MIXX and The New Strategy
The first panel from MIXX. I found it interesting that there was some obvious tension between the panelists and the conversation got a little heated at time.
The New Strategy
Through the entire history of advertising, marketing strategy was realized through a small set of look alike content formats on a limited set of mass channels. Today, thanks to dramatically lower entry costs and the limitless innovative potential of digital media, leading practitioners are learning that strategy, content, and channel must be integrated from the inception of a marketing campaign - and marketers, agencies, and media must find new ways to partner.
Moderator: David Kirkpatrick, Senior Editor, Internet and Technology, FORTUNE
Panelists:
Carla Hendra, Co-CEO of Ogilvy North America
Rishad Tobaccowala, CEO, Denuo, Chief Innovation Officer, Publicis Groupe Media
David Verklin, CEO, Carat Americas
DK: advertising is funding a lot of technology evolution. every interesting tech company want to monetise itself with advertising and are building solutions. so what’s going on
RT: there are multiple answers…one of key things that we recognise we are moving into an age of facilitation. we look for collaboration iteration and learning. the future does not fit into the containers of the past. Denuo are a fresh sheet of paper, to get our clients to the future fist. it’s not consulting, it’s can we make it happen today. we started with 15 people (misfits in toyland, the weirdest people I could find) now we have 24. we offer flexibility to our clients, all for a year or 1 person for an hour. completely plug and play. we will work with anyone. it has to be SOX, ethical and we won’t plot to being down Publicis. we are now profitable!
DK: too Carat fusion, Carat USA and turned it into Carat Americas
DV: the pace of change is staggering. 2 years ago we were asked for demonstrable capabilities, you had to prove you were a real digital agencies. we e saw a lot of online agencies and media services agencies. We collaborated brilliantly (USA and Fusion) we worked on Adidas, bought them to work together pretty good. but you can only take it so far when 2 separate companies. we do not have to prove the digital…or the big services. clients want us to manage the brand, across all touchpoints it is not integration when 2 agencies. it is not integration, it is synchronisation. we turned it into a single enterprise with a single P&L. never been done at the is scale now. we think it is the new model. Fusion was a full s service digital agency. w e believe that taking online and offline and in a single company the future.
DK: Carla, is that a challenge…are you doing the same thing,. it is still structured the separate way
CH: everything we are doing is messy. that is a good thing is you embrace it, can take hold of the pace of change and o some really good things, it is also really scary, nothing fits into the neat little boxes as it used to. we have to think of new ways on how to be organised. our clients also ask how they should be organised. service providers can move so far, but we are limited to some extent by what our clients will do. This year was a true tipping point, clients really got it. business is 60y, direct marketing for 35yrs, our interactive is 25yrs. everything we do is built around the brand and the customers…if there was online that characterised what we have to do different…’it’s the customer stupid’ there’s a complete flip, the consumer is in control, there are no secrets, everything is transmitted immediately and perpetually. at Ogilvy, we have a strategy around 360degreee brand stewardship and digital has made that strategy more seamless and more appropriate. inside O&M we operate with a total end to end way to look at things. we have all parts…PR is part of the mix. Unpaid media is one of the most important tools that exist. Our clients do not always buy everything from us. We collaborate in group and outside/ there’s not one answer. clients want what they want when they want. we have a structure that works but we have to be pretty flexible, we have to bob and weave all over the place. some partners need to be providers, sometimes partners and sometimes clients.
DK: do you buy that?
DV: no. it’s not that complicated…bring media company in.
CH: Neo is inside the company. the buying is separate it’s about amalgamation of buying power. out clients want everything together, we plan together
DK: you don’t find having diff P&L a problem…
CH: the US is a single one, with lots reporting up to
DK: so Denuo was that a response to your frustration to the media buying world: it was a recognition that there is more than one flavour. there is more than one model. i was aware of a lot of models that we had. what i did not see was something in this niche. I go to places that were unoccupied. clients were saying, that the future may not be an organisation, it may just be a whole bunch of talented people working along side us. thats what we created..can we collect a whole bunch of talent, can we do this..it seems to be working but it is early.
DK: you focus on the needs of the individuals. you need real rocket science for some of it
RT: these are people that have come from a lot of trad background. they need the scale of the large companies (hence why in publicis) but this is trying to get them in different places. One of my colleagues sit in droger5. in LA they sit in leo burnet…they sit all over. all based on simple belief that if our talent is happy, if our clients are happy and pay us well to pay the talent well, then that is a good thing. not claiming that this may scale as these others, but it is working and it is a good model we can select clients so it is probably a good model
DK: as a strategist at Publicis/.do you see merging in?
RT: yes and they will diversify at the same time. people will always be analog. we recognise this. people think about diff structures. people will always fight about power, money and fame. it will not change even when webv37.5. when something becomes digital it becomes good. so look at the new frameworks to set up. One problem with integrating. There are benefits and there are downsides. an integrated org can sometimes not move fast enough, or you may lose specialism,. so we are looking at ways at keeping both. I have no idea about what will change our world. it does work around talent, my belief that some will want to work in one model and others another model. the team with the most talent will win
DK: talk about the Dove thing? what did you learn?
CH: we did not ness learn about the structure. we operated with an integrated team globally for some time. this was the first time where we could see such a quantum leap with client willingness to take risks and do something new and the results that came in were phenomenal. we fail a lot but you have to do this to learn. this time the stars were aligned and we got lucky and got great results. we talk a classic approach. with the client wanting to make Dove a classic brand, global, extensible. we started with the insight, look to build around, did research in 10 countries. 98% of women in the world do not believe they are beautiful From that, from understanding the appeal to real women, we were able to carve out this raging debate about beauty and the industry etc. this was a rich vein, for us and for all of the women that got engaged in this debate. we had some good help, Oprah got involved in a big way. we did an online based launch, some print and some outdoor and she spotted it and got the Dove girls on the show,
DK :you changed the landscape of an industry there. Once you had the success, it changed how you did the other stuff.
CH: in some circumstances we were forced to, the women wrote the stories, we tried to share them and take them to a new level. we launched Pro-age, an extension, the opposite to ‘anti-aging’ we started with a commercial, with Annie Leibowitz photos without clothes 50+, we did a contest to get the picture in times square. The networks did not want to show the ad with women 50+ . we ran a 15′ teaser, pushing people line to see the ad. It exploded, on Oprah again. you have to be able to cross back and forth across the lines. all these ‘line’ terms should go away, marketing is in the aether now and if you can tap into this and let your consumers write your stories. it created about 1.2billion in value. 500m people have seen our videos.
DK: David, what do you think you can do that others can’t because of your new structure
DV: the Dove campaign is spectacular….we looked at the campaign at Cannes this year, I think it is spectacular.. I think traditional media, to thrive in the future, digital has to be a the core of the strategy. I think the market has shifted and we need to come to place to do the comms plan first. clients are asking us to allocate the channels, help me undrestand how to manage budget across touchpoints. The hottest word is media mix. the typical plan today is much more complicated than ever before. it’s not going to get simpler. it will have more touchpoints and digital has to be at the core. we are going to take tv and drive people to a website. for many clients, I would rather have you go to the website rather than a store. mass media to the site, not ness a store. on the site, they can shop, transact, or find a store.
DK: or you can create a record of what they want and build something better
RT: I agree that clients are looking for allocation, that digital will be important but not necessarily at center, and that things are getting far more complicated. What I would change slightly, I believe that an insight or an idea is the center and you can do stuff with no digital. if there is a poor site then you do not want people to go. the reality of it is that traditional media companies have been thought of as allocating paid media. the reality is there are lots of things that are not paid media. there is much competition and media companies do not have access to the right people. creative is a mindset, but there are certain people that do things that others would not. Clients need diff people…sometimes with putting people together you may have talent that clashes and the client will not get the best. What happens if client does not pay this, or does not pay you for placing media etc. you need to look at what is the economical model. some of the larger structures are built for one model, some of the newer ones are newer structures, it’s a little complicated
DK: so how do you get paid for this? Not resolved yet.
AudQ: unpiad media with paid is the real integration. that is the real challenge - why do we not have the PR people on panels?
CH: we have it in the mix..but the real good stuff is the digital influence inside the PR company. how does the PR company capitalise on new channels
DK: David, there was an implication that you had no PR so at an disadvantage
DV: we do things, WOM marketing, SEO, why do you think that digital spending is 8%, we are approaching 20%.
DK: I hear you say digital is integrated
RT: yes…earned media is there as well. it is not PR - buzz and WOM…different., we are all trying to grapple with programming and marketing on the decentralised link network
DV :the great brands are not going to tell the best stories but they will be the brands about which the best stories are told.
RT: a lot of the future is marketing services even in the most categories or countries. you peak at about 30% online. when you move dollars the outcomes and measurements change and the fundamentals of economics change there is little model for marketing on networks, we have a good idea on search. but average is 56c a click 0- that a lot per 1000. far more than 20$ offline.
CH: 20 years ago it was $600 a thousand on direct marketing for mail lists. if you think in CPM only, then limited. it’s moving to CPA etc. clients have looked at things one way for a long time and we have to change
Q: RT, you talk about talent and acquiring talent. how do you do it? how do you co-ord comms?
RT: get people who are likeminded, who buy goals, who are part of the outcome. Talents need to be involved in the creation of what they are doing, a collaborate model. we make certain we have profit margins higher than the rest of the groups so we can pay more than the rest of the group. Money is long, talent is short in this world.
DV: we try to get people together, we increased our travel budget, we push the content
- end of panel -
RC: I did not capture all of the Q&As at the end as the answers were often very fragmented and on write up decided to remove them! Overall, this panel was pretty good, showing the large divisions between agencies and how they think the future is going to pan out - digital at the heart or just another part; marketing services and added value or still following the same old models. As someone who works in the social media side, who does a lot of education, who may not directly create campaigns, I’ll all for changing the model. From my perspective there may be far more value in spending a few days working with people too create a corporate blog that they can run for a long time than there is doing a series of campaigns - but it is far easier to monetise the latter in the current models. Rishad’s model would therefore be a better fit for what I do.
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