What you need to know: 

• DDB in Sydney may have lost a major client in Westpac, but its Melbourne business unit is on the up following years of decline that, by October 2020, left it down to the bare bones and just 15 staff across creative (DDB), PR (Mango) and digital experience (Tribal) teams. 
• Mike Napolitano made the switch from TBWA to take up the managing director role with eyes wide open to the "rebuild" project ahead of him, with a lofty goal to return DDB Melbourne to its former powerhouse status.
• A people-first approach to leadership and a culture of creative excellence over "social events and beer fridges" was the driver of change, starting with two key hires that backed Napolitano's vision – Psembi Kinstan to oversee creative and Matt Pearce to run planning.
• Structure played a role as well. Napolitano embraced the integration and relatively flat structure adopted by necessity in the trough of 2020 and scaled it up sans siloes. 
• A big sign things were paying off came in mid 2022 when DDB landed a prime position on Coles bespoke shop Smith Street alongside Omnicom media shop OMD. 
• Headcount is now circa 100 and revenue has lifted three-fold. It's still around half of the 200 strong team the agency had in its heyday, but Napolitano says the business is well on its way to "becoming a world class creative business again" – he reckons AI will  accelerate the next stage.

Mike Napolitano doesn’t count himself as someone to duck a challenge. He got one when he walked into DDB Group Melbourne as its new managing director – but says he did so with eyes wide open.

With eight years under his belt at Omnicom sister agency TBWA\Australia, and five and half building a “pretty formidable team” from the MD seat, Napolitano says he was sold the opportunity as a “rebuild” project.

DDB Melbourne might have had “great DNA” and a well-regarded global brand, but it was a shadow of the “powerhouse” it had been just a decade prior.

“It had just... gone off the boil. They’d lost some business, and the focus probably was very Sydney – and rightly so, I think the Sydney business was going very well,” says Napolitano.

Things were dire. A team of “probably two hundred” in its heyday had bled out to 15 across creative agency, PR and social unit Mango and digital experience unit Tribal.

“We needed to take a business with really good bones and great DNA, and put everything that makes a great creative agency back in.”

Easier said than done. But, with the right people, never impossible. Now DDB Melbourne has circa 100 of those people and they are driving business growth. Revenue has lifted three-fold in the last four years and Napolitano says the agency is “well and truly on that trajectory to [becoming] a world class creative business again”. In June, he was rewarded for his efforts and made Melbourne group CEO.

Turning point

The wins started to stack up – Dulux, New Balance, Movember, Asahi, Funlab, Our Watch, AgriFutures, Mr Chens, Acciona and the Victorian Government. But the Coles gig, with DDB pitching alongside Omnicom stablemates OMD and TBWA (and aligning with Deloitte) was the big one.

“To win [Coles] in 2022 then start the agency [Smith Street] in 2023 was a real watermark for us as an agency,” says Napolitano. “Growing that team now, and being able to see how that's impacting the work and the client’s trajectory as well is pretty exciting.”

The bespoke unit is run out of the DDB Melbourne office, where several OMD media talent sit in-house to work on the account. TBWA isn’t involved in the day-to-day, but it’s understood the deal with Omnicom is flexible, so that might change in future.

Deloitte is long out of the picture – at least from an advertising perspective. The consultancy continues to work with Coles separately on technology and other projects.

For DDB Melbourne, it’s meant a bigger slice of the pie, and in turn, a bigger share of the credit. With the supermarket giant finishing the 2024 financial year with $1.13 billion in profit, there’s plenty of that to go round.

Smith Street’s ‘Great Value, Hands Down’ campaign got a shout out in the Cole’s Q4 financial report as one of the key drivers of sales revenue growth, alongside “well executed continuity and collectibles programs and trade events such as Christmas, Easter and Mother’s Day” and “strong growth in eCommerce and improvements in availability”.

But the takeaways for DDB have run much deeper, namely in tightening the bond with OMD. Napolitano reckons that having creative agencies “work with the client and the media agency together is the future”.

“We’re pretty excited about that game changer for data development. Obviously, from scale and all those things, it's grown that business, but it's just given us really sort of interesting and different ways to approach client problems and opportunities and created some new muscle-memory for us.”

People first

Napolitano pins the transformation on what he describes as a “people first” approach to leadership: “If you focus on the people, the money looks after itself”.

That started with bringing in creative and strategic leaders who shared the belief that building a culture of creative excellence and nurturing top talent under that guise would lead to “the most potent outcomes”.

Almost exactly a year after Napolitano walked through the doors, Psembi Kinstan and Matt Pearce were recruited as respectively group executive creative director and head of planning.

Getting the duo across the line was the first big milestone for Napolitano, and one he says has been critical to establishing a flatter structure across the business as it grew.

From the start, he says the three of them practiced “service leadership”. 

From a client perspective, that saw Kinstan and Pearce work hand-in-glove with the most senior people in the business but also down to the middle levels and through the ranks.

“I think that's an exciting thing to watch, when you have leaders in your business that aren’t just figureheads, they're actually on the tools. We talk a lot here about working in-and-on the business,” says Napolitano.

“Yes, we've got be in the business and we’ve got to be here representing DDB and doing what’s right for DDB, but we all work really hard with our clients in the trenches with them as well, which I think is a big difference. There’s no ivory towers here at DDB Group Melbourne.”

Less beer, better work? 

Too much focus on fun without equal emphasis on excellence, per Napolitano, does a disservice to the work. So he set about building a culture that goes beyond “social events and beer fridges”.

“I think a lot of the shine has come off our industry because we've stepped too far away from what made us famous in the first place, which was the power of creativity and how we build that for business, for growth,” he suggests.

The vision for DDB Melbourne was to “do the best work of your career and having the best time doing it”. I.e. make doing great work the underpinning culture of the business.

So far, the team seems to be on the same page – DDB Melbourne is the 16^th top scoring DDB office globally of the 200 that take part in the network’s annual staff engagement survey. It climbed 11 places this year to get there.

Integration by design

The legacy of DDB Melbourne’s 2020 era in one way remains with the business, which was so thinly spread it had been forced to operate across the stream – i.e. integrated.

Rather than build back into siloes, Napolitano ran with the chance to run creative teams horizontally regardless of where the clients belong (DDB, Mango, Rapp or Tribal).

“We don't have a baton hand off. It's one seamless experience from the moment of inception at the top of the funnel, but through to that conversion point as well," he says.

“What I very quickly realised is that I needed to create the environment where it wasn't through necessity, it was through sheer desire and understanding that if we broke down silos and the walls between us we can actually have a much more cohesive way to talk about how we grow brands.”

A bit like the great advertising agencies used to do before media was hived off.

Napolitano says it comes back to the “people first” approach – focusing on “collective growth rather than individual channel growth”. “What's the best experience for our people, and then what's the best outcome that we can have from it?”

Where now?

Now in the CEO chair, Napolitano's more focused on what the “next two years looks like” rather than the “next two months”.

Taking over the day-to-day running of operations is Khia Croy, who stepped in as general manager in May from indie shop Sunday Gravy.  

After a strong growth period, the challenge is always to repeat the trick – and the comps get tougher.

Napolitano knows that pressure is real – but says he’s up for the task and repeats that the strategy is simple: Trust talent to deliver; find more talent.

“Rather than thinking about it as how do we put more money on the bottom line, we bring in more great people with different skill sets and capability that can broaden and enhance the team we've already got – and make the work we do even better.”

Broadening capability naturally broadens the service offering – and Napolitano thinks AI can take significant grunt work, or "redundant effort" away from the talent he has at hand to enable "more valuable creative pursuits".

“I think that's where the opportunity is for our business. While everyone else is running around worrying about the demise of our industry, I'm actually the opposite.

“We've just slowly, over time, taken on and just added to the workload, not considering its impact on the people or the outcomes. I think AI technology will allow us to get rid of some of that or at least create an environment where it's done by machine, which I think is great. It means we’ll have our people focused on what's really important from a creative point of view.”

When your agency is growing headcount rather than shrinking it, such positive thoughts can develop.