"We're still the pirates. We're not the Navy."
Jay Chiat speaking to Chiat/Day employees. (p.296)

Chiat merged his agency with Guy Day’s in 1968 over hot dogs at a Los Angeles Dodgers game. Almost overnight, the work produced by the Southern Californians became famous for being brash, irreverent, disarming and novel. Some of their first clients included the then unknown Honda, Pacific Northwest Bell, MGA Televisions and Pioneer Electronics. (Coyne, et. al. 1975, p. 166.) Jay Chiat and Guy Day worked side by side as Creative Directors, overseeing the brightest young art directors and copywriters on the West Coast. The agency quickly developed into one of the nation’s premier creative "boutiques," a name reserved for those agencies whose creative work is unparalleled, but whose size is limited. In the 1975 Communication Arts Annual, a prestigious annual devoted to the best advertisements of the previous 12 months, Chiat/Day’s work appeared 13 times. No other agency in America had as much work published in that year’s annual. (p. 188.) It was quite an achievement for an agency that was only seven years old.

Chiat/Day developed an interesting relationship with its clients, promising to take commissions only if the client's sales were improved. (p. 166.) It was part of Jay Chiat’s novel approach to getting new business. When he had opened his first agency, he literally went knocking on the doors of real estate and high technology companies looking for work. (Dougherty, 1981, p. D15.) In the 1970’s, Chiat/Day ran full-page advertisements in trade publications specifically targeting specific industries. One ad’s headline read, "Chiat/Day is airsick." The copy went on to explain how sick the agency was that it didn’t have an airline among its many clients. "They’ve done an incredible job of merchandising themselves," commented John Littlewood of NW Ayer in 1988. "They’ve paid as much attention to selling Chiat/Day as the products they’re hired to market." (Mitchell, 1999, p. 10.)

Chiat was by far the dominating figure among the founders. Guy Day was more than happy with the success that Chiat/Day enjoyed in the 1970’s. However, Chiat was unsatisfied and always sought to push the agency further. Another of his famous sayings was, "How big can we get before we get bad?" He almost didn’t get a chance to find out. In 1975, Honda outgrew the small agency and took its account to a larger firm. The loss almost destroyed Chiat/Day who had just lost three fourths of its income. Soon another blow was dealt to the young agency. Following the loss of the Honda account, Guy Day announced that he would be leaving as well. Jay Chiat was left alone, forced to slowly rebuild Chiat/Day for the rest of the 1970’s. (p. 10.)

Interestingly, the loss of the Honda account crystallized for Jay Chiat the fact that he had finally become successful. As he explained in 1988, "I realized we were still in business and that we were going to be in business next Thursday." (p. 10.) It was a powerful moment for a man whose passion for success was almost all-consuming. Chiat spent the rest of the decade firming up the agency's roster of clients and maintaining the shop's tradition of creative excellence.

It was during these years that Chiat developed a close relationship with the young art director Lee Clow, a brilliant and out-of-the-ordinary man whose work was already being recognized as some of the best in the industry. It was this relationship that would define Chiat/Day in the 1980’s; as they went on to become Advertising Age’s Agency of the Decade.