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Advertising agency Joe Public United this year took eight gold Loeries, was crowned the Agency of the Year and won the Medium Business Entrepreneurs of the Year Award against 189 other business entries in the Entrepreneur of the Year® competition sponsored by Sanlam and Business Partners.
But it has been a tough journey to the top. Pepe Marais, co-founder of the company, spoke to finweek.
What did you do before starting Joe Public?
Growing up poor – by old South Africa white standards – my goal as a school boy was to become a civil engineer, a job I equated with lots of money and a better life.
I changed my mind after a chance encounter with a graphic designer at an air force base in Rundu, Namibia, while on my way home after finishing my two years of compulsory military service.
Up until then, I had never imagined it possible to make a living from my creativity.
So, after the army, I did a graphic design course at the Ruth Prowse School of Arts where I finished top of my class each year.
From there I started working for an advertising agency.
Why did you start your own company?
Gareth Leck and I launched Joe Public in 1998 to make advertising more transparent and accessible to the person on the street.
We came up with an advertising model that allowed people to order rare, medium or well-done ideas from a menu, like you would order steak at a restaurant.
People would walk into our diner-like shop in Loop Street, Cape Town, give us a briefing and receive their work a few days later.
Where did you receive start-up funding?
We tried to get an investor, but they wanted an 80% stake in the company which did not appeal to us.
So instead, we begged a computer off Hirt and Carter in return for doing all our printing work through them.
It was a great move for both parties, as we ended up with a state-of-the-art Apple Mac that really impressed our clients, while Hirt and Carter got lots of work from us.
The rest of the operations were self-funded, which was not that difficult as we were in our mid-20s.
Our overheads and living expenses were low and our previous jobs did not pay that well.
I lived off my wife’s salary for a few months to make up for the shortfall in earnings, while Gareth was single and roughly earned R3 000 when he quit his job.
The first year was really tight, we did almost everything ourselves and had to learn a lot about running a business.
By the second year, however, we were netting about R1.5m in profit.
You and Gareth have been business partners for 20 years.How did that come about?
We were introduced as prospective business partners in a pub in Cape Town.
After a few minutes of small-talk, it emerged that Gareth was a really good surfer, which was kind of a deal breaker as I was a paddle skier and surfers traditionally look down on paddle skiers.
When I told Gareth I was a paddle skier, he started telling me this story of how he saved this “idiot boatman” who had wiped out into the harbour wall at Mouille Point.
He went into great detail about how he risked his life to save this man.
I could not believe the story – not because it was not true – but because I was the man that was saved and never heard the full story, as I only regained consciousness in hospital.
At that moment, we realised that it was our destiny to “face the stormy ocean of advertising together”.
How did you get your first clients?
Most of our clients were through word of mouth.
Our first job was to create a logo for the furniture company Full House, which heard of us through a friend of a friend.
We danced for joy when we received that first cheque of R850.
These days, we don’t sell any corporate identities for under R500 000.
One of our big breaks came when Kalahari.net gave us ten days to develop a TV advertisement.
We came up with this concept idea of Khoi San playing charades to describe famous movie names.
Kalahari.net loved the idea and we, with our limited experience, managed to put a pretty descent television campaign together in a very short space of time.
So it was smooth sailing from there?
No, we made a terrible mistake when we sold Joe Public to an American company in 2001.
I was attracted to the sale, because they offered to take our “take-away” advertising concept abroad, with offices in New York.
But the deal turned us into corporate boys and things went sour after the economy fell flat post-9/11.
Back in the South African office, we were really struggling to keep head above water, even more so when we were merged with another struggling company in Johannesburg.
During this time, the company also lost a client that was responsible for over 40% of our revenue (after one of our board members was fired and went to work for this client).
Over half our staff had to be retrenched to absorb the loss in revenue.
It took us three years of negotiations to buy the business back and by the time we got it back, it was bankrupt.
It was a terrible time for me, as everything was falling apart – from my business to my marriage.
What carried you through these hard times?
At this one point, I had to judge advertisements in a competition while feeling like a complete failure.
I woke up one morning, looked at myself in the mirror and for some unknown reason started doing positive self-talk.
I told myself out loud that I was okay.
I have been doing this ever since. It has really made a big difference in my life.
I have also started making huge lifestyle changes to try and become a more responsible world citizen and role model.
I have done lots of courses to try and improve myself and have turned into a teetotaller and vegan.
How has the company grown since you took it back?
At the time of buying our business back in 2009, our revenue was R11m, running at a net loss with 30 employees.
Last year, we had a turnover of R700m, gross profits of R218m and we have 287 people working for us.
We also have over 20 clients who share our values, ranging from AB InBev, Anglo American, De Beers, Mercedes-Benz and Shell to Chicken Licken, Nedbank and Clover.
How has your business strategy changed over the years?
We opened up a Joe Public with partners in Amsterdam around 2011 that still uses our original “take-away” model, with concept ideas selling for around €11 000 a piece.
In SA the model no longer worked for us, as we and our clients have grown.
Where we started out with relatively small clients, we were now serving bigger clients, who needed a new model to strategically maintain our high quality of work.
The shift resulted in a more client-centred approach, with more emphasis on understanding a client’s business and their clients, as the ultimate goal with advertising is to get people to connect with a specific brand.
This has resulted in a lot of soul searching for me personally, and for us as a company.
Our line of business over time has given me the opportunity to sit in boardrooms of over 20 of the greatest companies in the country.
I have learnt that a person or business needs to stand for something more than profit.
At Joe Public, we have identified growth as the main driver of our work – growth of our people, growth for our clients and work that contributes to a better SA.
So, if you look at our advertisements, you will see that they are primarily aimed at creating positive emotions and associations.
The problem with the world today is that people are approaching business upside down.
There is an unhealthy obsession with profits, resulting in a greater divide between the haves and the have-nots.
How has the company structure changed since the buy-back in 2009?
Joe Public has evolved from a single offering into a full-service, integrated group offering.
Our digitised above-the-line agency offers clients impactful, fully integrated creative solutions, while Joe Public Connect offers deep digital specialised solutions.
Joe Public Engage focuses on public relations, while Joe Public Shift is more focused on strategic brand building and design.
Joe Public Ignite is like a smaller version of the company as a whole, focusing on beyond-the-line advertising and innovation.
For Jet, for example, the division created a new product in the form of women’s shoes with messages inside for Mother’s Day.
Tell us about your School of Growth which was opened this year.
Besides our involvement at two under-resourced and disadvantaged township schools since 2007, we have created the School of Growth at the start of 2018.
Most educational programmes only focus on teaching IQ-based skills and impartation of knowledge.
Our focus is on producing well-rounded individuals through a more holistic learning approach. Courses have a strong focus on building emotional intelligence, spiritual intelligence and personal resilience.
The school is currently only open to our own staff, but will eventually be extended to graduates, clients and other industry individuals.
What do you see as the greatest challenge for you, and for the industry?
Companies have become extremely mediocre, basically only generating ideas to make money, instead of striving for something greater.
While we have established ourselves as industry leaders, I feel there is still a lot of scope to improve our creative product.
This article originally appeared in the 6 December edition of finweek. Buy and download the magazine here or subscribe to our newsletter here.
