Agency Management – Echoes of the Past
19 October 2017
Disclosure – I have done work in the past for the7stars, mentioned here
Last week’s Cog Blog noted that out of the six major holding companies, the UK heads of three of them (Havas, Starcom, Carat) along with the EMEA President of OMD have all announced their departures.
People leave their jobs for all sorts of reasons, of course, and no-one is suggesting some sort of weird collaboration designed to undermine the entire holding company sector, but you have to admit it is unusual for four such senior figures to leave at pretty well the same time.
Gideon Spanier, in a ‘Campaign’ article argued that agencies need to change, that change needs leadership, and that leadership seems to be in short supply.
There is an echo of the old days when media agencies were but a twinkle in a few eyes. Back then, full-service agency media directors left their comfortable, well-paid roles to set up what were then called media independents. People like Chris Ingram (of CIA, now MEC); David Reich and Ray Kelly (TMD, later Carat); Alan Rich (The Media Business later MediaCom) and several others all took a huge risk.
Their reasons were primarily to do with the lack of respect full-service managements had for their positions, and the fact that they weren’t as fully involved as they might have been in decisions on the agency’s direction of travel. Within any full-service agency, media delivered the majority of revenue, whilst accounting for a below-average share of costs. Media was truly ‘below stairs’.
This of course changed dramatically as a result of the risks taken by the people mentioned above. Others (like Nick Manning and Colin Gottlieb, Jonathan Durden, David Pattison, and Nick Horswill) formed a successful second wave, which with the agency-owned operations like Zenith led us to the dynamic sector we’re all familiar with.
The business was led by true risk-takers and entrepreneurs.
But look around today’s industry (even before the purge of last week). I wouldn’t claim to know Pippa Glucklich, Nikki Mendonca, Tracey de Groose, or Paul Frampton well although no doubt all are strong leaders. All sit within large organisations over which they have perhaps less influence than they would like.
All appear to be client-facing by nature, professionals who put their clients first and central. They must find it hard to observe client trust in their organisations being eroded. Public criticism of their agencies’ lack of transparency must grate.
The truth is that as an opco leader in one geography their ability to influence their holding companies is limited.
Their positions are analogous to the old media heads of full-service agencies. Lacking ultimate influence over their companies’ behaviours; delivering the money to shore up other less financially successful elements of the holding group; frustrated at not being able to do what they feel is right.
To take one example, the holding companies have as one dismissed ISBA’s media agency contract framework as ‘unhelpful’. Let’s say, hypothetically that one of Frampton, de Groose or Glucklich were in favour of working with ISBA (as well they might be given that those responsible for the UK Government’s media review (in which de Groose’s Aegis is incumbent) are planning on using the ISBA framework). Would Havas, Dentsu Aegis, or Publicis be prepared to give ground in what some seem to think is a holy war against advertiser trade bodies?
The successors to the Ingrams and the Kellys, the Pattisons and the Durdens are to be found in the7stars, or at Goodstuff (who bought themselves out from Omnicom). These people (Jenny Biggam, Mark Jarvis, Andrew Stephens et al) took a risk – a big risk when they left their previous far larger organisations. They’re the successful ones; others have tried and failed. It wouldn’t be much of a risk if it was easy.
I think it unlikely that Frampton, Glucklich, de Groose and others still to come will reappear in another holding company. Aside from Nikki Mendonca who’s going to Accenture I suspect they’ll be more likely to give it a go on their own, or at the very least to pick an organisation in which they’ll have a greater degree of autonomy.
In the 1970’s we had media independents, who reshaped the industry.
It can’t be a lot of fun in the large network agencies at the moment. I suspect we’re about to enter a golden age of independent media agencies.