“We work in an industry where people invent technology to avoid what we create,” says the Droga5 founder. Can he find a way forward for the ad business?
Just over a month after Donald Trump was sworn in as the 45th president of the United States, The New York Times launched its first major ad campaign in recent memory. At its center was a powerful, minimalist TV commercial that debuted during the February 26 Academy Awards broadcast.
In the spot, the disembodied voices of cable-news pundits chatter away as various statements flash in black letters on a plain white screen:
The truth is our nation is more divided than ever.
The truth is alternative facts are lies.
The truth is women’s rights are human rights.
The truth is we have to protect our borders.
It concludes with a tagline: “The truth is more important now than ever.”
The commercial went viral, racking up more than 15 million YouTube views. Stephen Colbert made a parody version, publications across the country covered it as a news story of its own, and the president himself turned his Sauron-like eye on the campaign via his favorite channel of unfiltered communication, Twitter: “For first time the failing @nytimes will take an ad (a bad one) to help save its failing reputation. Try reporting accurately & fairly!”
For first time the failing @nytimes will take an ad (a bad one) to help save its failing reputation. Try reporting accurately & fairly!
— Donald J. Trump (@realDonaldTrump) February 26, 2017
For ad-industry watchers, it was this repetition and amplification of the original message across so many channels that was most impressive. In fact, it’s one of the signatures of the New York–based agency that created it, Droga5. From its founding in 2006, the company has looked for novel ways to feed its messages into the larger media and pop-culture machine, dramatically increasing reach and impact. The strategy doesn’t always work, but when it does—as with the New York Times campaign—the effect is significant. “Just knowing you’re putting something out there that could take on a greater life, that’s our sweet spot,” says David Droga, the agency’s Australia-born founder and creative chairman. “That’s what we try to do.”
Droga—who has a reputation for being outspoken, edgy, and critical of his industry—is one of the ad business’s key thinkers at a moment of major uncertainty. Last year, digital marketing in the United States exceeded television advertising for the first time, with $72.5 billion spent online versus $71.3 billion paid for TV spots, according to a PricewaterhouseCoopers report. With 30-second TV spots increasingly being replaced by programmatic advertising on Facebook and Google, the creative work done by traditional agencies matters far less than data analytics and targeting.
Yet despite these industry-wide challenges, Droga5 is thriving. As an early master of virality and shareability in the Facebook–YouTube era, Droga has learned how to cut through the clutter. His company won $65 million in new business in 2016, and total revenue was up from $126 million in 2015 to $170 million last year. The agency is as comfortable with social media strategy as it is with big-dollar TV spots, which has attracted a wildly diverse roster of clients, from Chase (for which it helped a New York bakery create a viral sensation around a giant doughnut as part of a credit-card campaign) to deep-pocketed athletic-wear brands such as Under Armour (celebrity-stoked ads starring Michael Phelps and the ballerina Misty Copeland) and tech firms like MailChimp (a surrealist, multipronged effort designed to increase brand awareness). Last year, Droga5 even did a few ads for the Hillary Clinton campaign, including a widely shared spot that depicted kids watching some of Trump’s most notorious statements. “I look at the strategy and what happened, and secretly I wish we spent more time building her up, rather than attacking Trump,” Droga now says. “We were so emotionally invested in that idea [of going after Trump].”
As Droga’s approach has gone mainstream, competition has increased significantly. Several of the planet’s biggest management consultancies, including Accenture and Deloitte, are creeping onto Droga5’s turf by buying up smaller ad firms and folding them into their portfolio of services, and virtually every major brand, from Boeing to Pepsi, has launched in-house ad divisions, cutting out independent agencies with years of messaging expertise. And within the agency world, shops both small and large are embracing data and technology as part of the trend known as “Agency 3.0.”
Like the rest of us, Droga generally finds advertising invasive and annoying. As he notes, “We work in an industry where people invent technology to avoid what we create.” Which is why he’s relentlessly focused on crafting campaigns that consumers receive willingly, because of their humor or pathos or just by virtue of being really interesting. “Droga has incredible range,” says David Rubin, The New York Times’s head of brand. “They have the ability to tell stories in lots of different emotions, and that’s really important.” Droga himself has a simple take on what his agency does best. “It’s crude, but the essence, whether we’re talking to a billion-dollar client or a startup, is: Why would anyone give a shit about what we’re making?” he says. “Not, Do we think it’s cool or clever or funny or worthy? It’s, Why is this relevant?”
Droga is sitting in his corner office at the company’s Wall Street headquarters. The agency moved to the handsome prewar tower in 2014, and it recently expanded from five floors to eight. “At first, I was like, ‘No fucking way am I moving to Wall Street,’ ” says Droga, whose firm was previously housed in a loftlike space in the hipster-friendly zone of NoHo (there is also an office in London). “But when I saw the building, it was unbelievable—so now there’s this sea of plaid and facial hair coming out of the subway every morning.”
He’s wearing a slouchy blue blazer, white polo shirt, tan corduroys, and a pair of artfully battered work boots. An oversize black-and-white photo of Muhammad Ali dominates the wall behind his desk, part of an excellently high-low mix of objects on display—from big-ticket pieces by artists like Ai Weiwei to a replica of racing legend Ayrton Senna’s helmet. Droga’s office also contains the first piece of art he ever purchased. (He’s now a major collector, with a particular interest in Chinese art, and sits on the board of New York’s New Museum.) It’s a small sculpture, set into a deep frame, depicting a pair of cartoon spiders gazing at a web that blocks the bottom of a playground slide. A caption taped to the frame reads, “If we pull this off, we’ll eat like kings.” When he was 18, Droga spent all the money he had—something like $2,000—to buy the piece, which turns out to be one of a very small series of three-dimensional Far Side comics created by the cartoonist Gary Larson. “All my friends were like, ‘What are you doing buying that thing?’ ” he recalls, laughing. “But I was just so drawn to it.”
The anecdote, along with the piece itself, captures a lot of what drives Droga: an attraction to simple, hilarious ideas; a comfort with risk; an obsession with images that move him. He grew up in rural New South Wales, Australia, where his father owned and ran a ski resort and his mother, who is from Denmark, was an artist. Droga was the fifth of six kids; the agency’s name comes from labels his mom sewed in his clothes. “My mother couldn’t give a fuck about”—he gestures around the office—”this. I mean, she’s happy that I’m successful, but she judges everything on, ‘What are you doing for others?’ and ‘Are you creating beautiful things?’ My father, on the other hand, was a classic well-educated businessman. I’m kind of like both of them: My mother grew up wanting to save the world, and my father grew up wanting to rule the world.”
Despite the shots Droga likes to take at his profession—within a few minutes of meeting him he’ll tell you that he doesn’t watch commercials on TV and that most of advertising is just “chest-puffery” or “fireworks that disappear the second they’re out there”—it’s all he ever really wanted to do. He skipped college and got a job in the mailroom of a Sydney agency at age 18; just four years later, he was a partner and creative lead at another Australian firm. By the time he started Droga5, he had made his way, via increasingly prestigious posts at ever-larger agencies, from Sydney to Singapore to London to New York, where he landed as the worldwide chief creative officer at Publicis—a job, he likes to say, that was so well compensated and influential that you’d have to be crazy to quit. But Droga did leave, wanting to escape the ever-consolidating, increasingly corporatized industry, and also to grow a business of his own.
Droga5’s very first work established its influential sensibility. In 2006, back when the agency had just a few employees, it created a digital spot for streetwear brand Ecko Unltd in the form of a highly convincing lo-fi video that appeared to show founder (and graffiti artist) Marc Ecko breaking into Andrews Air Force Base and tagging Air Force One. The clip became an early viral smash. A series of much-discussed campaigns followed: In 2008’s “The Great Schlep,” Sarah Silverman encouraged Jewish grandparents to vote for Barack Obama; 2014’s “If We Made It” had the beer brand Newcastle describing the Super Bowl ad it would have made, if it only had the budget.
In 2013, Droga sold 49% of his agency to the Hollywood powerhouse WME, for a reported $225 million. The move has created some interesting opportunities, not least of which was the possibility of taking on Hollywood stars as clients. There are now four or five of these deals, including one with Dwayne “The Rock” Johnson. Droga5 helped Johnson team with Under Armour (another Droga client) for a line of popular shoes and athletic wear, and the agency promoted the star’s latest movie, a Baywatch remake, by concocting a viral stunt that involved hundreds of people jogging through L.A. in slo-mo, in a nod to the Baywatch TV series’ cheesy beach-running sequences.
This sort of broader thinking is now at the center of Droga5’s business. Its strategy team—which has grown in importance over the years to become a pillar of the agency—offers clients help with product development, social media planning, website design, PR tactics, and branding. “Last year, our agenda was, How do we achieve the type of Droga5 work we’re known for and scale?” says Droga5 global CEO Sarah Thompson. “This year is very much about, How do we affect our clients at a more business-transformation level?”
Jonny Bauer, Droga5’s global chief strategy officer, kicks back on a sofa in his office beneath a large neon sign that reads WITH FULL CONSENT—created by his wife, the conceptual artist Jill Magid. A nearby sideboard is stocked with bottles of cognac, whiskey, and champagne (Droga5’s credenza budget can’t be insubstantial, as virtually every office is equipped with a vintage teak cabinet). To Bauer, the advertising industry has reached an inflection point that Droga5 is uniquely positioned to exploit. “The biggest question is around design and what role that plays,” he says, in an accent tinged with his native Australia. “We’ve always been a nontraditional, integrated advertising agency that will do more than just TV ads. But our focus now is bringing design thinking into the development process to inform the experience: What is the product, what is the web presence, what innovation should they be creating, what is the business case around those innovations?”When the agency takes on a new client, Bauer’s team begins a deep-dive research mission—sifting through financials, launching ethnographic research on customer behavior, embedding with various parts of the business. The goal is to unearth the client’s purpose (a word you hear constantly at Droga), which is the idea from which everything else will emerge. In Bauer’s view, it’s this process that gives the agency its biggest edge.
If you want to see this in action, the best place to go is the spiritual center of Droga HQ: a glass-walled conference room that floats above a grand staircase-slash-amphitheater connecting the agency’s 10th- and 11th-floor spaces. It’s called the Creative Box, and it’s where the Droga teams often confer with clients. One early May afternoon, the agency is hosting a strategy meeting with executives from new client Mattress Firm, the top retailer in an industry that’s found itself challenged by nimble bed-in-a-box players like Casper and Leesa. The meeting explores every interaction a customer might potentially have with the brand, from an initial Google search to post-purchase engagement. “All the bed-in-a-box guys are playing in that post-purchase space,” notes Droga strategist Dan Neumann. “With sheets, with pillows . . .” A colleague interjects, “With dog beds!”
When Droga5 started working with Mattress Firm, the strategy group had identified sleep tech—everything from cooling mattress pads to adjustable bedroom lighting—as an area ripe for the company to explore. Today’s meeting comes as Mattress Firm is preparing to roll out the first result of this plan: a new tech-infused product, the Beautyrest Black Hybrid mattress, which claims to use “multitouch” memory foam in a new way. A few weeks later, it will be revealed with an Apple-style keynote, hosted by Steve Wozniak, that Droga5 concocted. The agency also came up with a tagline for an entirely new category of Mattress Firm products: “Technology to Power Off.”
This big-picture approach is where Bauer envisions the most opportunity for the agency going forward: using the kind of thinking the company originally developed to help inform the messaging, but applying it to deeper levels of problem solving. Droga5 is doing this type of work—developing new products, refining customer service, streamlining the shopping experience—for a whole range of clients, from Sprint to Pizza Hut to Chase. “It’s about integrating the brand and the experience together,” says Bauer. “We’re having the core conversations about how they build their business.”
The way Bauer sees it, even the ad world’s most notorious recent debacle—Pepsi’s epically tone-deaf spot in which Kendall Jenner attends a Black Lives Matter–style protest and offers a police officer a beverage—was more of a strategic failure than a creative one. Which is to say, a kind of failure that Droga5 is strongly inoculated against. “What role does Pepsi have in the world?” Bauer asks. “Key peacekeeper through product sipping? That doesn’t seem like a credible strategy. No matter how beautiful the model or how poetic the music or how cinematically it was shot, no one asked the fundamental question: What is the right thing for this brand to be doing in this world? And we spend a lot of time getting to the heart of what that is.”
Not insignificantly, that Jenner spot was made by PepsiCo’s recently created in-house agency, which has increasingly been taking over messaging efforts from the brand’s various marketing partners. As a result, some industry watchers point to it as a prime example of the dangers of forgoing the perspective and expertise of outside shops such as Droga5. “I actually took less glee from it than I probably should have,” says Droga. “It just felt like another black eye for us as an industry. But what makes me optimistic is there’s work out there made with consideration, thought, and respect. Just thinking that the consumer isn’t an idiot or a moron is a great starting place.”
Every so often, Droga gathers the entire creative department at the office’s central staircase and runs through what’s happening with the agency. At one such recent meeting, he starts by announcing a slew of new awards the team has won. (Since it launched, the company has racked up more than 100 Cannes Lions, the industry’s most prestigious recognition.) Next, he shifts to new business. Under Armour was talking to a popular rapper about possible collaborations, and it turns out he is a major Droga5 fan. Droga tells the team about a recent phone call between the two of them. “He asked, ‘Do you guys do music videos?’ I said, ‘Not really.’ And he said, ‘Well, you guys are doing my next music video.’ ” Everybody laughs. When Droga asks for volunteers to work on the project, a few dozen hands shoot up.These are the kinds of opportunities that are often coming Droga5’s way—projects that leverage the company’s skill set in entirely new ways. The New York office’s second floor now houses the agency’s new production company, Second Child. There’s a vast photo studio, bank after bank of editing suites, even podcast facilities. The idea is that Second Child can speed up the turnaround of work generated upstairs, as in the case of some recent New York Times ads that were created in the facility. It can also take on projects unrelated to agency business.
One recent success was Tree, a virtual-reality short film that was executive produced by Droga5 and appeared at the Sundance and Tribeca film festivals. Using an Oculus Rift headset and a multisensory array of scent machines, fans, and portable heaters, the film turns the viewer into a tree in the Amazon rain forest—experiencing its entire life, from seed to eventual death by clear-cutting. There’s no client to bill, or really any money to be made from the project, but to Droga it’s been well worth the investment because it adds to the agency’s understanding of a crucial new medium.
These days, Droga5 is thinking about campaigns as broad multimedia events that go far beyond the usual TV, online, and mobile content and into more unexpected forms of communication. Its recent MailChimp work, for example, was a hyperambitious nine-campaigns-in-one mega-ad that tested every skill a modern agency needs to thrive today. To raise awareness of the email-marketing service, Droga5 created a whole range of wacky interconnected content that hinted at the brand’s name, from a legitimately popular song (by a new band called VeilHymn, which included indie star Dev Hynes) to a series of surreal short films to a line of snacks (Fail Chips), which were distributed nationwide. Interestingly, the campaign gave virtually no indication of what MailChimp does—because Droga5 was confident that potential customers would find the content intriguing enough to take that next step themselves.
But no matter how ambitious and complex his company’s work gets, Droga still measures success by one primary metric: impact. “It’s not about being the biggest or the place with the most pins in a map,” he says. “We want to be the most influential. We talk about trying to build the most influential agency in the world.”
This article first appeared in www.fastcodesign.com
Seeking to build and grow your brand using the force of consumer insight, strategic foresight, creative disruption and technology prowess? Talk to us at +9714 3867728 or mail: firstname.lastname@example.org or visit www.groupisd.com