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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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Hello from the man who said “Tchau” to StrawberryFrog

March 6, 2013

Alexandre-Peralta-766x1024It’s over a year now since Peralta founder and CEO Alexandre Peralta expunged (literally so) the StrawberryFrog images sprayed all over the interior of his Sao Paulo hotshop. How’s he getting on in the wake of his split with mercurial and moody SF panjandrum Scott Goodson?

The other day I caught up with him and had a chance to find out.

Peralta, it may be recalled, is a copywriter by background who worked at some of the big multinational agencies such as DDB before moving to local Brazilian agency, Africa, as its creative director. When he set up shop with New York-based Goodson in 2007, the idea behind SFPeralta was to provide Goodson’s micro-network with an arm in the booming BRIC market and Peralta with access to international clients.

It didn’t quite work out like that. Peralta did indeed acquire international clients, such as PepsiCo’s snack business – but no thanks to StrawberryFrog, which became increasingly beset by financial and managerial crises. The result was an amicable (well, more or less) decision to go their own ways. Goodson needed the money (he had a 30% strategic stake in SFPeralta, but no managerial interest) and Peralta felt his agency would be better off without him.

Rightly so, it turns out. At the time, the Peralta Sao Paulo business had revenues of about $8.5m and was growing 50% a year. It has won new international business, including Bacardi Brasil (Martini and Grey Goose) and two Mondelez brands (i.e. Kraft of yore); more business from existing clients Pirelli and personal care company Natura; plus Vigor – the Brazilian dairy company giant. So much so that the agency is putting in place for the first time a chief operating officer.

063e7c5The new COO is Jairo Soares, a partner and media vice-president of Peralta these past five years.

At the time Alexandre Peralta dissolved the StrawberryFrog link, his agency was being actively courted by MDC-owned CP&B. Nothing came of that overture, and Peralta Sao Paulo retains its independence. However, the founder remains open-minded on the need for a collaborator:

“An international partner can be welcome in the future if it is capable of improving our portfolio even more,” Peralta tells me.

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StrawberryFrog is up for sale, but will anyone want to buy it?

November 3, 2011

Word reaches me that StrawberryFrog, the maverick international advertising network, has hoisted a discreet “For Sale” sign. Whether it will succeed in its objective is open to doubt, as will be seen below.

First a little background. StrawberryFrog – curiously named after a colourful, nippy and spectacularly poisonous Latin American amphibian – was founded in 1999 by Canadian entrepreneur Scott Goodson as an agile alternative to the big, cumbersome, advertising holding companies. Goodson, who remains to this day head honcho, likes to see himself, and his company, as an avatar of what is called Movement Marketing, a concept first dreamt up by sociologist Neil Smelser. Stripped of jargon, this means “avantgarde” or “revolutionary”. In practice, Goodson was one of the first to spot that small, manoeuverable agencies with strong creative ideas that travelled well could use digital leverage to undercut the legacy giants – with their expensive but increasingly quaint bureaucratic structures wedded to traditional advertising.

For a time things went extraordinarily well. With only 2 offices, one in Amsterdam and one in New York – which deployed a staff of no more than 70 “Frogs” (but rather a lot of freelancers) – Goodson and his co-founder in Amsterdam, Brian Elliott, pulled in some extraordinary global business. We’re talking Sony Ericsson (when that was still a name to conjure with), Mitsubishi Motors Europe, Pfizer, RIM’s Blackberry, Ikea, Heineken, Morgan Stanley, PepsiCo, Emirates – to name but a few.

In 2009, the agency reached its apogee when – against all odds –  it seized the prized global digital account of Procter & Gamble’s biggest brand, Pampers, from under the nose of Publicis Groupe’s Digitas and WPP’s Bridge Worldwide. It was not even a P&G roster agency. Pampers remains StrawberryFrog’s most prestigious account.

But that was then. From thereon in, it seems to have been downhill.

Already, the cracks had begun showing when in 2008 Elliott broke away, rechristening the StrawberryFrog Amsterdam business Amsterdam World.

True, Goodson (left) patched up the network. He set up a new Amsterdam office, and had already opened a successful Brazilian boutique in Sao Paolo, a shop in Mumbai and disclosed his intention to set up an office in London (project later aborted). But he signally failed to control his New York hub, which has gone into freefall.

Not a week seems to go by these days without news of redundancies, stories emerging of Goodson’s increasingly tyrannical behaviour and acrimonious exits by senior staff. Two of his former top team are, I’m told, suing. One, ex-chief strategy officer Ilana Bryant, wants $2m for alleged breach of contract (I should add in fairness that StrawberryFrog is counter-suing her for $50,000).

All of which, as can be imagined, does little to impress clients, who have become still more alarmed by rumours that StrawberryFrog’s NY office is increasingly reluctant to pay its suppliers’ bills.

By way of illumination, some interesting “numbers” recently came into my hands – from what appears to be an unimpeachable source. They are as follows:

NY office: Dire. Revenue has declined from $17m (2010) to  about $12m (2011). A loss of $600,000 is expected this year. NY has about 40 employees, down from 76 a year ago.

Amsterdam and Brazil have different ownership structures to New York: Amsterdam is smaller by revenues, and expected to generate a $200-300,000 loss this year; Brazil has about 80 employees with $8-9m revenue – it is profitable.

Back in 2007, StrawberryFrog came quite close to sealing a deal with Publicis Groupe (it failed at the due diligence stage). This time a sale is more urgent. But I wonder whether Goodson will be able to find a buyer.


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