Mi3's top agency and consulting stories of 2022: Perk wars, burnout, holdcos raiding holdcos; consultants picking off martech spoils, the $200bn black hole – and Mark Green resisting David Droga
Rampant wage and perk inflation, poaching and how to get staff back in the office were universal agency themes in the first half of the year, with some big switches at the top end of town while consulting firms continued their own strategic offensives – and counteroffensives. Meanwhile, there appears to be consensus across both media and creative agencies: Marketers, in the main, are rubbish at writing briefs. Mi3's top agency stories of 2022 feature: GroupM’s Aimee Buchanan, Pat Crowley, Katie Rigg-Smith and Maria Grivas; OMD’s Laura Nice, Sian Whitnall and Kristiaan Kroon; PHD’s Alex Pacey; Mediabrands’ Mark Coad, Initiative’s Mel Fein, Magna’s Lucy Formosa Morgan; Spark Foundry’s Imogen Hewitt, Razorfish’s Jason Tonelli; The Influence Group’s Henry Tajer; Accenture Song and The Monkeys’ Mark Green; Dentsu’s Angela Tangas and Patricio De Matteis; KPMG’s Carmen Bekker and Sudeep Gohil; Deloitte Digital’s Joey Nguyen, Steven Hann, Stacey Isaac, Nima Yassini, Damon McMillan and Adam Crow; Sayers’ Justin Papps, Genevieve Reynolds and Nicky Bryson; x1AB’s Jon James; CHEP’s Justin Hind and Gavin McLeod; We are Social’s Suzie Shaw; Howatson & Company’s Chris Howatson; Half Dome’s Tom Frazer; Kaimera’s Nick Behr; Hatched’s Virginia Scully; whiteGREY's Lee Simpson; Hello Social's Yay Xavian; TKR Group's Kirsty Tavae; and BetterBrief’s Matt Davies and Pieter-Paul von Weiler,
It’s just a very different time and what is required is a very different [leadership] skillset as well.
When Aimee Buchanan jumped ship to arch rival GroupM, the knives were out for OMD’s joint CEOs Laura Nice and Sian Whitnall, who stepped up to take charge of Australia's biggest media agency network. “The only way is down,” per one nameless exec. One year on, they’ve so far proved the doubters wrong, retaining Coles and landing the consolidated NSW Government account, where a new behavioural science unit helped nudge the business over the line. By 2025, they’re aiming to launch ten similar new products in a push to break the media agency mould, with CX and UX top of the agenda. Here's the plan.
24.
We’re very ambitious. But ambition doesn’t just come from the numbers. It comes from the type of projects we're doing.
KPMG Customer's former ad agency execs Sudeep Gohil and Carmen Bekker have big growth ambitions for the current team of 250 people.
KPMG’s a little quieter than some of its rowdier consulting rivals – Deloitte Digital, Accenture Song and CapGemini among them – but the firm mid-year jazzed up and expanded its old Customer, Brand & Marketing Advisory (CBMA) unit with 250 people to keep pace. KPMG Partners Carmen Bekker and Sudeep Gohil, former agency execs at JWT, Saatchi & Saatchi, Droga5 and Wieden+Kennedy, say they’re not competing with agency networks and holding companies in the growth areas the firm is banking on. Neither is the rewired practice expecting a hit to growth around customer experience programs from any economic slowdown.
23.
Did we foresee some of the senior exits? Yes, we did. And that's to be expected of any change of this magnitude.
Dentsu tango: Patricio De Matteis and Angela Tangas
Accenture’s point man on the $63m Monkeys acquisition in 2017 and former PwC Customer Experience boss Patricio De Matteis is the new CEO of Dentsu ANZ, cementing the intent of the holdco here to continue its shift to a hybrid agency-consulting model amid a raft of senior and mid-ranked executives exits under former ANZ lead Angela Tangas, now running Dentsu International’s UK and Ireland operations. Tangas, hired from iSelect by another former Dentsu ANZ CEO, Simon Ryan in 2017, has polarised Dentsu’s business and triggered widespread exits as the architect of one of the more aggressive alignments of Dentsu’s global strategy by a regional market. Despite losses of more than $50m over 2020 and 2021, Tangas told Mi3 she had “doubled the enterprise value” of the business since taking the top job in 2019.
22.
This process has ensured we will have one lead, one home and one ambition for the Coles marketing team and will have a structure that moves at the pace of Coles customers.
Coles first store in Smith Street, Collingwood, opened in 1914...Omnicom, Accenture and Publicis all independently proposed Smith Street as their operating venture name
In the end not even a call from Accenture Song’s global CEO and Australian expat David Droga, back down under amid the pitch for the giant Coles media, advertising and production consolidation tender, was enough to snap Omnicom’s tentacles from the Coles Group. A tactical shift mid-review by Omnicom to pull in Deloitte to neutralise Accenture’s broader business and growth transformation credentials appears to have worked. The biggest pitch of the year and a major coup for OMD's new bosses, alongside DDB. Coles CMO Lisa Ronson exited the retailer shortly afterwards.
21.
The journey for each acquisition will be different and at this moment The Monkeys will retain their name.
Local versus global perspectives: Monkeys co-founder and Accenture Interactive ANZ lead Mark Green and Droga5 founder and Accenture Interactive CEO David Droga.
Back in April, Accenture Interactive became Accenture Song, as the marketing services firm culled 40 brands accrued over a decade. But while the $14bn behemoth appeared intent on killing off all brands bar Global CEO David Droga's agency Droga5, Australia's creative hot-shop The Monkeys held out. It's still called The Monkeys, followed by 'part of Accenture Song' in the smallest writing they can get away with.
20.
Influence is at a bit of a flashpoint moment, no different to about 15 years ago, when we were having the same sort of conversations around paid search. It's totally undercooked.
The influentials (L-R): Sharyn Smith, CEO, Social Soup; Henry Tajer, CEO, The Influence Group; Howard Parry Husbands, CEO, Pollinate
Back in March, former global CEO of IPG’s Mediabrands unit, Henry Tajer, broke cover on his next move: Acquiring a minority but “significant” stake in The Influence Group, a venture formed out of one Australia’s largest influencer agencies, Social Soup, and strategy, research and ‘systems thinking’ firm Pollinate. Tajer reckons influence is at a growth “flashpoint” similar to paid search 15 years ago and told Mi3 his sudden ousting as CEO at Dentsu Aegis after 10 months was triggered by how he was addressing “challenges” in the group which became too difficult for his London and Tokyo bosses. Since then, Tajer's hired former Coles and Woolworths CMO, Tony Phillips to spearhead a Melbourne push and claims the firm will see 20 per cent growth in the June half.
19.
We’ve delivered I think the best result that CHEP’s ever had in terms of revenue and profit. Better than 2020, better than 2019.
Peak CHEP? Market conjecture had CHEP’s near decade dream run as over but the agency’s new leadership team has overhauled the one-time agency darling for a post-Chris Howatson era. Unbundled specialist services and creativity for a new economy are key strategic planks for the newly-badged CHEP Network. And if the money coming in is anything to go by, it's working.
18.
Unfortunately, in the media industry, we seem to overvalue the importance of being first and undervalue the importance of being right. Any new information and finding are only as useful as it is useable.
OMG product chief Alex Pacey: Accurate, actionable, measurement critical for brands.
Four questions that will test your agency partner’s true understanding of attention
There's been a lot of noise around attention metrics over the last year or so. But the conversations and understanding of what attention metrics actually represent seemed to be pretty vague. Up stepped Alex Pacey, PHD’s Chief Product Officer, with four key questions marketers can ask their agency partners. He reckoned their answers will be deeply revealing – and this piece certainly got some attention, presumably not just from agencies wondering what questions they would soon be asked by clients.
17.
We are seeing it. It’s a combination of people getting paid above their post – they’re either going to flourish or flame out – and, invariably, people are not only doing their own job but getting dragged down into roles. They don’t get dragged up.
L-R: Mediabrands' CEO Mark Coad, TKR Recruitment's Kirsty Tavae, Mentally-Healthy's Andy Wright, Spark Foundry's Imogen Hewitt.
Back in 2021, Mediabrands CEO Mark Coad warned that “problematic” agency hiring practices would lead to higher rates of burnout – namely staff being promoted too quickly and "thrown in the deep end”. By Q3 this year, surveys and those on the front line of the talent shortage were reporting just that. Kirsty Tavae from TKR Recruitment said three in four headhunting conversations end up talking about poor mental health. The industry's Mentally Healthy survey results show high levels of depression and anxiety, per Co-Chair Andy Wright. It's a challenge unlikely to solve itself.
16.
A lot of these traditional growth hacking channels have been saturated by a lot of these firms… The ones that are trying to use a 2017 playbook to grow in 2022 are failing miserably.
“The problem with growth hacking is that the more people that know about the hack, the quicker that it gets detected by someone and then they clamp down on that," John James says.
Growth hacking was once a favourite term of the Silicon Valley crowd instead of marketing, fuelling the meteoric rise of early tech pioneers like PayPal, Tesla and Amazon. But there’s a fascinating blurring going on, where once successful growth hacks are starting to falter. In fact, they are “failing miserably”, in the words of one-time growth hacker and services marketing advisor Jonathan James. Instead, tech companies – think Canva – are turning to out of home, television, and other traditional media. In most verticals, there’s increased competition, meaning start-ups are rediscovering the need to have a “brand”. Traditional marketing smarts and brand talent are increasingly sought-after, and what’s old is becoming new again.
15.
The conversation around the old Ikon business joining GroupM went on for many years – and one of the fundamental points of resistance was the group trading model. We have a very unique approach to dynamic trading and channel neutrality. So the fact that we've come into the group with that accepted as a non-negotiable demonstrates that this is a different group to what it was five years ago.
Pat Crowley and Aimee Buchanan: Tasked with emerging from turbulence with a smoother, cleaner flight path.
GroupM’s new CEO Aimee Buchanan spent ten years at OMD, trading on transparency and throwing stones at the approaches taken by GroupM and other bitter rivals. Essence CEO Pat Crowley (now boss of EssenceMediaCom) was the ultimate under-the-radar operator while leading Ikon’s CommBank account for 17 years. Now he says grown-up kids mean it’s time to step up to steer Essence through the "turbulence" of a triple whammy agency merger (now quadruple whammy). The two are pushing for greater transparency, autonomy versus group trading deals, and say diversity of media planning and decarbonisation of supply chains are coming into view fast for the Australian market.
14.
Australia’s major agencies are offering more than 10 different types of leave, ‘work from anywhere’ policies, thousands in referral bonuses, more free food than you can eat, in some cases total flexibility and up to five months of paid parental leave to entice workers amid a critical – and deepening – talent crunch.
Mi3 has looked at multiple agency Employee Value Propositions (EVPs), which detail the bonuses, extras and perks they offer.
First it was wage inflation. Then came perk inflation. Australia's ad and media agencies threw the kitchen sink in a bid to attract and retain staff, funding everything from fertility treatment, through gender affirmation leave, to $4000 referral bonuses even for staff who have left. Slumber days sit alongside free financial advice, home office funding and laundry services as agencies vie for talent in a labour market that has never been tighter. With salaries rising, the perks arms race is intensifying. Mi3 prepared a sample of the spoils – with agencies piling in to see what everyone else is offering.
13.
We are definitely seeing brands starting to shift spend to other platforms to achieve more efficiency or to test and learn with newer platforms like TikTok.
A series of reports published by US performance agency Tinuity reveal digital ad prices have risen dramatically over the past 12 months.
This piece was published in August 2021, but saw some long tail pick-up as digital ad prices in Australia – and globally – continued to soar. One digital agency reported hikes of 45 per cent on average – prices in sectors like retail and finance soaring. Another agency has seen some key search terms rising by 1,000 per cent. Digital experts unpacked what they thought was going on, and how Australia's marketers could avoid getting burnt. TikTok, meanwhile, reaped the benefits.
12.
Maria is a unique talent with the perfect blend of EQ and IQ and exactly what Mindshare needs to take the agency into the next chapter.
GroupM chief Aimee Buchanan, new Mindshare CEO Maria Grivas, Mediabrands boss Mark Coad
Aimee Buchanan overhaul continues as GroupM taps Mediabrands for new Mindshare chief Maria Grivas
After taking the helm at GroupM, Aimee Buchanan tapped Mediabrands for a new leader at Mindshare, with Reprise CEO Maria Grivas taking the helm as of October this year. That left Mediabrands seeking a successor to lead its centralised performance agency – and boss Mark Coad convinced New York-based Head of Audience and Act at Initiative, and one-time Cadreon Australia lead, Jessica White, to return home and take the gig.
11.
We don’t want to be the consulting business where the partner wins the work and then disappears.
Left to right: Sayers Brand Momentum's Genevieve Reynolds, Nicky Bryson and Justin Papps.
OMD became the first big alliance partner for Sayers Brand Momentum, part owned by three former PwC CMO Advisory execs (Justin Papps, Genevieve Reynolds and Nicky Bryson) who followed PwC’s ex CEO Luke Sayers and Chief Creative Officer Russel Howcroft across to set-up a Melbourne-based boutique rival to the big consulting groups. They say their hybrid agency model of strategy at the core with alliances of specialists in creative, media and CX is landing in market. Start-ups are particularly strong, where the Sayers Brand Momentum team take equity stakes. OMD's media alliance is only the start – it's going broader to creative and beyond.
10.
There’s approximately $11bn spent on martech in Australia, but statistics from Gartner suggests only around 58 per cent of that is being used. That's a lot of waste. We see a big opportunity by connecting that martech stack into the advertising world.
Jason Tonelli: "We'll do full funnel work, for sure. But digital marketing transformation is something that we're very focused on."
Back in May, Publicis decided to revive Razorfish, a dotcom era digital hotshop mothballed after a series of mergers and loss of identity, now resurrected to tap a multibillion dollar waste of martech investment as brands seek to connect customer experience to the outside digital world. Jason Tonelli for now is leading the push locally, with Performics Mercerbell wrapped into the new-old brand. He sees a major surge in automated creative as marketers bid for personalisation at scale.
9.
Three of Google’s stated four criteria are about money ... Client growth; that is about money. Diversification beyond search, which is maxed out, is where Google sees more money, because it has excess inventory elsewhere, but from a client ROI perspective, it doesn’t perform as well [as search]. Annual ad spend is clearly just about money. Client retention is the only quality metric.
Feeling lucky? Search the Google Preferred directory and find the agencies it says are the top 3 per cent in Australia.
Google in March published an initial list of 79 Australian agencies that achieved 'Premier' status – the top three per cent in Australia, per Google, and a badge of quality assurance for brands that spend circa $3bn on search annually. But there were some notable absences, which caused some wrangling with Google. iProspect and Reprise, two holdco-owned agencies that were notably absent in the first draft were later added to Google's list, along with independents Adcore Australia, First Digital and Indago Digital. Either way industry execs weren't convinced about the criteria used by the search giant, warning it risks unintended consequences...
8.
There was a lot of initial interest and discussion between Cartology and the agencies early on, but agencies were going to treat Cartology’s inventory as they would other inventory. You would expect quality control, metrics, and to evaluate it as they would any campaign ... The conversations went direct from there.
Of the estimated $300 million in revenue Woolworths’ retailer media arm, Cartology, banked last year, just over $7m came from the major media agencies.
Of the estimated $300 million in revenue Woolworths’ retailer media arm, Cartology, banked last year, just over $7m came from the major media agencies. This year, it’s likely to grow, but not by much – as of September 2022, it’s understood SMI figures put agency spend at $5.6m. Cartology has been going directly to brands for ad dollars, leaning on long-standing trade relationships. Media buyers like OMG’s Kristiaan Kroon and Magna’s Lucy Formosa Morgan say they expect the agency pool to grow – but warn more dollars mean higher standards of auditing, benchmarking and measurement within the retailer's walled garden.
7.
It’s not a cost-cutting exercise. The depth that I'm seeing in the MediaCom business fills all the gaps I had in my business yesterday.
Aimee Buchanan, Christian Juhl, Pat Crowley: Merging MediaCom and Essence globally 'solves local talent crunch, adds firepower'.
Pat Crowley was known Mr Commbank, wedded to the tools and a 20-year client relationship. Then WPP folded Ikon into AKQA Media, then into Essence, where Crowley took the helm under new GroupM boss Aimee Buchanan. Then global boss Christian Juhl decided to merge MediaCom into Essence, leaving Crowley heading a 550-strong media agency with close to a billion in billings. A pretty big year – but Crowley said he is up for the challenge.
6.
Give people the option to work whenever, wherever. But make the office and workplace so bloody good that they want to come in.
People are probably bored of talking about it now, but at the start of 2022, agencies were grappling with how to get staff back to work and find a post-pandemic new normal. More than a few agency bosses wanted to get everyone back in most of the time, but couldn't be seen to force people. So how to do it? Let staff write their own rules, or tell them they can work wherever or whenever they want seemed to pay off for some. Chris Howatson, Aimee Buchanan, Tom Frazer, Laura Nice, Sian Whitnall, Nick Behr and Virginia Scully unpacked how they're working in a post-Covid age, without sacrificing culture, development and output.
5.
The consultants are eating the lunch of the larger agency models. The agencies are scrambling to remain relevant. Deloitte spent months with us making sure our people felt safe and valued. That was a real breath of fresh air.
Martech movers, clockwise from top left: Venntifact's Joey Nguyen, Steven Hann; New Republique's Stacey Isaac, Nima Yassini; Blended Digital's Damon McMillan, Adam Crow.
Deloitte’s Australian and New Zealand unit kept the heat on agency holding companies after acquiring three specialist firms in martech and CX – snapping up Venntifact, Blended Digital and New Republique – despite interest from the global communications giants. Along with talent raids on big creative agencies and acquiring Mumbai-based offshore content studio, Madras, the consulting firm is pacesetting with Accenture for tech, UX, martech and creative services leadership.
4.
My fear has been in announcing this to the market that it would pit two women against each other. I adore Aimee. So no, there's nothing there.
News that Mindshare CEO Katie Rigg-Smith was leaving the agency she started at as an intern two decades ago got plenty of attention. She handed over the reins in October to Maria Grivas, stepping up to become WPP's ANZ Chief Strategy Officer.
3.
You have to be able to flaunt what you do … Social media and this idea of ‘wokeism’ has taken over massively, it’s the only way to keep them really engaged in the work.
L-R: whiteGREY's Lee Simpson, Hello Social's Yay Xavian, and TKR Group's Kirsty Tavae.
'Wokeism' works: A recruiter’s agency salary guide – but 'how the f*ck are you going to keep them?'
Talent wars – a recurring theme in 2022 and a current price list for roles from executive recruiters TKR Group demonstrated just how far salaries soared amid a talent crunch, and racked up hits as staffers and bosses eyed what everyone else is demanding to get out of bed. Meanwhile, "Wokeism" has taken over "massively" in the workplace, while one recruiter, TKR's Kirsty Tavae, suggested mentors leaving created a domino effect among teams: 60 per cent of her calls are related to people whose mentor has left.
It’s not rocket science, it’s ‘do I put myself at a slight disadvantage in the transactional stuff but offer more?'
“Like everyone, we’re battling the salary issues. But it feels like the salary issue is not sustainable,” Initiative Australia's Mel Fein says.
Initiative is the first agency in Australia to offer its people free IVF treatment and adoption support, in a bid to create a culture of loyalty, retain its people and avoid incremental wage increases in a tight labour market. But it was also a deeply personal decision for the female leaders at the agency like CEO Melissa Fein, who has experienced first-hand the personal toll fertility difficulties can have.
1.
Agencies are screaming for objectives. We just want to know what needs to shift in people's brain about the product or the brand you're selling that's going to drive a certain behaviour and that's going to drive a commercial goal … The worst briefs anecdotally contain only attitudinal objectives: ’Grow my awareness by 10 per cent’. Okay, what's the bigger picture here? What are you trying to achieve?”
Most read agency story this year was the truth about briefs: They are mostly crap and half of Australia's marketers don't actually know how to write them. The headline findings of the BetterBriefs Project, based on research spanning 1,700 marketers and agencies make for grim reading, with a third of ad budgets being wasted as a result of bad briefs. Unless things improve, marketer tenures – and standing within boardrooms – will continue to decline, and agencies will continue to face-palm on a daily basis. But there are some simple fixes, say Better Briefs co-founders Matt Davies and Pieter-Paul von Weiler – and you can find them here.
Matt Davies (left) and Pieter-Paul von Weiler: Half of Australian marketers have not been trained on how to write briefs, or the briefing process. And that's a problem.
