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Richard Pinder launches global network with Maserati as a client

March 26, 2013

Richard PinderAfter years of being a jet-setting senior suit in someone else’s service, Richard Pinder has decided to go global on his own account with the ambitious launch of international network The House Worldwide.

Pinder, it will be recalled, was head of Publicis Worldwide for five years until group succession politics (the imposition of Jean-Yves Naouri as executive chairman) made further tenure of his position unrealistic.

That was two years ago. Since then, Pinder has been pondering how to cash in on his experience with global clients (he’s worked for over 25 years in Asia, Europe and the USA; for Leo Burnett, Ogilvy & Mather and Grey, as well as Publicis) by building a new-model worldwide agency network.

No mean cliché, the cynic will object. We’ve heard the rhetoric before. What’s the reality?

It’s true that the agency world has long been struggling with a “post-analogue” structural solution to the increasingly financially unviable traditional creative agency network, with its army of regional bureaucracies. Some have proffered a solution in the form of the fleeter-footed international micro-network (step forward BBH, Wieden & Kennedy and – in its heyday – StrawberryFrog.

Pinder, however, has gone a step further in presenting a top-down managerial solution – or perhaps that should be management consultancy solution – in place of the piecemeal creative one. His starting point is that the traditional global advertising business – unlike professional counterparts such as lawyers and accountants – loses most of its senior talent to the management of regional geographic fiefdoms, which are there primarily because of historical legacy. What this talent should be doing is servicing the client’s agenda rather than their own corporate one. The exception, where the client really can insist on top-level personal service, is a vanishingly small number of mega-clients, such as Ford and Procter & Gamble, which have specially structured teams to pander to their requirements.

Pinder’s idea is to provide this level of service for global, or at least international, clients further down the budgetary league table. Each client should be serviced by no less than three senior people at any one time. To do this, he has joined forces with a core team of like-minded senior executives: initially, Peter Rawlings, former chief operating officer DDB Asia, Chris Chard, former chief strategy officer of Lowe Worldwide in New York and Ben Stobart, former senior vice-president (chief suit) of Burnett Chicago. These will deal directly with top clients on a day-to-day basis; the specialist skills base, on the other hand, is to be provided by a network of over a dozen associated network companies, of which the best known is Naked Communications (see AdWeek for a full list).

Note the absence of an overall chief creative officer. This is deliberate: Pinder does not believe a single individual can adequately address the creative needs of all client types.

Why is Pinder convinced this model can operate from a single fixed geographical location (well, actually two in THW’s case – London and Singapore)?  Because of consolidation on the brand management side. More and more marketing power is being concentrated into the hands of Chief marketing officers and indeed chief executives; less and less being delegated to regional and country power bases.

But, the acid test is: has Pinder got any clients? Yes he has. He has been collaborating with two over the past year in honing the organisational structure of THW, during what he calls “beta mode” (how digitally au courant).

And they are? Maserati and an upmarket specialist haircare brand, GHD (stands for “Good Hair Day”). Both, he tells me, are poised at an interesting fulcrum of development, from the brand and new product point of view.

Maserati, an ultra luxury sports car marque lodged in the Chrysler/Fiat stable, has been given a €1.6bn injection to broaden its model range and take on Porsche.

GHD – which produces premium-priced hair stylers – is also cash-rich after being bought for £300m by Lion Capital. Lion is investing in npd, with a view to bringing GHD out of the salon and onto the international stage. Inevitably, that is going to involve careful brand positioning as GHD moves into a broader market segment.

However, Pinder is coy on the subject of who, apart from Maserati and GHD, is bankrolling all of this. It seems likely that both principal founders (Pinder and Rawlings) have skin in the game. But a project of this scope is financially beyond most individual investors, even if they are relatively wealthy admen. Private equity seems to the answer. Among the list of network associates is, rather intriguingly, a UK-based hedge fund called Toscafund, whose chairman is former RBS bigwig Sir George Mathewson. Pinder claims Toscafund is very handy on the “analytics” side. No doubt. But my guess is it’s providing a lot more resource than that.

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Max, Dan, Jerry – 2012’s out-performers

December 14, 2012

League tables of achievement are as commonplace as turkeys right now. Why burden you with another one? Well, I’ve been asked to – by the good folk at More About Advertising. So:

Ad of the Year. Yes, I liked BBH’s “The 3 Little Pigs” and Creative Artist Agency’s Cannes Chipotle winner. Also, Del Campo Nazca Saatchi & Saatchi’s work for – of all improbable B2C clients – air-conditioning specialist BGH. Of which this, directed by Juan Cabral, is the latest instance:

As MAA’s Stephen Foster puts it – “bleakly comic”.

My favourite, though, was “Follow the Frog”, a quirky satire of the desk-bound yuppie eco-warrior fantasising about making the World A Better Place. Writer, director, copywriter, art director is Max Joseph – clearly a bit of an Orson Welles in the making. The commercial was produced by Wander Films, a creative boutique in Los Angeles. The moral? You don’t need to go to the ends of the earth to save the rainforest. Just Follow the Frog by buying kitemark-certified Rainforest Alliance products. They’ll do all the ethical heavy-lifting for you: sustain the forests, uphold socially equitable farming methods, and guarantee that what you buy is economically viable:

It’s long – but isn’t nearly everything these days? The measure of the made-for-internet film is not its length, but how well it sustains our interest. On this criterion Follow the Frog succeeds very well. It’s got a good tale to tell, is directed with panache and enlivened by bold use of graphics. Oh, and it uses gentle humour to camouflage the piety of its evangelical message. Yes “Siri”, it get’s my vote.

Agency of the Year. I won’t beat about the bush: it’s got to be Wieden & Kennedy. International networks frequently produce isolated instances of brilliance (Del Campo being an example within the Saatchi organisation). Exceptional work, simultaneously executed on a number of fronts, is another matter. To take an investment analogy, W&K is a momentum stock outperforming in all its main markets. Whether that’s Clint fronting for Chrysler at the Super Bowl:

… London winning the £110m Tesco account – but also producing some of the most interesting creative work since “Grrr”:

Or Amsterdam’s slick spoof for the latest James Bond film, which neatly segues into its current Heineken campaign:

Person of the Year. Tempting to mention the name of Joel Ewanick, isn’t it? No one can be said to have made a bigger splash in the world of marketing over the past year. Arguably, however, the now-dismissed chief marketing officer of General Motors made headlines for all the wrong reasons. A change agent he certainly was, but were any of his changes for the good? And what sort of permanence will they have? We hacks miss him, but I suspect the wider marketing community will not.

Jerry BuhlmannInstead of anti-hero, therefore, I’ve plumped for a gritty go-getter: marketing services’ answer to Daniel Craig. Like Craig, he certainly wouldn’t be everyone’s first choice as the archetypal smooth operator. But his coolness under fire cannot be doubted. Step forward Jerry Buhlmann, chief executive of Aegis Group plc. If there is one thing archetypal about Jerry, it’s that he’s a self-made media man. He started off in the “five to one” slot, in other words the lowest of the low in the full-service agency hierarchy, at Young & Rubicam in 1980. Nine years later, he was setting up his his own media-buying outfit BBJ – along with ultimately less successful Nick Brien and the downright obscure Colin Jelfs. BBJ – nowadays Vizeum – though successful (it handled for example the BMW account) was originally a “second-string” shop for conflicted WCRS media. Buhlmann’s career really took off when WCRS’s Peter Scott had the inspired idea of acquiring Carat – Europe’s largest media buyer – and floating off the combined operation as a separate stock market entity, rechristened Aegis. Buhlmann and his company were soon swallowed up by the independent media specialist, which offered him much wider career opportunities.

But was he a man capable of capitalising on them? While no one has ever doubted Buhlmann’s single-minded ambition to succeed, a lot have wondered whether he had the competence to do so. Yes, he had a mind like a calculator and razor-sharp commercial acumen, but where, oh where, were those human skills no less essential for making it to the top of the corporate pile? There was much mirth in the senior reaches of the media industry when Buhlmann got his first big break as head of Aegis Media EMEA in 2003. “It’s like William Hague trying to emulate Margaret Thatcher” was a typical response to his promotion. Then, as later, Buhlmann’s critics completely underestimated his ability to learn on the job. When he became group chief executive in 2010, the reception was scarcely less friendly. The master of ‘focus’ and ‘detail’ was incapable of taking the broader view vital to successfully running a publicly-quoted company, it was said. And then there was Jerry’s far-from-diplomatic demeanour: how long before he rubbed the City up the wrong way and had to be dispensed with?

It wasn’t as if Aegis was an easy company to run, either. As a (near) pure-bred media specialist, it was susceptible to squalls in the media every time the inevitable financial scandal broke. Inevitable, because media buying and peculation are bedfellows and peculation distorts financial performance – meaning in Aegis’ case it had to resort to highly public mea culpas every now and then. Other major media outfits, by contrast, have been able to rely on defence in depth from the much bigger marketing services organisations to which they belong.

Not only that, Aegis’s card was marked as a public company. For years, it laboured under the strain of being a takeover or break-up target. The strain became nightmarish when Vincent Bolloré, the shareholder from hell, took a strategic stake in Aegis and began engineering a series of boardroom coups.

Some of the credit for Aegis’ eventual soft-landing – a 50%-premium, £3.2bn cash deal with Dentsu, sealed last June  – must go to Aegis chairman John Napier. But that still leaves a lot owing to Buhlmann himself. Not only did he keep all the plates spinning in difficult circumstances, he also demonstrated a strategic clarity which eluded his predecessors. He ruthlessly pruned the company of its lower-margin research operation (by disposing of Synovate to Ipsos), but at the same time bolstered its pure-play media-buying profile with the geographical add-on of Mitchell Communications.

Not a bad result, all in all, for the man once dubbed the king of the second-string.


Would you put this orange muppet in charge of your brand?

March 25, 2011

How edgy should your social media strategy be? Bland and corporate is bad: no one looks at the viral or reads the tweets. But step over the line and you become a social laughing stock, shortly before your agency becomes redundant.

Readers will recall the notorious case of Coca-Cola and the Dr Pepper pornographic movie episode on Facebook (it’s here if you don’t). Which proved disastrous for its social media agency, Lean Mean Fighting Machine (sacked ignominiously from the Coke Zero account as well as Dr Pepper).

More recently, the risks have been highlighted by a couple of episodes over at Motown. Chrysler sacked its social media agency, New Media Strategies, after one of its employees “inadvertently” tweeted from the @ChryslerAutos account: “I find it ironic that Detroit is known as the #motorcity and yet no one here knows how to fucking drive.”  It seems pretty rough justice at first sight: agency and employee victims of hypocritical puritanism. By way of explanation, Chrysler Communications staffer Ed Garsten noted shortly afterwards: “The tweet denigrated drivers in Detroit and used the fully spelled-out F-word. It was obviously meant to be posted on the person’s personal Twitter account, and not the Chrysler Brand account where it appeared. So why were we so sensitive? That commercial featuring the Chrysler 200, Eminem and the City of Detroit wasn’t just an act of salesmanship. This company is committed to promoting Detroit and its hard-working people.” That bad, eh?

How interesting, then, that Ford should put a lecherous, politically incorrect puppet, suffering from attention deficit hyperactivity disorder, behind the steering wheel of its Ford Focus US launch. Admittedly Doug – a kind of Kermit with jaundice – hasn’t used the F-word (at least, not yet) or denigrated the good people of Detroit. But he does spend a good deal of his time making a mockery of stuffy Ford executives, and doesn’t have much regard for any social conventions. So far, he’s steered the right side of edgy, “post-modern” humour (though I wonder how many of the people who like the virals would ever buy a new Focus – it’s a $17,000 car, for God’s sake, not a pair of jeans). But he’s definitely a loose cannon. How long before Doug overdoes it and simply becomes a tiresome distraction? The ultimate star, after all, is always the product.


US admen cash in on the Brit-bashing act

July 20, 2010

Anti-British sentiment is now a viral contagion in the USA, thanks to BP and that liddle ol’blowout in the Gulf of Mexico.

Obama has recently cooled the rhetoric, presumably after someone pointed out to him that half  BP’s shareholders are American (must be a few US pensions in there as well). But that has not quelled the ardour of less sophisticated state governors with only one object in mind – re-election in November. Florida governor Charlie Crist (who is seeking election to the Senate, so the stakes are even higher) recently had to be put in his place, firmly but politely, when he came back for another sting, this time for $50m. Allegedly to support a tourism campaign in a state which has, as yet, barely suffered. BP had already coughed up $25m.

Hell, BP’s even responsible for letting convicted Lockerbie killer Abdelbaset Ali Mohmed Al Megrahi off the hook. Many American victims of the bombing believe, rightly or wrongly, that it was only due to some grubby oil deal struck by BP in Libya – and connived at by HMG – that Al Megrahi got his freedom.

It’s a toxic combination, and who better to exploit it than admen? Here’s Chrysler, courtesy of Wieden & Kennedy Portland, cashing in on the anti-Brit trend:

Yeeahs. For Brits in red coats, read Nazis (see my other post on the pioneering role played by James Mason as Rommel). While we’re there, I’m certain the Germans would have something to say about American car-building expertise. They’re less expert on the subject of freedom, though. See Pitch for more detail about the campaign.


Bye Bye American Pie as Chevy leaves Lévy – for Omnicom

May 21, 2010

Blimey, that was quick. Publicis Worldwide barely had time to savour its triumph in landing the massive Chevrolet account  – Chevrolet amounts to 70% of General Motors’ sales – before discovering it had spectacularly lost the business to Omnicom-owned Goodby Silverstein & Partners.

The loss of the account, reckoned by one well-placed insider to be worth roughly what the whole of Publicis’ UK office earns in a year, is a huge set-back for group chief Maurice Lévy.

Volt: Battery version vital to GM's survival

Not only is it a hole in the revenue sheet when he, like everyone else, can least afford it, but also a stinging blow to corporate prestige. And yet there was little he could have done about it.

So far as I can make out, this account loss owes little to agency incompetence and almost everything to new brooms sweeping clean. The announcement comes only two weeks after GM hired former Hyundai marketing chief Joel Ewanick as overall  brand supremo, pushing CMO Susan Docherty to the sidelines only two months into the job. Goodby has worked closely with Hyundai which, as is well known, is experiencing a sales surge in the USA. There’s another connection, too. San Francisco-based Goodby was once the agency for GM’s now discontinued Saturn brand.

For Omnicom, the win is a welcome comeback to the car sector. It lost out heavily when Chrysler went into Chapter 11 last year.

GM is now 61% owned by the American taxpayer and is on course for an initial public offering next year, whose object is to pay back some of the $43bn (£30bn) it owes. It has two imminent launches considered vital to its survival: a battery-powered version of the Volt; and a new Cruze small car.

Publicis originally won the business from GM’s oldest roster agency, Campbell-Ewald. Now an Interpublic subsidiary, Campbell-Ewald had held GM business since 1919.


No quarter for ad giants

July 29, 2009

GM bankruptAnother day, another dollar less. Quarterly results from the big agency groups paint a revealing picture of financial pain, and nowhere more poignantly than in the case of the stricken automobile sector.

Publicis Groupe recently disclosed that its exposure to bankrupt General Motors was ‘only’ $12.8m (about £8m) rather than the £78m (£47m) originally projected. That did little to soften the blow when the half-way figures came out a few days later: net income (pre-tax profit) down 13%, and nasty deterioration in organic growth in the last quarter. The only bright spot was a 6% increase in digital revenues over the six months. That, and the assurance of group chief executive Maurice Levy that things can only get better – from September onwards. Tell that to the 1,800 people (4% of the group) he has had to ‘let go’ this year.

Still, Publicis did a lot better than Interpublic Group, home of Lowe and McCann Erickson (one of whose biggest clients is GM). IPG has actually managed to achieve a loss of $53m (£32m) over the six months. So the reduction of its latest quarterly net income by 76% must be accounted something of a triumph by comparison with first quarter performance. Quite a lot of its losses are attributable to the severance costs of the 4,100 people it has made redundant – 9% of its workforce.

Omnicom (BBDO, TBWA, DDB etc), too, posted pretty dismal figures, slightly more encouraging than IPG’s but not, on most criteria, as buoyant as Publicis’. It is laying off 3,500 of its staff, nearly 5%. Profits for the last quarter were 24% down, about the same as the previous quarter. Which was probably pretty good really, considering Omnicom’s $58m exposure to bankrupt Chrysler. On this subject, however, chairman and ceo John Wren was understandably vague – despite analysts’ obvious interest in the subject. It was the second biggest search term employed in Omnicom’s earnings call. There are, as I have pointed out before, some unresolved mysteries about Chrysler and Omnicom.

As for WPP, we will not be seeing its half-year results until the end of August. Things are not looking too clever, though. True, WPP is the odd one out so far as the car industry is concerned. Not only has Ford not made its way to the bankruptcy court, it has even managed a small operating profit this quarter. So no write-downs; but that’s slim cause for comfort, as ad spend is likely to be depressed for some time to come. Redundancies give us a fuller picture. In a trading statement released early in June, WPP admitted to making 4,300 employees redundant – about 4% – since the beginning of the calendar year. The final figure is expected to be about 7,200.

Both Publicis’ Levy and Omnicom’s Wren seem to be spinning the idea that we are at, or near, the nadir. Don’t believe everything you hear, though. Next  quarter’s earnings may look better than they really are simply because the dive they took in Q3 last year will flatter the percentage increase. That, at least, is the view of WPP ceo Sir Martin Sorrell.


Can BBDO wriggle out of its $58m liability?

May 4, 2009

 

john-wren1Conspicuous on the list of bankrupt Chrysler’s many creditors is Omnicom-owned ad network BBDO, with an awesome $58.1m (£39m) outstanding. Enough to sink the Detroit agency, left to its own devices, and a figure all the more embarrassing – apparently – because Omnicom high command had massively underestimated the liability only a few days before in the Q1 earnings call (April 27th).

In answer to an analyst’s question, this is what Omnicom president and chief executive John Wren had to say about BBDO’s exposure to Chrysler: “I think our exposure is extremely limited, maybe really to the point of zero. If it were to take an extreme scenario the other way, which I think is remote, maybe even impossible, which would be the brands went away and we had a complete shutdown of the office, I think our cash exposure is probably to $25m to $35m. There may be some additional charges or write-off furniture and fixtures and some things like that, but I think that is an extremely unlikely set of events.”

Well, it looks like an “extremely unlikely” set of events is unfolding before his very eyes just a few days later. What’s he going to do about it?

The first thing to note is that not all the $58.1m is technically owed to BBDO. Quite a bit seems to have been contracted to local TV stations (those, that is, who were foolish enough not to ask for their money upfront in recent months). In these situations the agency normally acts as financial principal – meaning that it liable for the lot. However, Omnicom is confident it will avoid the worst on account of two factors. The government has created a special fund to support so-called “critical vendors”. A court hearing will decide whether BBDO qualifies as one. If successful, the agency may collect about a third of the $58.1 million. For the rest, it will invoke its so-called sequential liability insurance (limiting its exposure to those self-same local TV stations).

That would explain why Omnicom executives are relatively upbeat about events and why the Omnicom share price has scarcely missed a beat, so far.

However, both these factors are highly contingent. No one knows what the outcome of the court hearing will be. Nor how water-tight the sequential liability clauses are when tested by insurance companies reluctant to make such a huge payout.

Just one more thing, as the gumshoe Columbo used to say. Does this $58.1m include media? If it does, that would explain why local television stations are running scared. But not why BBDO, a creative agency, is named as the creditor instead of media buyer and planner PHD. If it does not include media, BBDO has been earning one hell of a lot in creative fees… Something does not add up. All we can safely conclude at this stage is that Omnicom is owed an awful lot of money.

One to watch, at any event.


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