Cracks show as creative chief Roddy quits BBH New York

September 29, 2010

To lose one senior executive may be considered a misfortune, but to lose two begins to look like carelessness. Or, in the case of Kevin Roddy, chief creative officer of BBH New York, like an increasing inability to control a fast-unravelling situation.

Chairman Steve Harty was told to go, back in July. The surmise was that he had become too expensive a luxury in the wake of BBH’s sudden and unpredictable loss of the newly-won $270m Cadillac account.

Roddy on the other hand, who is well-respected and well-liked, has quit of his own volition. And clearly in uncomfortable circumstances, for John Hegarty – BBH’s creative doyen – has conceded that there were “disagreements” over the creative direction of the office – not the anodyne euphemism that routinely accompanies executive departures.

What these “disagreements” were is not entirely clear, although we may guess that lack of money  – and the constraint it is imposing on freewheeling creativity – was not entirely unrelated to the bust-up. It is known that a number of creative directors under Roddy have been discreetly looking around recently – testimony that the creative department has not been a happy working environment for some time. Roddy may well have been overstretched. After six years serving as chief creative officer, his duties were extended earlier this year to helping the new chief executive  – and former planner – Greg Anderson with the day-to-day running of the agency.

Interestingly, Roddy had this to say to Ad Age last week, before the storm broke: “Creativity used to be put on a pedestal, and I don’t think that’s the case any more. Creative people have become more of a commodity, and I think that takes the wind out of them. The creative ego is a very important thing, because it drives talent. But it’s also a very fragile thing.”

Like Harty, Roddy lent American credibility to what, in the opinion of critics, was too-British an operation. Roddy, however, is a much more serious loss.

Is Bolloré limbering up for a new tilt at Aegis?

September 28, 2010

Wouldn’t it be a shock if Vincent Bolloré, corporate raider, chairman of Havas and long-time would-be nemesis of Aegis, were finally to deliver his knock-out blow just when the media buying, digital and research group was least expecting it?

But he’d never do that would he, not now? Most informed commentators believe he missed his golden opportunity 18 months ago when Aegis had lost a third of its market value and was lurching rudderless after the incoming chairman, John Napier, fired group chief executive Robert Lerwill. Things are very different now, with Jerry Buhlman installed as ceo and actively engaged in an aggressive acquisitions policy that has successfully targeted Australian media buyer Mitchell Communications. The share price – an anaemic 75p 18 months ago – has now regained a lot of its former lustre, hovering around 123p.

So Bolloré, who owns 29.9% of Aegis, yet has failed five times to get two of his own directors on the board, would be mad to strike now – wouldn’t he? That’s certainly the impression he’s been cultivating with carefully placed interviews in France’s leading daily Le Figaro and the Financial Times. In the latter, the chairman and 33% owner of Havas tells us that the global advertising and media buying network is now poised to make a series of acquisitions but, he cautions: “It doesn’t mean we want to make one big shot but some different acquisitions in different countries.”

Really? What commentators seem to forget is that Havas itself was in no fit state to exploit Aegis’ weakness 18 months ago. It’s far better primed now, with up to €2bn (£1.7bn) in cash and loans available to it, and a much fitter share price to boot. Bolloré has close connections with Italy’s biggest publicly traded investment bank Mediobanca, of which he is a 5% shareholder.

Aegis is capitalised at about £1.47bn. A bid mixing Havas shares with substantial cash to sweeten Aegis’ extraordinarily loyal shareholders would be the way ahead.

Let’s see whether  – in the coming months – Bolloré has the courage to take it.

Arts Council prepares to give Tweedy’s business sponsorship body the heave-ho

September 28, 2010

Doyen of business sponsorship of the arts Colin Tweedy is in rueful mood these days, and for good reason. He’s waiting on tenterhooks to find out whether Arts & Business – the organisation he has built up over 27 years to champion commercial participation in the arts – has become the victim of a stitch-up hatched by his host body, the Arts Council.

The Arts Council, like every other quango, is under intense pressure to make deep cuts in its budget. And the suspicion is growing that, in order to save its own hide, it’s quite prepared to sacrifice A&B – which depends on the Arts Council for over half of its funding.

Naturally enough, that’s not going to be the way the proposal is presented to culture secretary Jeremy Hunt. The pitch is more like this: [Much wringing of hands] “…so, Secretary of State, unfortunate sacrifices have had to be made for the greater good of the arts community and we feel Colin’s organisation… well, it does receive quite a lot of private funding, and it’s about time it stood on its own two feet…” Or words to that effect.

Actually, it does receive quite a lot of public money – about £4m a year – which for obscure reasons is within the remit of the wholly subsidised Arts Council rather than being funded directly by the DCMS (the case before 1999 with the then Department of Heritage). Pulling the plug of public finance, however, would not be the best calculated method of ensuring it stood on its own two feet. In fact, quite the contrary. Much of the 45% private funding might disappear if it is not matched by a pledge of public money. And even if it did not, A&B would be crippled by the drastic restructuring that would have to take place to ensure some pale ghost of an afterlife.

It says a lot about the arts world that some would greet this outcome with ill-disguised glee. To them, commerce is a grubby word contaminating the purity of the artistic dialogue. And, let’s face it, Tweedy – tireless champion of commercial support of the arts over nearly three decades – has made a few enemies on this account along the way.

But he’s not without friends, either. And one of them is George Osborne, Chancellor of the Exchequer. It is a peculiar irony that Osborne, in whose name these swingeing cuts are being made, was – until his present elevation – a passionate advocate of the engagement of art with commerce. As you would expect, given he sat on the board of A&B.

Maybe the Arts Council should have a rethink. Not just because of Osborne either. The whole idea of doing away with our best-known and most successful arts sponsorship body seems daft, given that public subsidy of the arts is about to crater.

More about this in my magazine column this week.

How to Check unwanted ministerial intervention

September 27, 2010

Nothing is better calculated to bring marketers and marketing into bad odour with the young dads who now comprise our ministers of the crown than an assault on the sanctity of family values. Fairly or not, it is the main yardstick by which they judge the industry and the self-regulatory system governing it.

So, a big pat on the back for the Advertising Association for launching Check, which received the following forthright accolade from culture minister Ed Vaizey (left):

“Childhood should be free of excessive commercialisation and inappropriate content.  Fortunately the UK advertising industry has a good track record in taking its responsibilities seriously, and this industry-led initiative is further evidence of that.  Check will play an important role in ensuring advertisers and marketers continue to act responsibly when communicating with children and the Government fully supports this important work.”

So say all of us, of course; while remembering that every solid initiative like this – or for that matter the expansion of the Advertising Standards Authority’s remit to cover brand web site content – makes the likelihood of statutory intervention a more distant prospect.

What exactly is Check? The Children’s Ethical Communications Kit is a web site, launching tomorrow, that handily pools all the existing regulations governing marketing to, and communicating with, children. It has been built by the AA – the most broadly-based industry trade body – with the help of Turner Media Innovations.

As Ian Barber, director of communications at the AA, puts it: “Marketing and children is a hot topic and it’s good to see the industry keeping one step ahead.” Exactly so.

The Scourge of Capitalism gets ready to rig the media market

September 23, 2010

I was disappointed by our business secretary Vince Cable’s party conference harangue. As advertised, there was lots in it about the evils of capitalism. Short-termism, “irrationality”, “market rigging” “bankers’ greed”, “killing the competition”, yes aplenty  (though that last bit turned out to be a direct quotation from the father of market economics, Adam Smith). But, despite searching high and low, I could find no reference anywhere to Rupert Murdoch, his son James, News International or NewsCorp.

This was very dismaying, after I had been promised by those elements of the media not owned by R Murdoch esquire that Cable’s speech – its deeper purpose that is – was a veiled attack on the Murdoch empire and its evil designs on UK media plurality. Either this was a delusion, or the “veiled” bit was so profound as to be obscure.

Whatever, I hold Claire Enders, the eponymous founder of media consultancy Enders Analysis, partly responsible. Enders gave intellectual respectability to the idea that Cable should stop Murdoch in his tracks by suggesting, a couple of weeks ago, that NewsCorp’s bid for the 60.9% of BSkyB it did not already own was merely a rite of passage to the media mogul becoming a UK Silvio Berlusconi.

Perish the thought. As far as I know Murdoch does not use Viagra, and even if he did, I’m sure he would not be careless enough to be caught with his trousers down. On a more serious note, the parallel scarcely applies. As a global media power, Murdoch need take no lessons from Berlusconi, with or without the rest of BSkyB in his pocket. On a political level, it’s just a non-starter. James as an MP, working his way up to prime minister? Don’t make me laugh. The Berlusconi tag was, of course, just a rhetorical device designed to capture headlines – which it duly did – as pressure builds on Cable to refer the bid. In her letter to Cable, Enders laid out more precisely what she fears: “News International papers and BSkyB channels, particularly Sky News, may merge into one stream of fact and opinion. If this occured, plurality would decline…”. In other words, wall-to-wall Fox Television beckons.

There is, I’m afraid, little if any correspondence between the Murdoch vilified by Enders and the critique of capitalism contained in Vince the rabble-rouser’s party speech. In fact, quite the opposite. No one can accuse a man who has been investing in Sky Television since 1989, and who bailed out – at the government’s behest – British Satellite Broadcasting in 1990 – as “short-termist”. And if – to use Cable-speak – this particular market is “rigged”, it’s because politicians and regulators do the rigging. The Murdoch clan welcome free competition: it would be, as the history of Sky shows, their opportunity to clean up.

Precisely to “rig” the media market still further Cable the business secretary  – as opposed to Cable the party orator – will feel compelled to refer the Sky bid to the Office of Fair Trading (once, of course, he has availed himself of the opinion of media regulator Ofcom). An inquiry by the European Commission – which is part of due process – would almost certainly not be enough to block it: the terms of reference would merely encompass the narrow lines of competition law. Time, then, to introduce a bit of “irrationality” and “rigging” into the workings of capitalism in order to achieve the desired outcome. And what better than a referral on the nebulous grounds of “public interest”, citing a threat to “media plurality”? Once the OFT has done its job, and passed the matter on to the Competition Commission, we can look forward to at least a year of obfuscation and procrastination as the regulatory authorities painfully crawl towards their negative verdict.

Kindle’s bright idea incenses Apple iPad fans

September 20, 2010

Kindle’s latest pitch to a UK audience is very weak. Two people sitting on a beach, marvelling at how easy it is to use the Amazon-inspired e-reader in bright sunlight: who in their right minds would be doing such a thing anywhere near sand?

Berlin Cameron is capable of much better work, and the stuff currently airing in the US is a good case in point. The USP is similiar to that of the UK ad, but what a world of difference in execution.

‘Poolside Girl’ has, in just a few days, created a sensation on YouTube – with closing on 2 million hits – and managed to stir up tribal hatred among the many adherents of the rival Apple iPad in the process. Which can have done Kindle sales no harm at all.

How so? Let’s set the scene a little. The scripting is economy itself. Two holiday-makers are lying side by side next to a ritzy swimming pool. The bloke, so quaintly clean-cut he must have been remaindered from the Mad Men cast, is struggling with his cumbersome e-reader (it’s clearly an iPad, though no one says that) in the bright sunlight. He leans over to the bikini-clad girl next door – effortlessly devouring her book with a gizmo less than half the iPad’s size held in one hand – and asks her what it is. “A Kindle” comes the smug reply as she lifts her fashionista sunglasses and gives him a pitying smile. “$139. I actually paid more for these sunglasses.” Sub-text: ’What a schmuck. Fancy spending $500 on that piece of overrated junk.’

That’s it really. All the salient product advantages put across in just a few pithy words. The Kindle works in bright sunlight, unlike the iPad. It’s light to handle: you can hold it with just one hand. Oh yes, and it’s about a quarter of the price.

We could, of course, unpack all this quite easily by asking what else the Kindle can do for its $139. Not a lot compared with the iPad and its multitudinous apps. It doesn’t offer colour. Nor, for that matter, are we likely to do much reading by the poolside. I don’t know about you, but I do most of my reading indoors – where the iPad suffers no such disadvantage.

But that would be picky. Hats off to an audacious knocking ad – which appears to have been the personal inspiration of Amazon founder Jeff Bezos – especially when the target is as iconic as Apple. For more on this topic, look up Jim Edwards at BNET.

Dentsu launches $600m bid for AKQA

September 16, 2010

Word reaches me that Dentsu, Japan’s largest advertising network, has launched a pre-emptive $600m bid for digital independent AKQA.

No discourtesy to AKQA – which is well-respected  – but that sounds an awful lot of money  – even for an agency that is renowned for setting an impossible price on its independence. And it is: twice as much as it is worth gauged by conventional financial metrics. But then, Dentsu is desperate to buy digital presence in the West – and the USA in particular – at almost any price. And AKQA, which boasts an enviable blue-chip client list including McDonald’s, Coca-Cola, Unilever, Nike, Visa and Fiat, is one of a fast-shrinking number of desirable targets.

Readers of this blog will recall Dentsu’s bitter duel with its supposed ally Publicis Groupe to acquire Razorfish last year. Publicis eventually trumped Dentsu, which had offered an extraordinary $700m, with a lower bid of $530m; but then Publicis had an inside track with the owner, Microsoft, involving a favourable ad deal.

Dentsu eventually scored when its US unit acquired Innovation Interactive, the parent of digital ad shop 360i, at the beginning of the year. It also had its sights on search and social media specialist iCrossing, but that was snapped up at the beginning of the summer by the Hearst Corporation.

AKQA – founded in 1995 by Ajaz Ahmed, who remains its chairman – is a much bigger prize. Headquartered in San Francisco, it has outposts in London, New York, Washington DC, Shanghai, Berlin and Amsterdam; and employs over 800 people.

I’m told that Ahmed and chief executive Tom Bedecarré are against selling out to Dentsu. But the inconvenient truth is that their company has been majority-owned by private equity group General Atlantic for the past three years. GA calls the shots, and cannot ignore such a salivating offer…

I’ll keep you posted.

UPDATE, September 23rd: WPP bidding for AKQA, eh? Not at that price it won’t be. The rumour was described by sources close to WPP as “rubbish”. To prove the point, Campaign and Media Week – which gave credence to the story – have withdrawn it.

%d bloggers like this: