What you need to know:

• Telstra seeking fully integrated creative and media to steepen growth curve. CMO Brent Smart thinks the legacy roster model less likely to deliver it due to structure.
• Hence creating new bespoke +61 agency with independent creative hot shop Bear Meets Eagle on Fire paired with TBW and OMD as “equal partners”.
• The move comes as Smart aims to shift Telstra’s spend split more towards Binet & Field’s 60:40 brand to demand heuristic. It’s currently 20:80 (though Smart acknowledges that daily retail performance media street-fights with likes of Harvey Norman and JB HiFi have “sharpened me up as a marketer”).
• Smart claims there’s nothing like the +61 model in Australia – and said while efficiency is part of the rationale, it’s not the primary focus. Building purely for efficiency, he said, doesn't usually work.
• This article was taken from Mi3's podcast interview. Get the full download here.

Telstra CMO Brent Smart says his new bespoke agency +61 is different to the one-stop shops set up by the likes of Coles. He thinks the arrangement, which pairs TBWA with indy hot shop Bear Meets Eagle on Fire for creative with OMD for media under a single commercial arrangement is a first of a kind.

“I don't think it exists in Australia – not like this,” said Smart. “The thing I'm at pains to say is this is not like one of these one-client agencies that are built for efficiency … like a Smith Street for Coles or something like that. I spent 20 years in agencies, I know the deficiencies of those models. And it's not that.”

That said, efficiency was one of the reasons for shaking up long-standing agency arrangements with The Monkeys, DDB and CHEP, which Smart described as “great partners … who made a big contribution to our business.” But the primary reason was Smart’s belief that the “classic agency roster” model is no longer fit for purpose.

“This move is not about what they [DDB, The Monkeys, CHEP] were or weren't doing. It was about if I could take a clean sheet of paper and design the right bespoke agency model for Telstra Business – and this is that [model],” said Smart.

“We had a classic roster with specialist agencies – a brand agency, customer comms agency, a retail agency and the media agency. You do get great specialisation, which is cool, but you also get duplication and inefficiency. It's hard to integrate and it's expensive. So that’s all a factor in this,” he told the Mi3 podcast.

“But the biggest factor is I don't think that is the way to get to the very best creative work. So this is a better creative-led model, but it's also about a model that is better for integration and a model that takes out inefficiency.”

Inefficiency and overlap is not necessarily the fault of the agencies, per Smart. “It just happens naturally, because there are so many people, so many projects, so much going on… you have to work hard to make it efficient.”

Hence deciding to start from scratch and pair an independent with a networked creative agency and have both fully integrated “upstream” with media.

Best of both?

“I think for a lot of people, it's indy, or network – and they’ve got to make a trade off. They can have the high creativity, independence, a strong opinion and the ‘purity’ you get with an independent agency, but they have to trade that off against the big strategic firepower, the operational muscle, the integrated capabilities and the ability to handle a really big account that you get from a big agency, who are usually network agencies,” says Smart. “So I guess where I started was, what if we could have both? Why can't we have both? And that is what this model is about.”

The key to +61’s success will be how well Bear Meets Eagle on Fire and TBWA can work together and avoid a “marriage of inconvenience,” Smart acknowledges, while integrating creative fully with media via OMD, which has held the account for 17 years.

“The glue in all this is OMD. So how do we bring in a media agency in a way that's fully integrated, so we've got proper creative and media integration happening – we don't lose that knowledge – they know our business inside out. So, it’s best of both worlds. I get two fresh agencies and I get an incumbent who knows our business really well,” said Smart. “So that de-risks this move in many ways.”

Plus, the fact that both TBWA and OMD are Omnicom-owned provides additional incentive to make it work. But Smart underlines that all three agencies are “equal partners … and we've taken time to architect that and agree to that.”

Integrated, not co-located

The +61 team won’t be housed under one roof, says Smart, though will come together once a week. “It’s not about them working in the same space. We’re not forcing people to co-locate.”

The ultimate KPI, per Smart, is properly integrating creative and media to drive growth with creative influencing media rather than simply the delivery mechanism.

“It’s about the two [aspects] working really well together upstream. It can't be ‘here's the media plan go and execute, fill in the boxes’. That doesn't work any more. It's got to be content, context, working hand in hand – and we think we've got a model that will deliver that,” said Smart.

“Obviously, it's not going to be perfect from day one. But the important thing is the intent is absolutely about having creative and media really, really integrated. So I think it’s going to bring out the best in our agencies – and I want to be part of that.”