What you need to know:

• Dimitri Maex, former global CEO at IPG’s Reprise stepped into the top job at Initiative a year after Mat Baxter had swapped out to lead stablemate Huge.
• While Baxter’s now touting market mix model disruption, Maex is likewise attempting to nudge marketers away from an “outdated” construct – the marketing funnel – which he says is crimping growth and driving “out of whack” media investment into performance channels.
• While some suggest the funnel is collapsing, Maex says it never existed in the first place.
• He suggests marketers could do worse than read Paul Feldwick’s The Anatomy of Humbug to understand why they need to overhaul their models – and the same goes for most of Initiative’s clients.
• With platforms automating targeting, he says brands are losing control and must “game the algorithms” to get it back – and find value amid rapidly diminishing media diversity.
• Maex, who also previously helmed Ogilvy's direct marketing unit, forecasts consolidation of media and creative – a remarriage – as AI and automation replace many of their key traditional functions, forcing major diversification into experience, CRM and commerce that he says is already well underway.
• He won’t be drawn on AI headcount impacts for agencies – but admits predictions that the vast bulk of traditional tasks will be entirely automated within five years may not be entirely outlandish.
• Meanwhile, headcount at the agency locally diminished by three last month as the senior leadership team defected to Accenture Song.
• But Maex is sanguine – and backs the incoming leaders to take it up a notch.

False construct

The explosion of retail and commerce media amid an accelerating flight to digital performance channels has led proponents and platforms to talk-up the collapse of the marketing funnel. Initiative global CEO Dimitri Maex goes a step further. He says it never existed in the first place.

“The funnel was never real … It was written by a sales guy in the 1920s … But it was a useful a useful model to explain to people who don't understand marketing how marketing works.”

He goes further still.

“We are all using mental models or marketing that are pretty outdated. I still see lots of funnels, lots of brand versus performance trade-offs. We all know that these models aren’t true. That is not how people actually buy. But that’s how people look at the world of marketing because it's easy to explain. And then it's backed up by all these digital metrics that have basically pumped tonnes of media dollars into performance at the expense of brand,” he tells Mi3.

That balance, he says, “is little bit out of whack.”

Mental non-availability

Initiative is trying to adjust that balance by restoring some model order. Most brands, says Maex, need to do likewise.

“We talk to CMOs in very big companies. You ask them how does marketing contribute to business. You get so many different answers, because most of them don’t have established models.

“Some do. Very sophisticated clients have a model that is well articulated, researched, measured and communicated throughout the entire organisation that drives integration, drives focus. But most of our clients don't.”

Hence Initiative trying to convince them to adopt its own ’fame and flow’ framework. There’s some mechanics behind it, but in short, fame is making brands stand out in culture and flow is making it easier and better for people to buy their stuff.

“You have a very easy concept to explain. You have the metrics behind it. It's rooted in science. You have audit tools, and then we're trying to get these things into our media planning tools as well. So that ultimately the media plans change…”

Plus, he says that model “will drive much more integration with creative agencies” as brands increasingly seek to connect experience design and CRM with media. “We’re already seeing that in tonnes of pitches,” says Maex. “So I think that is the future, we’re going to need to bring these things back together in some shape or fashion … that is definitely a trend that is happening.”

Others agree. Forrester last month suggested end-to-end creative and media capabilities allied to tech and data have put some holding companies ahead of IT integrators when it comes to commerce. Accenture was the only other firm that Forrester ranked alongside the holdcos as a commerce leader – and the consulting firm is likewise pulling together full service capability, most recently poaching Initiative’s local leadership team to add media services to Accenture Song locally.

That development potentially puts a question mark over Initiative’s long-term future with IAG locally, given the insurer recently appointed Accenture Song to deliver end-to-end services.

Either way, IAG’s chief customer officer and ex-Meta global exec Michelle Klein is currently a client – and vocally agrees that the old marketing funnel is dead.

Funnel revision

Maex suggests marketers could do worse than read Paul Feldwick’s The Anatomy of Humbug.

“It’s really good. It gives you a history of mental models of marketing for the last 100 years … Some of them made it into practice. Some of them live more in academia. But most of the more recent ones, they acknowledge the role of emotions in decision-making. The funnel doesn’t. They acknowledge the long-term impacts for brands which exists and has been proven over and over again, which the funnel doesn't. They acknowledge the importance of fears and social pressures on decisions [the funnel doesn’t]. Those things are all very, very, very important … Nobody buys in the way a funnel works. It’s a trap,” he says.

“But that's the opportunity, if we can create language for CMOs and tools that use some of the research that we own, where decisions are actually making a better representation of reality, I think you'll see the dollars move in a much more balanced way.”

Hive mind games

The dollars do need to move in a more balanced way – but it's not looking too likely. Maex’s counterpart at Wavemaker, global CEO Toby Jenner predicts that Alphabet, Meta, Amazon and maybe TikTok, depending on what happens in the US, will be taking circa two thirds of all media dollars – not just digital – as early as 2028.

That effectively means media agencies and brands will be trying to outdo each other on just a handful of global platforms across most of their ad spend, which significantly limits choice.

“It does,” agrees Maex. “And it's not something I’m necessarily happy about. I think the media ecosystem would be a lot healthier if you'd have more options. But it's that is the reality, especially in the performance space.”

The upshot is that brands and buyers will lose even more transparency on how their money is spent. Maex’s advice is to game the system.

“Clients increasingly are going to become blind to the actual decisions that are being made. So who you target … that's the game of the algorithms and the platforms, to be able to automate all of that with the promise of performance – and that's a little bit dangerous because you're giving up a lot of control,” he says. “So what we try to do is advise our clients to sort of game the system.”

How?

“Through experimentation, mainly. You'll see a huge comeback of experimentation because you're not going to be [doing the] targeting yourself anymore. If the algorithm in the middle is making the decisions, you can feed it stuff and see what comes back and compare it to the information that only you have – and the algorithms don’t have,” says Maex. “So that's the future and it’s going to be very, very different … You've got to game the algorithms.”

Numbers crunching

Maex won’t be drawn on the impact of automation and AI on headcount. The truth is, nobody knows.

“I think it’s useful to look at tasks instead of people,” is Maex’s answer to suggestions that 20-30 per cent staff displacement within three years is likely for agencies when the impact of offshoring is thrown in.

He thinks there will be some gains. Juniors won’t be stuck wading through spreadsheets for the first few years before they can move up and let the new grunts to do it instead.

“We’re trying to kill Excel everywhere. But just to be clear [the juniors] are still doing very, very manual work, which leads to disillusionment. So I think those tasks will absolutely [be automated] and it will free up people to do a different type of work. So we need to completely change the nature of what we do as an agency,” says Maex, repeating that ”a consolidation of creative and media” is likely for that reason – and agencies are already diversifying into CX, CRM, commerce and beyond.

US-based media ecologist Jack Myers also sees creative-media reunification ahead. He’s forecast that fully 80 per cent of current media agency tasks will be automated within five years – and Myers has previous for ending up on the money.

No global CEO is going to make that kind of call.

“I can’t give you an exact number,” says Maex. “But... it wouldn’t surprise me.”

Life goes on

If Maex had an inkling that Initiative was about to lose its local leadership team over that café table, he didn’t show it.

Either way, he’s looking for a new team, and told Mi3 this week Initiative is still mulling candidates internally, within the broader IPG network, and externally.

But he was effusive about the job done by Fein, Geer and Colter – and magnanimous in a way perhaps few local bosses would be in similar circumstances.

“I wish Mel, Colts and Sam all the best. They have made an incredible contribution to Initiative in Australia over the last couple of years. They have left behind a fantastic team with a great culture and I am grateful for everything they have done,” said Maex.

He’s confident whoever leads the business has a solid platform to build on.

“Initiative has a tonne of momentum at a local, regional and global level and I know our new leadership team will be able to take the company to new heights.”