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The Selling Of Germany's Would-Be Chancellor


On May 30 a beaming Angela Merkel, chairman of Germany's center-right Christian Democratic Union, stood before TV cameras and several hundred cheering supporters at party headquarters in Berlin and declared: "I want to serve Germany." Less than an hour later, over lunch in a caf? across town, Thomas Heilmann could not suppress a smile as he listened to an account of how Merkel declared her candidacy for Chancellor.

Heilmann had good reason to be happy. The chief executive of Berlin ad agency Scholz & Friends, he was part of a small group of Merkel confidants who advised her on the speech, which also serves as a blueprint for her coming campaign against Social Democrat Gerhard Schr?der. While Heilmann eschews credit, sources close to Merkel say he argued in favor of the line about serving the nation. Merkel used the verb dienen, which suggests humility -- a sentiment unusual enough among German politicians that papers such as Munich's S?ddeutsche Zeitung used it as a headline.

Now, Heilmann's unpaid, unofficial work for Merkel is raising the profile of the hyperactive 40-year-old adman. He is already well-known inside Germany's marketing world for his role in making Scholz & Friends into one of the nation's top 10 agencies, with $636 million in 2004 billings and such clients as Siemens (SI) appliances, DaimlerChrysler (DCX) commercial vehicles, and French yogurt maker Danone.

It's a living. But now politics beckons. Merkel has a reputation for allowing only a few people into her inner circle, such as CDU General Secretary Volker Kauder and press secretary Eva Christiansen. Heilmann is among the few advisers from outside the party apparatus. (A CDU spokesman confirms that Merkel "values his advice.")

The two met in a way that Heilmann says was "typical Merkel." In 1998 she saw him criticize the Christian Democrats' national campaign strategy on a TV talk show. She called, and they spent several hours talking politics over lunch. Heilmann told her that politicians needed to focus their message more on voters and less on themselves. This was shortly after CDU Chancellor Helmut Kohl had been voted out after a campaign that seemed to revolve around his personal desire to remain in office. Willingness to seek advice outside the usual political circles is a Merkel hallmark, Heilmann says. "She is a very unusual politician."

Heilmann is careful to point out that he is not close personal friends with Merkel, who is known as something of a loner. Still, they met at length prior to her announcement. His access to her as she looks poised to become Chancellor highlights Heilmann's remarkable rise to Germany's top echelons. "He seems to be everywhere, and he is very well-connected," concedes a competitor. Not just with the CDU. Scholz & Friends also won a major contract from Schr?der's center-left government in January to produce an image campaign for Germany that will run next year as the nation hosts the soccer World Cup.

Like other agencies, Scholz has struggled with soft ad spending in recent years. But in 2004 it returned to the black, reporting profits of $3.5 million after a $2.4 million loss in 2003. Scholz won't make any money from Heilmann's work for Merkel, however, since the CDU ad account belongs to McCann Erickson Germany. Heilmann operates as a kind of freelance consultant, helping Merkel frame the issues at a difficult time in German history. The Social Democrats will try to persuade voters that Merkel will scrap job protections and sell out the nation to rapacious foreign investors. Merkel wants to convince voters that less regulation means more jobs. Hence her plea, which bears Heilmann's fingerprints, for less labor regulation to cut unemployment: "Jobs are only possible if there is growth, and growth is only possible if there is freedom."

Few observers have much doubt that Merkel will become Chancellor following elections tentatively scheduled for September. Schr?der has had no luck improving the economy, and Merkel's party has a commanding lead in the polls. The big question is whether she will have the courage to push through the labor deregulation and tax reform needed to spur growth. Heilmann does not quarrel with those who see Merkel as a moderate reformer, but adds, "She is very determined." If he's right, Germany could become an easier sell.

By Jack Ewing in Berlin


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