John Denholm

By The Drum, Administrator

November 17, 2006 | 11 min read

Nineteen eighty-four. The fashion faux pas now seem a world away. The days of long lunches and even longer cigars. Scottish advertising was booming. Agency names propelled their eponymous owners to heady heights, stiff leather thrones cradling their designer-clad derrières as million-pound accounts were signed off faster than the passing Ford Capris. A rosy picture, perhaps?

While the giants of yesteryear – Rex Stewart, Baillie Marshall, Morgan Associates, Grant Forrest, Shaw – were stomping their path through the lush advertising landscape, two of Scotland’s most revered agencies were readying for launch. Faulds and The Leith Agency. But while Faulds finally closed in 2003 following a high-profile liquidation, The Leith Agency has continued to prosper.

It was from Hall Advertising, the top predator of Scotland’s advertising landscape, that the Leith Agency emerged. Formed in ’84 by Pete Mill, Roger Stanier and John Denholm, Leith has gone on to take on the mantle once held by its founders’ former agency. And following more than 20 years at the helm, founding director John Denholm has now relinquished control of the agency, following its take-over by the Cello Group.

Sitting in Malmaison on Leith’s shorefront, the “overflow office”, Denholm has just been served coffee. He leans forward with a wry smile: “I was a little embarrassed when I read in The Drum that I was responsible for bringing in all that business to Hall’s [Royal Bank, Standard Life, Scottish Tourist Board, Scottish Office]. To be honest, most of it was there before I joined. Just thought I’d point that out.”

Denholm joined Hall’s in 1980 as an account director from Scottish & Newcastle. Finding it hard to progress up the corporate ladder at the drinks giant, the gamekeeper turned poacher and hopped over the fence to agency life.

“I realised I was unsuited to forcing my way up to the top,” says Denholm. “It was perhaps partly because I was lazy. I’ve always found it difficult to get going unless I am a little scared. If you are like that, a big company is not for you – you tend to disappear. You are just a small cog in a big machine. So I came to the conclusion that, if I was going to get on, I would have to put myself in a much smaller and more accountable, pressurised and scary environment.”

With that, Denholm left client life to join Hall’s, one of the “smaller” agencies being used by S&N. “What struck me within the first few months of moving to Hall’s from the client side was that as a brand manager with a couple of million quid budget in your pocket, it’s very easy to believe all these friends you’ve got in business think you are a great guy. But it brings you up short when you move to the other side and suddenly realise that it wasn’t you they liked so much, but your budget. But that’s reality. And reality is better than make believe. Besides, it was a very exciting time to join Hall’s.”

The agency had a good holding in institutional and governmental clients, “all of which were there when I arrived”. Again. It mirrored the Scottish market place of the time. What it lacked, though, was a notable consumer-led brand product.

While he is quick to point out that he played only a small role in the growth of Hall’s, it was Denholm who managed to help turn around the agency’s inadequacies in this area, pitching for and winning Old Parr Deluxe Scotch Whisky within the first few months of his arrival. Old Parr was one of the top three premium brand whiskies globally at the time, and it firmly planted Hall’s on the consumer goods map. This win was followed by a knock on the door from the marketing manager of Bass in Burton-on-Trent. “As it happened, I was in the right place at the right time for that one, having spent the last four years at S&N,” says Denholm.

Winning the Bass account in ’82 created a 25-year legacy for Denholm as he maintained a connection through Bass and Tennent’s to Coors and Carling at The Leith Agency.

Leith, when it launched, was one of the first agencies in the UK which called itself something other than a string of surnames. “We wanted to be a bit different and we felt that Leith had a certain bohemian ring to it,” Denholm says. “Leith, as an area, was just starting to see the glimmerings of its resurgence – Skippers restaurant was the saving grace. But the main reason that we didn’t name it after any surnames was that, of the original three directors, no one was dominant. It was only because I was an account man and wore a suit that I got to be MD. As joint creative directors, Pete Mill and Roger Stanier had just as much say as I did.”

The first seeds of start-up talk were planted one evening at Shepperton Studios following a shoot for Tennent’s Special. The trio were in the bar following a long day, enjoying the fruits of their labour, when the idea that they could actually be doing it for themselves was mooted. The idea took root...

“If you don’t dismiss the idea in the next 30 seconds, you’ve had it,” says Denholm. “The management at Hall’s had a fixation for bringing people up from London and putting them into senior positions ahead of the home-grown talent. That made it easy for people to break away. Enlightened human resources was a thing for the future.”

With that, The Leith Agency launched. Lorna Cameron was the fourth member of the start-up team. She was, and still is, the receptionist at the agency. “She has been a constant. In fact, now, she’s the only constant left.”

Hall’s had a great creative reputation at the time, but when Leith launched, it was in a good position to take over that creative mantle and cement it, says Denholm. “At that time, Hall’s had become introverted. The effect of the Saatchi takeover [a couple of years prior to Leith launching] was beginning to really take effect. There were management changes, people with the wrong cultural attitudes were being imported from Saatchi, and Hall’s was losing its place.

“You go into a quick descent if you forget your creative heritage and instead go for growth and volume. At a time when we were pushing our creative credentials, our main rival had lost its way in terms of understanding its heritage.

“The opposition made it easy for us. And that was a lesson going forward. Any agency is going to suffer from defections and breakaways, but you really have to shore up your defences as hard as you can when it happens. Hall’s didn’t.”

Leith’s first client win was Western Autos, but the agency grew slowly – “slower than we would have liked and slower than we expected in our business plan”. The original business plan had clients such as Bass, RBS and the Scottish Tourist Board joining up with The Leith Agency – but none arrived until at least five years later.

“Our first TV commercial was for the King’s Theatre refurbishment. The budget was about a grand, but we did something really creative that won national awards. We used the smaller clients to build our creative reputation.

“Our first big client was Clydesdale Bank, but that took about three years to arrive. When we won Clydesdale we had to hire more staff, and that meant a move. By then we had hired Gerry Farrell and Les Watts from Hall’s, David Reid and others. Clydesdale had a domino effect – shortly after that we won Drambuie and Bass. And it grew from there.”

When asked to recount the high times, Denholm ems and ums – perhaps there are too many to mention. Remembering the difficult times comes a lot easier: “We were continually up against it financially for the first few years. We were on the brink of trading insolvently several times. We were literally scrabbling around asking for cheques to pay the wages.”

But times change. Perhaps most so in the change in agency culture over the years. “Regrettably, long lunches are pretty rare these days,” laughs Denholm. “On the rare occasion that you’re out and you realise you don’t have a meeting to dash back to, it’s great. It’s very liberating. However, if that happens more than twice a year...

“Going back 20 years it was a weekly occurrence. Everything is now measurable and accountable, but we are in the business of communication, giving people dreams and aspirations and grabbing their imagination. You can’t do that solely by numbers.

“You need to allow the space and creativity to do that. That means trust. And that means trust between the agency and the client. If you say to a client that you are proposing to spend £10 million of their money, then the only way you are going to get that client to press the button is if they can trust you. They will only trust you if they know you. If you sit in meetings and talk jargon, go through charts and go through the whole emperor’s new clothes routine, you never get to know people. And, more importantly, you never get to trust them.”

Leith opened a London office in 2000, a long-held ambition of Denholm. “My whole view of the London scene was coloured by a competitive streak. I’m always hugely resentful of the complacent, introverted tone that can come from London. But eventually we decided we had to be there to compete. Without London, we would never have completed the Cello deal; and we won lots of business from the back of it. It cost us a lot of money, and we only started to get it repaid in the last couple of years, but it gave us the profile.”

The only unfortunate blot on the horizon was losing Carling. But, against what many people believe, the loss of Carling still left Leith London profitable, according to Denholm. Smaller, but profitable.

Prior to the completion of the Cello deal in 2004, Leith’s success had attracted some amorous advances.

“We had various offers for the company over the years, but most came to nothing from an early stage,” Denholm says. “One of the global networks made an offer, but it was a typical big network offer. It was based on such a small up-front payment and a tight earn-out that, when you peeled it all away, the offer was laughable. We’ve had several similar offers in the past.

“Effectively what these groups are saying is, ‘We would like to buy you, but we will buy you with your own money, the money that you earn over the next five years’. That’s never an attractive prospect.

“Happily, we came across the Cello guys. What they were interested in was building a folio of high-quality, high brand-value companies – and the brand value of Leith was fully recognised in that deal.

“I’ll avoid the usual propaganda here. It was an opportunity to grow the business further, and it benefited everyone. That’s true, but it was a chance to get some money and, finally, after 20 years of hard work, take some of the risk out of life. I won’t deny that. And genuinely, because Cello was a small start-up group with a good philosophy, it really felt like we were buying into something.”

Denholm, having almost severed his links to the agency following its sale to Cello, remains as non-executive director, “effectively chairing board meetings once a month”.

“I have plenty of other things to keep me busy now,” he says. Including Denholm Associates, the recruitment business founded by his wife Nicki. And while he may be busy at present looking to finalise a couple of further non-executive roles, he certainly won’t be doing a Jim Faulds. “He’s got more energy than I have.”

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