it ranks second in billings (behind Temerlin McClain of Irving) and fourth in revenues (behind Temerlin McClain, DDB Needham Dallas, and the Richards Group of Dallas). “They’re a complete enigma in the advertising world: a half-a-billion-dollar agency sitting in Austin, Texas,” says Adweek’s Krajewski. “They’re saying geography is irrelevant.”
What makes it irrelevant is the quality of GSD&M’s ads. Some of the agency’s most memorable campaigns have featured the superhero Scratchman, a spokesman for the Texas lottery; a jet painted to resemble Shamu, a joint promotion for Southwest Airlines and Sea World; and the Texas Department of Transportation’s anti-litter slogan “Don’t Mess With Texas.” Yet paradoxically, this is one ad agency that denies it’s in the ad business. Its product, Spence says, is “visionary” ideas. “The marketplace is ad rich and idea poor,” he laments. “What the ads lack in relevance they make up for in volume.” To counteract that reality, GSD&M practices a philosophy of “values-based branding,” a concept that builds on legendary adman David Ogilvy’s theory of “brand personality.” Ogilvy preached the association of a company or product with consistent, appealing images “rather than any trivial product difference.” GSD&M goes further to link a brand with a value that is relevant to consumers. So Southwest Airlines isn’t in the airline business but, rather, the freedom business. And Doubletree Hotels doesn’t rent hotel rooms—it sells peace of mind.
The architect of that philosophy is 49-year-old Spence, a Jeff Bridges look-alike praised by Adweek as GSD&M’s “greatest asset” and “resident preacher” when the magazine named it Southwest Agency of the Year for 1996. Indeed, the likable firebrand delivers impassioned weekly sermons to his staff of 350 from a custom-built pulpit perched halfway up the lobby stairway of Idea City, GSD&M’s new $7 million headquarters. A native of Brownwood—where, as quarterback, he led his high school team to the state championship—Spence is also a player in the world of Democratic party politics. He has worked on behalf of Texans like U.S. Senate candidate Bob Krueger and Governor Ann Richards, but his closest ties are to Bill Clinton, whose 1992 presidential campaign he advised. The walls of his office, in fact, are covered with mementos of their long friendship: There’s a photo of Spence with the Clintons at a surprise birthday party for Hillary and another of the first lady jogging in a GSD&M T-shirt, plus a framed handwritten note from Bill and an autographed copy of his 1993 State of the Union address.
Spence is the S in GSD&M. The G, D, and M were his friends and fellow students in the University of Texas at