Burson-Marsteller: How It Began
Established in 1953, Burson-Marsteller has its roots in a one-employee business started by Harold Burson in 1946. Operating as Harold Burson Public Relations in office space provided by one of his two clients, he marketed himself as a business-to-business specialist based on his pre-military three-year association with a large engineer-builder (which became his first client). By 1952, his firm had a dozen clients and five employees, including Elias (Buck) Buchwald, who retired 50 years later after serving as Burson-Marsteller's No. 2 executive for much of that time.
Harold Burson Public Relations evolved into Burson-Marsteller following a telephone call from a Burson friend at The New York Times in February 1952. It was a new business referral to a Chicago advertising agency whose client, Rockwell Manufacturing Company, was looking to hire a public relations firm. The person to call was Bill Marsteller, whose ad agency was then known as Marsteller Gebhardt & Reed.
Burson informed Bill Marsteller that, by chance, he would be in Chicago the following week on a client matter. They met on a day when a 10-inch snow forced cancellation of their remaining appointments and spent the day with one another. In their extended discussion, they learned that their career paths had many parallels. Both earned college expenses writing for their local newspaper – Harold for the Memphis Commercial Appeal, Bill for the Champaign, Ill., News-Gazette. Both considered themselves competent writers; both specialized in industrial clients (b-to-b). And both shared the same work ethic: a commitment to excellence in client service. The meeting ended with a telephone call to Rockwell corporate headquarters in Pittsburgh to set up a meeting with CEO W. F. Rockwell Jr.
The assignment called for publicizing a helicopter Rockwell bought to facilitate visits by senior executives to manufacturing plants within a 300-mile radius of the company's home base. (The Interstate Highway System was still on the drawing board and the mountainous terrain in southeast Pennsylvania discouraged frequent travel by car.) Since this would be the first helicopter fully dedicated to executive travel, Burson agreed with CEO Rockwell that it was newsworthy. In quick order, Burson's small firm was hired with compensation to be on a time input basis at $150/hour – then entirely respectable remuneration.
Rockwell Manufacturing, though publicly owned, in reality, was a family enterprise founded 25 years earlier by the father of the present CEO. It was therefore natural for Mr. Rockwell Jr. to suggest starting the assignment with in depth discussions with his eight to ten principal executives. In effect, the mission was two fold: to explain the role of public relations in the current business environment (Rockwell had no public relations department) and to gain an understanding of the company and its products (even though this had little to do with Burson's specific assignment).
Burson realized rather quickly that his client's expectations for widespread national news coverage on using a helicopter as a management tool was most likely beyond reach. A LIFE magazine cover was mentioned frequently by the client as well as newsreel coverage (television was not yet a household staple) and, of course, a major article in The New York Times. At about the time Burson was ready to suggest to Bill Marsteller that his client's expectations may be unrealistic, Sikorsky, the helicopter manufacturer, informed Rockwell that delivery would be delayed a year due to Korean War priorities.
This was both good news and bad news for Burson. It prolonged the day of reckoning. At the same time, it would reduce what had become a solid source of income – he was paid only when he worked on the helicopter project. However, the many hours he spent meeting with diverse Rockwell executives learning the business paid off, he knew that the firm's Delta Power Tool Division planned to introduce a new advanced home workshop power tool. CEO Rockwell acceded to his suggestion that he publicize the new home workshop.
The 1952 Thanksgiving issue of LIFE magazine – at the time the nation's most impactful medium – devoted two pages to the new DeltaShop. In 10 days, they were sold out and Rockwell's plant in Tupelo, MS, added a second shift. The product was a smash success, an achievement Rockwell management recognized Burson with a luncheon in Pittsburgh that ended with his firm being hired at $3000/month (an acceptable fee at the time).
Concurrently, Bill Marsteller introduced Burson to George Spatta, CEO of Clark Equipment Company, the world's premier manufacturer of fork lift trucks. Burson and Spatta quickly developed a close relationship that resulted in another new client for the Burson firm – this time at $4000/month. With Rockwell, this represented some 60 percent of Burson's revenue – yet neither Burson nor Marsteller had ever discussed a financial arrangement between their two companies.
Burson proposed such a discussion that took place over breakfast at the Plaza Hotel in New York the first Saturday in 1953. The result was the creation of a new public relations firm jointly-owned by the Marsteller agency and Harold Burson. Legend has it that Burson's name was put before the hyphen in exchange for Burson's agreeing to the Marsteller agency ownership of 51 percent of the stock. Burson maintained there was never any doubt as to whose name would be first. In 1983, Burson-Marsteller became the world's largest public relations firm.