The final session of Day Two at the Festival of Media 2009, currently on in Valencia, Spain – Global CEO Spotlight – saw a packed house. The high-powered discussion saw AdAge Editor Jonah Bloom grilling Jack Klues, CEO, Managing Partner VivaKi (Chairman, Publicis Media Groupe); Nick Brien, President and CEO, Mediabrands; Mainardo de Nardis, CEO, OMD Global; and Dominic Proctor, CEO, Mindshare, on recession, its impact on media services and some aspects that need a closer look today.
The panel spoke on a series of subjects that were undergoing change due to the recession, and steps, which would have had been a part of the natural evolution of the media service business has been sped up due to the current economic environment.
Reframe the conversation with clients
The first subject to come under the scanner were clients and whether the conversation with them needed a revisit, especially when the risk factor had increased in the business. Klues said, “On the one hand, it is important today to focus on what is important for clients, and what needs to be included in the conversations between clients and ourselves. We are in a phase to standardise things, focus on the overall process and at the way we transact, over different things in different times.”
The big question of collaboration with clients was posed again, and the panel delved on the risk factor that had increased in today’s scenario from simple aspects like clients going bankrupt to long delays in payments. Brien said, “The good client relation is being reflected even more today – both from an economic and social point of view. Yes, the risk has increased, but that is the nature of the industry.”
Mainardo de Nardis agreed and pointed out, “There is risk involved in any economic background and at any stage but today the risk varies from small percentage payment to long delayed payments to even a client going bankrupt. In that scenario, it is even more important to choose the areas that you want to focus on.”
Dominic Proctor reiterated on the point that the media service agencies couldn’t afford to continue to compartmentalise, since then it would be difficult to get any effective solution.
Media Agency Biz: It was time to reinvent the wheel of Remuneration
All speakers on the panel agreed that the time had come for another step in the evolution of the media services business and that it was important to guide the changes that should be made in that direction. Klues said that even as agencies reframed their relationships with clients, and got to a place where they could take a definitive stand on the market, they would get a better grip of the direction in which the business was moving. The panel said that with risks came the rewards, and the new context needed to demonstrate the creative collaboration in a strategic way that could include accountability in the overall picture.
The panel spoke on the shared responsibility with clients and that any approach couldn’t be isolated in nature – it had to be about the entirety of the matter.
The current agency model that appeared fragmented with the specialists within the domains and no real generalist to take charge of the overall communication was debated too. Bloom’s question here was that the very nature of the model didn’t allow communication solutions to emerge, and was more about a total at the end of an excel sheet. The panel agreed that the new agency model would ideally have to see better integration within the media services itself.
Mainardo de Nardis here stressed that it was time to reinvent the wheel of remuneration, and base it on value, and not on inputs like time spent or man hours used.
Revisit that media owner brief
How one worked with media owners in the current context was another important point discussed in this session. The question was when the focus is on a number like reach and frequency, was the discussion even remotely in the direction of attaining a marketing solution? Were media agencies giving media owners a chance to be partners?
Mainardo de Nardis confessed that when the discussion was on numbers, the experience had a limitation. He said, “The relation and the brief needed to be revisited.”
The jury was still out on whether new forms of communication such as branded content and other advertiser related content creation would be working better today had the relation with the media owners been different.
The panel also delved on social media and the fact that clients didn’t have much choice on that kind of communication anymore – they had to be a part of it anyway, and the smarter client would be the ones that would try and influence the conversation there than avoid it.
Nick Brien said that there were many abnormal changes that the recession was forcing on clients, and once this phase was over it was difficult to ascertain what the media agency business would look like. Dominic Proctor added here that agencies today were much closer to being properly paid than they were five years back, and more steps in that direction would emerge.
The panel stated that if the recession was seen only as a rebasing exercise, it would be monstrous mistake. The media scene would be different when the dust settled down and consumers would lead that change too. It was however wise for media services to take steps today that would take the industry to a better place tomorrow, and it was important to keep investing and keeping a track of the consumers.