ALAN ABRAMS
Special to the Jewish News
T
his was not a merger, "
insists Mort Zieve, chair-
man of Simons Michelson
Zieve (SMZ) Advertising,
when he talks about his company's
acquisition in August of "the
accounts, business activities and the
key personnel" of long-time competi-
tor Stone, August, Medrich and Co.
(SAMCO).
The deal has brought together two
of the Detroit area's oldest Jewish-
owned advertising agencies. SMZ's
name will remain on the front door.
Both agencies were based
in Troy in office buildings
separated only by a restaurant. ',9'
And both have pedigrees
extending back to the 1920s.
The newly bolstered SMZ ?,
will now have annual billings
of $65 million and 75
employees, said SMZ
President Jim Michelson.
SMZ's 1998 billings were $42
million and SAMCO's were
$23 million.
SAMCO's billings were a
considerable drop from the
$39 million reported for their
predecessor, the Stone, August
and Baker agency, in a 1997
Jewish News profile.
The surname of Mel
Medrich, the former SAMCO
vice chairman, replaced that
of Baker in the company's
name after Stone, August
acquired the Ann Arbor
agency in which Medrich was
a partner.
That $16 million drop in
annual billings may have has-
tened SAMCO's decision to be
acquired by its competitor.
Advertising industry insiders have
said that despite their longstanding
presence in the advertising communi-
ty, Stone & August had faced lots of
turnover of staff and accounts. One
insider, who asked for anonymity,
said, "They lost Florine Mark's
Weight Watchers Group Inc. account
a few years back after a long run, and
never seemed to replace those kinds
of signature accounts with other
heavyweights."
SAMCO lost several public rela-
tions accounts in the months before
their acquisition by SMZ. Stone said
the two agencies had previously
talked about the possibility of pooling
their Yellow Pages business divisions.
"One thing led to another and we
started looking at the possibility of
putting this thing together. And four
months later, it was culminated."
Space has been made for 21 former
SAMCO staffers, mostly senior peo-
ple, in creative, account services and
production.
Nineteen SAMCO employees were
not given jobs at SMZ.
SMZ did not acquire SAMCO's
liability or debts. None of the princi-
pals in the deal would discuss the
purchase price.
Although their names aren't being
incorporated in the SMZ logo, the
three senior principals at SAMCO are
Still, it is significant that neither
together now, after so many years as
Stone nor August will actually hold
competitors, sometimes even vying
any of the customary titles at SMZ,
for the same accounts?
such as co-chairman, co-president or
"Because the world is changing,
vice president.
the marketplace is changing,"
In contrast, when Stone,
explained Zieve.
August acquired his agency,
"Clients, rightly, are
SMZ heads
Medrich was given the vice
demanding more service and
Ron Stone,
chairman title and responsi-
more depth, and a wider
Jim
bilities.
range of services. And the
Michelson
Stone said the efforts of
more depth and breadth that
and Mort
the former SAMCO team
you have in your agency, then
Zieve.
have already resulted in SMZ
the more you can offer to a
picking up a new public rela-
client.
tions account.
"And you have the ability to
It has not been disclosed whether
attract a higher caliber of people to
Stone and August have long-term
the agency. It gives you more stability.
It gives us a better presence."
He added, "It puts us in a
unique niche in Detroit. You
have a whole bunch of the
local agencies that are here,
with annual billings of $20
million, $30 million, $40 mil-
lion, whatever. The usual sus-
pects. Then you have the 6 bil-
lion dollar mega monoliths
that are more financial entities
than agencies.
"We are in the middle of
them. Which means that we
can offer all the abilities and
services of any of the largest
agencies, but we still retain the
close, personalized service of a
smaller agency. There isn't any-
body else in town offering that
broad range of services."
"And SAMCO is comple-
mentary with us. It enabled us
to have a wider range of ser-
vices, They are very strong in
business-to-business, very
strong in public relations. It
gave us an added strength in
those areas that we did not
have," said Zieve.
SMZ's client roster includes Elias
Brothers Big Boy Restaurants, Inc.,
AAA Michigan, the Detroit News,
Fairlane Town Center, Great Lakes
Crossing, the Michigan Lottery, the
Nederlander Group/Fisher Theatre,
Republic Bancorp Mortgage and
WDWB TV20.
Other clients include the Barbara
Ann Karmanos Cancer Institute, the
contracts with SMZ for their services.
Wellness Plan, the Michigan Opera
Both men have been key players in
Theatre and the Holocaust Memorial
communal affairs, with strong ties to
Center.
decisionmakers in the Jewish
"Our business is a business of ideas,
Federation of Metropolitan Detroit.
Medrich and Rich Williams,
strategy, marketing plans and policies,
SAMCO senior vice president, will
and the more brains we have to put
into that, the better," said Zieve. "Here
continue as senior management offi-
cers of the combined companies.
you have three senior guys with a lot of
marketing experience. This is almost
So why did the two agencies come
SMZ advertising moves up a notch
with the acquisition of SAMCO.
all at SMZ as part of the deal.
Both Stone and former SAMCO
President Jim August will be execu-
tive management advisers to SMZ,
said Zieve. "They will concentrate
upon new business development,
account planning, public relations
and healthcare strategic services."
"We will be advising on future
planning for business," added Stone.
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