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Louis Hagopian: Heads NW Ayer Ad Agency

September 3, 1985

NEW YORK (AP) _ Louis T. Hagopian, who heads one of the nation’s oldest advertising agencies as well as one of the industry’s trade groups, says his profession deserves more respect from the businesses it serves.

Advertisers treat their law and accounting firms as professionals, Hagopian says, even though their jobs are mainly to keep businesses out of trouble.

″When you hire an ad agency, you hope to sell more of something,″ he said in a recent interview. ″It’s a positive force on the bottom line.″

And as such, he argues that advertising agencies deserve the professional stature that legal and accounting firms are given in America’s boardrooms.

Hagopian, chairman and chief executive of NW Ayer Inc., said he plans to use his year as chairman of the American Association of Advertising Agencies to sell that idea to the business community.

Selling is something the 59-year-old Hagopian has been doing nearly all of his adult life.

Born and raised in Michigan, he went into the car business after completing a two-year stint in the Navy and graduating from Michigan State University.

He started in sales for General Motors Corp. in 1947, and six years later moved to Chrysler Corp.’s advertising department. He joined Ayer in 1960, and recently celebrated his 25th year with the company.

The early training at General Motors gave him a feel for the auto business. He went through a six-week training program in which he was taught how to assemble an automobile transmission and then was sent to the Pittsburgh office, where he handled customer and dealer complaints. ″It was a lowly clerical job, but you were right at the guts of the business,″ he said.

He moved to GM’s Kansas City office, where he taught others what he had learned and later became a district sales manager, the link between dealers and the auto factory.

″I wouldn’t trade that experience for anything,″ Hagopian said as leaned back and took in the view of Central Park afforded by his mid-Manhattan office. ″It has helped me in being CEO of this place.″

But Hagopian wanted to work in advertising rather than sales and he moved in 1953 to Chrysler, where got that chance first with the Dodge division and later with Plymouth.

At Dodge, he was involved in selecting the television shows that the division would sponsor. In those days, advertisers bought time from the networks and then bought the programming to fill it.

Musicmaker Lawrence Welk was enjoying some popularity in Southern California on a show sponsored locally by Dodge dealers, and Hagopian recalls someone suggested putting Welk on nationally.

Hagopian, who describes himself as ″a young Turk out of the Big Band era,″ disliked Welk’s musical style and opposed the selection. But his colleagues prevailed and Welk was televised nationally.

To Hagopian’s chagrin, the show did very well. It was only years later, he said, that audience demographic studies showed the people watching the Welk show ″had already bought their last Dodge.″

But the experience taught him two things. ″I learned my taste was not that of all of America, and I would have to put my own tastes aside,″ he said. ″It also taught me not to make a snap judgment without getting all of the information.″

The transition from Chrylser’s Plymouth division to Ayer in 1960 was quite smooth, Hagopian said. ″I left the Plymouth division on Friday and on Monday was management supervisor on their account at Ayer,″ he said.

He moved up in Ayer on the financial rather than the creative side of the business. The firm, which was founded in 1869 and calls itself America’s oldest advertising agency, made him its sixth chief executive in 1976.

The biggest problem facing the ad industry, Hagopian said, is ″the relative lack of stability in its relationship with its clients.″

″Accounts change hands far more than they should, and it is the fault of both clients and agencies,″ he said.

He said agencies that fail to meet performance standards such as for market share or product awareness may deserve to be fired. But he said agencies are too often ″indiscriminately fired″ because of a client’s impatience or desire to appear to have done something.

He said the ″better″ advertisers generally have ″long and stable relationships with their agencies,″ ticking off several examples from the 10 biggest advertisers - Procter & Gamble, Sears Roebuck, GM and Ford.

His own firm was recently fired after seven years on the Seven-Up account for Philip Morris Inc. Hagopian declined to discuss what he felt were the reasons for the switch.

Ayer had created the no-caffeine marketing campaign for Seven-Up, and the company credited Ayer as it made the change with ″substantially improving the volume of the company’s brands leading to record increases″ in each of the past three years.

″Given what we’ve done for Seven-Up, that’s a difficult decision to understand,″ Hagopian said in a memo to Ayer employees.

In addition to selling a more stable and professional relationship between advertisers and their agencies, Hagopian said he hopes to persuade business schools to include a course in advertising in their curriculum requirements.

″I was in business administration and had to take courses in business law and accounting even though I had no intention of becoming a lawyer or an accountant,″ he said. ″A one-semester survey course in advertising would help so when we deal with them they would at least understand the terms.″

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