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In my favorite episode of the greatest TV show of the 21st century, cash is king. As a way of cutting a Gordian Knot of corporate merging (put a pin in that for a moment), the would-be founders of Sterling Cooper Draper Price are deciding which accounts they can bring/poach so that they have a puncher’s chance of getting the business off the ground.
The lynchpin of the operation’s success is leading the cash cow of tobacco giant Lucky Strike to their new Madison Avenue pasture. What Lucky Strike represents for SCDP isn’t prestige or guaranteed riches but something even more important for a fledgling business: cash flow. Lucky Strike means not just “fine tobacco” but a ready and reliable source of cash to spend on the firm’s operating expenses: payroll, rent, and the humdrum costs of doing business. This is the foundation on which smaller and more speculative clients (the upstart sport of Jai-Lai and the unglamorous laxative brand Secor) can be carefully stacked. This is the rock upon which they decide a marketing church can be built. And, in the end, they are right. In the very next episode, which kicks off Season 4, we jump forward to a fully armed and operational…well operation. Secretaries clack away, and junior execs mill about, and copywriters sit around figuring out how to make suitcases interesting. Be careful what you wish for, for you will surely get it.
Because ultimately, as a service company, Sterling Cooper Draper Price’s greatest asset is its client list. Everything else the firm does is in service of getting and retaining that list.
It’s the realization that gets me. Don Draper has a moment where he realizes they can just quit (or rather have a co-conspirator fire them) and take their clients with them. It’s that simple.
When reading Dan Sinykin’s recent book, Big Fiction, I thought of this scene. The conglomeration of advertising firms dramatized in Mad Men is contemporaneous with the corporatization in book publishing that he chronicles. The stories are strikingly similar: family/closely held companies establish profitable companies in growing industries and thus become morsels for larger companies to gobble up.
The size, complexity, and sheen of the companies built on both books and advertising masked essentially simple businesses. In advertising, it was acting as a broker between the Hiltons and Kodak’s of the world and the newspapers, radio, magazines, and TV that had ad space to fill. In book publishing, it was (and is) acting as a broker between writers and the book-buying public. This is valuable work to parties on both sides of the transaction, but with conglomeration comes a focus on profit-seeking–and, more consequentially, expanding profits.
What if it were possible for some renegade group to break off a major publisher and create their own version of Sterling Cooper Draper Price? Rather than succumb to the Borg, they jumped in a shuttle and established an outpost somewhere? Who would do the breaking off, and what would they take with them? Put another way, what is portable that the people with money to spend want? In Mad Men, it was the ideas from Don Draper and the personal relationships forged by Roger Sterling/Pete Campbell, and a little business acumen provided by Layne Price. This could be done in publishing.
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