Ad Age: Steak n Shake seeking new agency

Two years and at least two advertising agencies after ending a long-term advertising deal, Steak n Shake is reviewing pitches from agencies interested in its business, according to a report from industry publication Advertising Age.

The report, posted on adage.com this week, cited unnamed executives familiar with the review. Officials at Steak n Shake, the Indianapolis-based restaurant chain operating as a unit of Biglari Holdings Inc., did not return a call seeking comment.

Steak n Shake terminated an 18-year relationship with Indianapolis agency Young & Laramore in late 2008, after Texas investor Sardar Biglari took control of the parent company. That November, it signed a $4 million contract with The Varnson Group, a Georgia firm it fired less than three months later.

The two companies ended up in court after Steak n Shake accused Varnson of holding onto proprietary material following the split, but the case was closed in April 2010 following the advertising agency’s Chapter 7 bankruptcy filing.

Florida-based The Zimmerman Agency stepped into the breach—and still includes some Steak n Shake television commercials in its online portfolio—but Ad Age said no agency is working with the company now. A Zimmerman spokesman said the agency had no comment.

Steak n Shake, which has about 490 restaurants, has been increasing its ad spending in recent years, Ad Age said, citing statistics from WPP's Kantar Media. In 2009, the company spent $17 million, the publication said, up from $13.6 million in 2008 and $12.8 million in 2007.

In 2008, local industry experts pegged the Steak n Shake account as one of the top 10 in the state, estimating it generated a mid- to high-seven-figure sum for Young & Laramore each year.

Y&L's Steak n Shake TV ads became almost as iconic as the restaurant itself. Spots featuring sharp-tongued servers preparing hand-made hamburger patties and hand-dipped milkshakes won the ad agency myriad local and national awards.

CEO Paul Knapp said the local agency has not been invited to pursue the Steak n Shake account as part of the current review.