Insights27th Feb 2023
“Customers are no longer following a linear path through a funnel”: EssenceMediacomX CEO on merging giants, ethical AI and hidden data gems
It was the “end of the beginning”-- last month saw the creation of EssenceMediacom following a nine month merger process between two major players in the industry, offering next-gen marketing services for a client roster that includes Adidas, Google, Mars, PlayStation, P&G, Coca-Cola and Uber.
All sitting under the WPP umbrella, EssenceMediacom formally launched on 31 January 2023 as a single agency globally but will continue to operate separately in the UK due to client conflicts.
In the UK, the agency that was previously MediaCom will adopt the EssenceMediacom brand, and the agency that was previously Essence will be known as EssenceMediacomX.
Globally, the new agency employs 10,000 people across 120 offices. In 2021, billings for Mediacom were £1.4bn and for Essence were £531m, according to figures from our sister brand Campaign AI, placing both agencies among the top four in the UK market.
In the UK, EssenceMediacom is being led by chief executive Kate Rowlinson, while EssenceMediacomX is led by Ryan Storrar – both were leaders of the two agencies pre-merger. Heading up the global agency is CEO Nick Lawson.
As the new ‘e’ and ‘m’ letters gleam above their rebranded office in Theobalds Road, London, PMW sat down with Ryan Storrar, CEO at EssenceMediacomX to give us an insight into what to expect from a new agency that will combine their performance and branding powers and why he’s thinking beyond the funnel…
Q. This is one of the biggest agency mergers in recent history, but the UK division will have a special status as two agencies, namely EssenceMediacom and EssenceMediacomX - can you describe that for our readers?
“It's the end of the beginning – we've been working for nine months to get to this point. It's exciting now that the prologue is closed and we're ready for what’s to come. In the UK market we are going to be maintaining multiple agencies. Both are absolutely part of the EssenceMediacom family globally, but to really bring the proposition to life in the best way, we need to have multiple agencies in the UK.
“That's for a number of good reasons, but for me it's primarily respecting the success both agencies have had and the growth trajectory that both are on in terms of our clients. The success we've had over here has meant that the UK has been a leading region for the agency and we hope to continue that. So it's very exciting for myself and for Kate as we drive that forward.”
Q. What's been the biggest challenge of an agency merger of this size?
“I think the biggest challenge with anything of this scale is really bringing people on the journey. There's a lot of fantastic and talented people here. That's the biggest thing. Both agencies have strong analytical talent and strong more extroverted thinking talent. What we're getting through this merger is more scaling on those attributes across the organisation.
“If I look at both organisations, Essence came from a place of calling everyone ‘Essentials’ – that real focus on people. MediaCom had a tagline of ‘People First, Better Results’. Fundamentally, those two philosophies point in exactly the same direction. So there's a lot in common in terms of the underlying ethos and ambitions behind the organisations, but I acknowledge that there's some difference in terms of how that comes to life in both the organisations. I'm very much of the view that those differences make us stronger. It creates diversity in the teams and how the organisations come together.”
Q. What are the key ways your clients will benefit with the merger?
“Ultimately what clients are going to be getting access to is everything we're developing across both agencies. That means increased focus and best-in-class use of their data, how we derive insights from that and then utilise that to create innovation in media.
"Looking at how the whole landscape is evolving, delivering best-in-class media with clients is only becoming possible when it's connected with advanced data capabilities and solutions. Technology serves as the connector – in the creative space as well as the performance space. I'm thinking less about media as an individual silo and more on how that gets fused with data technology.”
Q. How have you managed the merger of teams with shared and complementary specialisms within the UK division and globally?
“Because we are maintaining two agencies in the UK, each will have their own leadership. We will have commonalities in terms of the structure and the operating model, but there is full separation as we get into a client-facing side of things. For the network globally, we've benefited from getting access to some of the global solutions, tools and approaches, and vice-versa. We’ve also created an innovation strategy that is making its way into our client base. So it’s a two-way innovation street that’s very beneficial to our clients.
Q. Programmatic (automated ad buying) has been a key calling card at Essence over the years, and now everyone's talking about generative AI, such as ChatGPT. How do you see that disrupting current ad models and the way people search?
“My first thought is that ChatGPT and technologies like this are going to introduce change and enrich the practices in advertising. I don't think it's going to fundamentally rewrite the scripts entirely or that we’ll have a full-on revolution on our hands. The reason I say that is, that generative AI – or AI in general– is already in advertising. We've been on this journey for some time, so I see this as the next stage.
"We need to proceed with an element of caution but I think there are elements that are going to help us. Anything that introduces automation and can help us get to proposed ad copy as an example quicker is a good thing. If it can pick up search trends, look up people, see how people are interacting with content and suggest relevant ads, that will also be an example of something good.
“At the same time, we do need to proceed with a degree of caution because we need to be very cognizant around the ethical considerations that come with generative AI in advertising. We need to be really clear as to the inputs that are being used, make sure that they're accurate and ethical before really unleashing the machines and uncontrolled data. I believe AI is good for advertising but it is only effective with the right guardrails and controls around it.
“At the moment, a lot of our teams are having a lot of fun with it, just seeing what the implications of potential applications have been. There's some exciting possibilities that may help us advance some of our current toolkits. But we're not unleashing anything brand new into the wild just yet because we absolutely have to make sure that the right controls are in place. The topic of ethics in AI is something that we've been pretty vocal and compassionate about for some time.”
Q. What does the future hold for EssenceMediacomX?
“We’re looking at a lot of the shifts happening around the increased fragmentation in social media and the ubiquitous nature of commerce. I'm a very firm believer that customers are no longer following a linear path through a funnel that we've arbitrarily decided for them. I think that's nonsense and – effective immediately, I'm mandating now – I don't ever want to see an upside down pyramid on a slide again! That's just not reflective of the world that we're living in now. As a result, we will have an increased focus on how we create customer value generation for the clients that we work with. “I'm not simply talking about that in terms of brand awareness, consideration and context, because every single engagement with the potential customer is an important one in terms of sales and conversions. It should be around the initial acquisition or growing the value of the relationship the brand has with that customer.”
“You will see how we increasingly put a focus on not just the media aspect of things, but how we are enriching the data sources, connecting that through technology, building relevance through creative service, and all that coming together with the media. That's going to be incredibly powerful for us. So that's how we're looking at helping brands win in that and the new communications economy.”
Q. So, If it's not a marketing funnel anymore, how do we describe the customer journey going forward?
“It has to be more of a loop! The challenge you have is you ascribe events to the ‘funnel’ and you aggregate the data, but if you're looking at averages that really hides the meaningful opportunities for brands.
“We want to be thinking about the different types of cohorts of customers: who's just bought once and potentially lapsing, who's been with me for a while and potentially churning, and then who are the growth segments in between? Who can I maybe move across my portfolio, and service what each of those cohorts require? It’s a more nuanced approach. So increasingly we’re thinking less around ‘everyone must follow this journey for every purchase they make’ because that's just not reality. We're thinking much more around meaningful value propositions and relationships.”
Q. What recent campaigns or work have you been particularly proud of and why?
“What I love celebrating is the things that bring everyone together and the joint wins. I'll give you two or three examples because it's tough to pick one! Our friends just down the road [EssenceMediacom] were very successful in the Flutter Media client win that's been announced recently. It’s wonderful to see the EssenceMediacom proposition really gaining that kind of momentum already. Number two, a little bit prior to that, our retained work with PlayStation which is tremendously exciting.
“And third, of course I’m going to say this, we launched EssenceMediacom and I'm tremendously proud to be one of the founding contributors to that. Just seeing everyone come together in the office last week to celebrate that event was very humbling. It ushers in a new era for the organisation.”