WPP building the next generation agency?

Currently attending a panel with Lance Maerov, the SVP Corporate Development (read M&A) for WPP and Trevor Kaufman, the CEO of Schematic, a company they bought last year as part of their string of nearly a hundred acquisitions and investments in 2007. They're talking about how traditional agencies are acquiring and investing to stay relevant in the years ahead. I have a short excerpt in the video below, but here is a summary of interesting points:

• traditional agencies realized sometime last year that they were quickly becoming less relevant and being challenged by new players. Their response was pretty much that of any incumbent: buy what you can't match. The interesting question is how will they actually address the challenge of truly integrating the acquisitions and achieve a fundamental transformation of the DNA of the traditional agency business;



• topic of building the next generation agency seems to be in the CEO's agenda at WPP, which is a good sign and pretty much what is also happening at Publicis;



• choosing for acquisition targets they went first for companies they had been in touch with for a number of years;
• big focus on BRIC countries and North America;



• the traditional agencies are choosing companies for acquisition based on their size and business potential, looking for good management teams in place because they don't have the skills and resources to take over the management of these companies. In Maerov's words "if an entrepreneur thinks that WPP people will start running his business once the acquisition is done, that's a red flag for us and the deal will not happen";



• areas of interest include behavioral targeting, analytics, interactive capabilities, integration between online and off-line spaces;



• in the video below they mention 24/7 Real Media, another acquisition of WPP in 2007, which they said was interesting because it allowed them to optimize campaigns both online and off-line;



• Maerov said despite the purported slow-down of the economy he sees no sign of budgets being reduced and that WPP will pursue an aggressive strategy of acquisitions, something that is confirmed in this article of the NY Post;



• in the same article they mention a recent acquisition through JWT of 75% of Belgian Tagora, positioned as a dialogue marketing agency, with annual sales of 5.3 m$ (3.6 m€ with gross assets of 2.74 m€ end 2007). Could not find the acquisition price, but I would be interested in getting it...

OnMedia_NewNewAgency
Video sent by alexpapa

 

The American spirit of rising to the challenges ahead

Being in NYC these days, I am spending quite some time observing the city and its people as well as watching those huge screens displaying TV programs on the avenues of the city that never sleeps. These are uncertain times for the US economy and one of the things I was looking for was how people would react to that. First of all, I see none of the gloom and doom even though people acknowledge the ride ahead may be quite bumpy for a while. Secondly, I am impressed with this very American way of seeing opportunity and rising to the challenge in troubled times. To illustrate this, I see quite a few people who are turning the current pressure some people feel into a business opportunity selling books and workshops on how to make real estate decisions or how to reduce debt. Some authors do that positioning themselves as experts while others occupy the "consumer activism" space defending customers from the nasty tactics of credit card companies and other providers of financial services. And this is quite intense.

So there's a big difference between US and Europe: the Americans are able to see opportunity in almost any trouble, while Europeans see trouble in many opportunities. For example, the way we handled the expansion of the EU to Eastern Europe is perhaps iconic of this: the French started complaining about Polish plumbers "invading" their market and no public figure, no political leader trumpeted the only message that was constructive back then (and perhaps now): "go East young man!"

Direct from AlwaysOn OnMedia NYC 2008

Just got to the OnMedia conference and glad to be here for a new edition meeting friendly faces from previous events. Same posh location and already a couple of very striking facts for the marketing & communication industry or at least stuff I found quite interesting and worth commenting:

• found a flyer of IBM Global Services giving their analysis of the momentous changes this industry is undergoing. My take: if IBM GS is around looking for business the changes could be even greater than we think in the field of media & marketing;



• fact from a KPMG survey of 300 CEOs,executives, VCs and insiders of the industry: 64% of them feel between 26% and 50% of media time and spending is to shift to new media;



• fact from the same survey: 91% feel advertisers have not figured out how social media fits into marketing mix;



• search engine marketing voted most effective form of online advertising by 71% of those surveyed;



• large majority see mobile marketing effort increasing within the next couple of years.

Interesting trends don't you think? Of course as a friend of mine keeps saying surveys can be twisted to convey the desired message, so they have to be taken with a pinch of salt, but nevertheless the field is ripe for some momentous changes, all of which may not necessarily be in favor of Google. For example I doubt AdWords will be successful in its current form in the long run... but that's for another post :-)

What makes a commercial powerful and lasting?

Since I am in Canada these days and since I am most interested in the momentous changes that have been going on in the field of marketing for the past couple of years, I 'd like to comment a beautiful advertising campaign. It's the Molson campaign that was released many years ago and which plays very well on the existence of stereotypes commonly held by Americans about (did I say a-boot?) Canadians. Quite clearly this is an ad that captures human attention mainly because it's fun and light. See for yourself:

But there are other aspects to it that are interesting amongst which is the fact that it lends itself to sequels and to further exploitation of the dominants stereotypes. Here's a second film that illustrates this:

On the same theme, a couple of friends told me about (a-boot?) somebody who produced a derivative version of the Molson ad that makes huge fun of the cultural divide between French speaking and English speaking Canadians.

Perhaps a good way to bring sterile debates to a fairer proportion than politicians would like to and perhaps a good inspiration for somebody to do something analogous in Belgium because the people of that country deserve a much better political leadership IMHO.

So, what makes a commercial powerful (i.e. capable of seizing human attention in a world of content overload)? What makes it last and get a second life in a radically transformed media environment? I wonder whether there are other ads from past years that could be exploited by modern day communication agencies in the interactive space as shaped by the Internet to deliver high impact campaigns...

Great to be in North America

First of all, I want to share with you something that has nothing to do with the post itself, that is my great excitement at being in North America for a week or so. I just landed and the welcome is really professional and at the same time very warm. Went through New York border controls where there was that smiling police woman who delivered a real piece of wisdom when I greeted her asking how she was: "I'm doing pretty good and trying to enjoy every moment 'cause one never knows when one will close their eyes forever".

Anyway starting next Monday I will be attending the AlwaysOn Media NYC conference, which I expect to be great. I am genuinely impressed with the way this conference business is being managed by Tony Perkins & team.

What's key in guiding customers?

"In giving advice, seek to help, not please, your friend."
Solon

Over the past couple of months I've been working on some pretty confidential stuff that made it very difficult for me to share on this blog. However, as I seek to guide my customers towards maximal achievement of their personal and business potential, there is definitely one thing that I am faced with on a near permanent basis: telling them what they need to hear and not what they would like to hear. As an external contributor to their business, I consider integrity as my key asset because it provides the bedrock of coherence, rigorous analysis and compassionate advice. So of course, one of the things I am careful not to let customers do is use me to justify their decisions regardless whether I agree or not with their decisions. Hence the quote above.

Lessons from the 2008 US primaries for business

I usually keep myself from dealing with politics on this blog because that's not its purpose. However, sometimes politics provide good examples for business, if not in terms of concrete actions at least as regards communication. In the past couple of weeks I have been following pretty closely the US primaries and the heated battle between Barack Obama and Mrs Clinton. A couple of key lessons to take home:

1. consistency of message is paramount - Obama's message has always been "Audacity - Hope - Change" and ever since the DNC of 2004 he keeps talking about the irrelevance of "red" and "blue" states vs the utmost importance of the United States. Clinton's focus of message has moved from experience to change as voters showed an inclination for what the Senator from Illinois proposed. Even though adapting is important, there is considerable risk in doing that in such a short period of time. The same holds true for communication of products and services. Consistency is really paramount and if you have to adapt to an audience, then you ought to look for a smooth transition.



2. values-based communication works - Obama's message has been very much about the traditional US values that historically have been behind the drive of the American people to forge a "better union" holding a number of truths as self-evident. Clinton's message is about her more than it is about values. Values-based communication is extremely powerful when there is an alignment between the values of the communication and those of the audience.



3. positive massively surpasses negative communication - Obama's pitch is about what he can offer whereas Clinton's is about why Obama is not good enough. The human mind can picture positive messages but has hard time with negative messages. Tell people what you want them to do, not what you don't want them to do because the former gives an objective whereas the latter defines a scope of avoidance.



4. dream beyond current means or risk being mediocre - Obama speaks about what might be that seems very much out of reach today considering existing resources. That is what inspires people and the power of inspiration drives exceptional performance. Would there have been Picasso if he had not dared challenge the status quo and what was widely considered to be  acceptable with early twentieth century's painting standards? To inspire your teams, your customers and your investors make sure they buy into where you want to go and they will help you get there. No major accomplishment in business is possible without the audacity of dreaming beyond current means.



5. authenticity and transparency are huge assets - when too much information and message spinning goes on the message ends up having no effect or the opposite effects from those initially intended. Ultimately when one is taking the risk to lead they have to accept that there may be mismatches between what they say and what an audience wants to hear. Elimination of those mismatches is an illusion and vowed to fail. Rather, being candid about those differences is what ultimately leads to a match between an offering and a market. In other words, being humble, accepting multiple iterations in order to get a message right and doing so while preserving transparency and authenticity is a good recipe for success in communications. That may seem to contradict point 1, but it does not; rather it provides a balance between consistency and the absolute need to be receiving feedback from the audience.

Wishes for 2008

May 2008 bring health, happiness, harmony, peace, creativity, beauty, love, success and whatever is best for you and your loved ones. In particular my wishes go to companies and teams I care about in a special way: Weingut Jostock-Bülhoff, Technoport, CRP Henri Tudor, J-Way, Jamendo, Jilbee, Mocom, Airfield, Conostix, LegitiName, Vanksen, BuzzParadise, Vanksen Group, Triodos, van Hoorebeke Groep, Christoulis Building Company, Manex and of course to all my future customers ;-)