Rick Hirst in Campaign: The media makers
The high number of media agencies with new leaders from different backgrounds is emblematic of an industry in flux. Campaign spoke with six of them -including Carat UK chief executive, Rick Hirst- about the challenges they face in this changing climate.
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Media agencies are changing. They are pushing the boundaries further, using technology for the better and improving their business models.
Over the past year, many of them have transformed in the same way: by hiring as their leader an executive who has never run a media agency before. Campaign caught up with the new generation to find out why there has been so much change.
Carat chief executive Rick Hirst, who moved over from sister creative agency mcgarrybowen in July 2016, believes the raft of new leaders shows that media agencies are able to respond to market changes. "It’s symptomatic that we’re about to have another pivot in our business," he explains.
"If the media industry is really good at something, it’s about anticipating change. That’s why there are different people now as leaders from such different backgrounds. What our clients want from us is evolving."
Hirst says that media agencies need to be "brave and radical". He adds: "It’s about us being on the front foot, which is something media businesses are better at than creative agency businesses."
The relationship between creative and media continues to be hotly debated, with an increasing number of clients choosing to house the disciplines under one roof. Carat was on the losing side of one such move three months before Hirst arrived, when Asda moved its £110m media into Publicis Groupe’s Blue 449 at the same time as appointing sister shop Saatchi & Saatchi to the creative account.
Hirst’s move to Carat also highlighted a blurring of the boundaries. He says that his job isn’t to work on the nitty-gritty of a media business but to take a wider look at the operation.
"I need to work out how to [reinvigorate Carat’s] sense of purpose and refocus that business around proper world-class client leadership, which I think are some of the hallmarks of the other side of the businesses that I’ve worked on before," Hirst says.
Creative and media coming together is just one part of the jigsaw. Over the past 12 months, the industry has had to contend with Facebook and Google’s increasing dominance, defend itself against non-transparency claims and adapt to new client needs – not to mention seismic political changes. That’s a lot of disruption to deal with.
"What a leader needs to be now is quite different to what it used to be," Matt Adams, chief executive of Havas Media UK, explains.
He believes the new media leaders gathered at Soho’s Century Club to talk to Campaign are "hybrid" in terms of their backgrounds. "Everyone has a different superhero power that they bring," he says.
This new wave of hybrid leaders with two or three different specialisms are able to take staff on a journey to broaden their experience, Adams says.
But even if the media agency model is under scrutiny, things perhaps could be worse. "I’ve come from a creative business where the financial model is fundamentally broken," Hirst says.
"Media agencies are much better at being commercial but, until we genuinely change the model, I think [there will always be doubts about whether] we are making the right choices on behalf of the client."
With the recent launch of agencies Blackwood Seven and Bountiful Cow, there is yet more competition for media leaders to contend with. But the media agency bosses agree that this can only be a good thing.
"It has to push us faster, to be more agile, work in sprints not cycles, [make better use of] tech and [come up with] better ways of working," Adams explains. "New entrants to the marketplace should make everyone better, and ultimately lift them up and help support and challenge."
Hirst, however, is more sceptical about Blackwood Seven, which claims to use artificial intelligence and automation to deliver media-neutral planning. He questions whether the model is "deliverable when you take into account the governance around certain aspects of offline media".
Independent agencies like to position themselves as better places to work and, with no stakeholders to answer to, can benefit from greater flexibility. But Jem Lloyd-Williams, managing director at Vizeum, believes that holding companies can foster a similar vibe.
"It’s up to the leader of a business in a federal matrix to wriggle and find their own independence from what might be perceived on the outside as a hugely bureaucratic way of doing something," Lloyd-Williams continues.
"If you present a business case to your holding company saying ‘I can deliver X growth by doing this with these tools’ and it’s a properly thought-out business case instead of just ‘we’ve got to win some new business’; if you can be compelling enough, then you get support."
No strategy is complete without a plan to deal with the power of Facebook and Google. Campaign decided not to name Facebook its Medium of the Year at the end of 2016 because, despite the network’s growth as an advertising platform, its lack of transparency, viewing-metric scandals and dissemination of "fake news" could not be ignored.
Adams says the lack of third-party-verification for Facebook and Google metrics is "becoming more and more of an issue". Now media agencies are planning across devices with higher addressability and navigating increased fragmentation, it is more important to see entire customer journeys because "that’s where you drive efficiency and effectiveness", he adds.
As last year ended, Google called on agencies and brands to use YouTube as part of their above-the-line strategies at its Brandcast event in a noticeable shift from its more combative tone in previous statements. And agencies appear to be in a conciliatory mood too.
Rachel Forde, chief executive of Mediavest, believes the digital giants have realised that they need to work with agencies. "We are now at a level where everyone realises that we’ve all got the same objective to grow client business," she says.
Elliot Parkus, managing director at Arena Media, adds that it’s the job of an agency to explain which is the right channel for a brand or campaign and so it needs to play "properly with the other people in this space". He says: "We are all here at the behest of clients to grow their business and to do it in the best way. We’ve had to understand it’s not a land grab any more; it’s not about telling clients ‘don’t spend your money with Google’ or ‘move your money into another medium that may or may not work for you but works for us’. It’s doing the best job for the client."
After a conversation dominated by the platforms, Lloyd-Williams says there is too much focus being put on digital players over traditional ones such as ITV and Sky. "The majority of proven growth from communicating comes from parties like Sky, ITV and Channel 4. Clients really want to hear what they want to say because of their cheap vertical experience," he says.
Despite the challenges they face moving their businesses forward, the new generation of leaders appear ready to embrace them and take their agencies through that transformation.
"We’ll be working with our clients to create a new space with them, changing organisation structure, our products and services, our way of working," Amanda Morrissey, UK chief executive of Publicis Media, says. "We’re in proper transformation now, and I think it hurts, is painful, is messy and takes time.
"We have to be engineers and we have to properly face the transformation that our predecessors didn’t have to do."
"We’re inventors as well because our world didn’t exist six months ago. We’re inventing a new world but it has to be designed for clients because, if it’s designed for the media industry, it’ll never survive."
THIS ARTICLE FIRST APPEARED IN CAMPAIGN ON 02/02/17