Corporate legal dramas often serve as a reminder to one of the new cardinal rules of business:
Watch what you say in email.
I suspect there are a few people at Apple and its ad agency TBWA\Chiat\Day who wish they could take their messages back, now that Samsung’s lawyers have introduced them as evidence.
One email from Phil Schiller to Tim Cook says that Apple “may need to start a search for a new agency … we are not getting what we need from [Chiat] and haven’t been for a while.”
Tim’s reply: “If we need to do this, we should get going.”
This all happened in 2013, so who knows if it’s blown over by now. But given Steve Jobs’ long-running relationship with Chiat, this potentially represents a huge break from the past.
A little perspective is in order.
A brief history
Steve started working with Chiat way back in the days of Apple’s first computer hit, the Apple II. Along with Chiat came the agency’s chief creative, Lee Clow — one of the most acclaimed creative directors in advertising history.
The relationship between Steve and Lee would become historic.
To launch Macintosh, Lee and his team created the legendary 1984 Super Bowl commercial. They also established the tone of voice that guides Apple to this day.
Chiat’s Macintosh work probably changed advertising as much as Macintosh changed computers. The 1984 spot alone is considered by many to be the best ad of all time. Directed by Ridley Scott, it was the first truly cinematic commercial, forever changing the nature of Super Bowl advertising.
But then bad things happened. When John Sculley pushed Steve out of Apple, he also gave Chiat its walking papers. He replaced Chiat with BBDO, which was Sculley’s ad agency back in his Pepsi days.
The advertising community was outraged. As common as it is for agencies to get canned, this firing seemed so unfair after all the fantastic work Chiat had done.
It took a while, but 12 years and two CEOs later, Steve Jobs was running Apple again. And advertising justice would finally be served.
The revenge of Chiat
Within weeks, BBDO was out and Chiat was back in. Steve faced a mammoth task restoring Apple to greatness, and he wanted a creative agency that shared his passion. He certainly didn’t want Sculley’s leftovers.
Suddenly Lee Clow was once again doing the job he loved most: working with Steve and Apple.
The rest, as they say, is history — for both Apple and Chiat. A series of Chiat campaigns played a huge role in the resurgence of the nearly bankrupt Apple. First came the Think different campaign, then a run of new product launches that helped turn Apple into the most valuable company on earth. That included iMac, MacBook Air, iPod/iTunes, iPhone and iPad.
Chiat authored the Mac vs. PC campaign that many (including me) consider to be the best advertising Apple has ever run. With 66 commercials running over four years, this campaign caused endless buzz and helped boost Mac’s market share dramatically.
It’s a rare agency that contributes so much to a company’s growth over such a period of time.
Steve Jobs, master marketer
Most CEOs keep marketing at arm’s length.
Steve was not only involved in marketing — he loved it. And, as should be obvious to all, his skills in this area weren’t too shabby.
He presided over the regular marketing meetings with the agency, conducted major project briefings himself, and was present at every advertising checkpoint from start to finish. No matter how busy he was, he made himself available to discuss advertising any time of day or night.
Steve was not a dictator when it came to marketing. He wanted to hear others’ opinions, but he would often challenge and debate.
All of us in the room — including Phil Schiller — knew what it was like to be vetoed by Steve when our arguments failed to convince.
Part of the family
With marketing so close to his heart, Steve treated Chiat like a partner, not a vendor.
In fact, he treated Chiat as if it were an extension of Apple, to the point where he would even invite key agency people to Apple’s secret “Top 100” meetings.
There was a ton of mutual respect in this relationship. Which is why, in marketing’s world of fleeting relationships, Chiat has remained Apple’s agency for 17 years.
Does that mean Steve never got frustrated with the agency’s performance? Of course not. There were plenty of blow-ups along the way, because that was Steve’s nature. He was passionate about getting every detail right, and sometimes his passion boiled over.
But Steve was also realistic. He knew that talented people who really “got” Apple were hard to come by, and that starting over with a new agency would be a huge undertaking with unpredictable results. No doubt he also appreciated the many times Chiat had delivered extraordinary work.
So, for Steve, the nuclear option was what nuclear options tend to be: 99% unthinkable.
The questions begin
Since Steve passed away, Apple critics have had a field day pointing to the signs that Apple is doomed — even if the facts don’t quite support their conclusions.
Being largely subjective, advertising is a particularly easy target.
Whether or not Apple’s advertising has suffered without Steve, one can’t deny that “things have changed.”
Steve is gone. Phil now leads the advertising effort. And Lee Clow has removed himself from the day-to-day business of the Apple account.
So, in a business where relationships are everything, the relationships between Apple and Chiat are not at all what they used to be.
Advertising after Steve
Has the nature of Apple advertising changed since Steve passed away? See above note about advertising being subjective.
In my opinion, the answer is yes. In general, Apple ads now feel “softer.”
Compare the philosophical Designed in California and What’s Your Verse? ads to the wildly entertaining Mac vs. PC ads. The newer approach has resonated with Apple customers, but they aren’t disruptive like ads that came before. They don’t generate the same level of awareness.
We’ve also seen one bona fide disaster after Steve’s time, with the Genius campaign that aired during the 2012 Olympics. This effort was wrong in so many ways, it made people wonder “How did this even happen?”
Did the agency push for this work despite Apple’s reluctance? Or vice versa? Or did Apple and Chiat march hand-in-hand over that particular cliff?
Remember, it takes two to tango.
About that “coolness” gap
According to the newly-revealed emails, Phil Schiller was unhappy about Samsung’s surge and felt that “things had to be turned around.”
The idea that people would see Samsung as cooler than Apple was unthinkable just a couple of years ago. Now the WSJ was writing that the tide is changing.
For the sake of argument, let’s assume it’s true. Would that be Chiat’s fault?
Only to a degree. I can buy the idea that if the ads were edgier, Apple might not have seemed quite as listless while Samsung was issuing a stream of new products.
But Apple doesn’t get off the hook so easy. What makes Apple truly cool is its product portfolio. The products are what capture imagination and cause the buzz. When Apple releases a bigger-screen iPhone and an iWatch later this year, will anyone be talking about a coolness gap?
And then there’s the little matter of budget. Samsung is spending 3x-4x what Apple spends for advertising, appearing on broadcasts such as the Super Bowl and Oscars while Apple sits by. It blankets cities and transportation hubs around the world with advertising, while Apple remains quiet.
So is Chiat really falling down on the job? Or do they make a convenient scapegoat?
Who’s the culprit?
When Phil would offer an opinion about advertising to Steve, Steve responded as the chief marketer.
When Phil offered his opinion to Tim about changing ad agencies, Tim responded as an operations guy.
With his “If we need to do this, we should get going” reply, he wasn’t exactly pressing for a lot of detail.
The fact is, if there really are irreconcilable differences in the relationship now, the real problem could be on either the Chiat or Apple side.
It could well be that Phil is most effective in the marketing role he served with Steve, where his job was to advise — but his marketing instinct and creative taste were not the deciding factors.
How Apple works with its agency is a matter of extreme importance. Tim Cook should be looking at all the facts and making the decision himself.
The bottom line
Sorry, I need to revise something I said earlier.
Steve Jobs did treat Chiat as a partner. However, he was the senior partner.
Not to depress anyone thinking of a career in advertising, but that’s the way it is in agency-client relationships. The client pays the bills, so the client gets to decide.
It’s the client who can keep rejecting work or asking for revisions until they see something they like. It’s the client who accepts or rejects the final versions of the ads. It’s the client who chooses what agency to work with.
Which explains this old saying in the ad biz: “Clients get the advertising they deserve.”
We don’t know what’s going on right now in the Apple-Chiat relationship. We can’t predict what kind of ads Apple will run in the future, or what agency will be creating them.
There’s only one thing we do know: Apple will get the advertising it deserves.