4As Management 2006

MindShare makes its move

By Published on .

When MindShare rang in 2000, the WPP Group media agency already had a firm footing in Europe, Asia and Latin America. In North America, MindShare was casting a long shadow over the region that could finally make it a global company.

But that last leap would not come easily. On the April morning last year when MindShare was slated to move into its first U.S. offices, in New York, MindShare Chairman-CEO Irwin Gotlieb did not find a welcoming committee. Instead, he says he found MindShare's offices still occupied by previous tenants, a floor plan on paper that didn't match reality and a fast-approaching deadline for completing the move into the building within two weeks.

As the physical reality of MindShare's U.S. office was still struggling to emerge, the promise of MindShare was already taking hold. Formed from the combination of the media departments of WPP ad agencies J. Walter Thompson Co. and Ogilvy & Mather Worldwide, MindShare had not yet posted its purple logo on the door when the media agency lured three top executives to hold the office of U.S. president jointly.

BIG SEARS GAIN

MindShare also locked up all of Sears, Roebuck & Co.'s $300 million U.S. media business before the agency had even settled in.

By the close of 2000, MindShare looked right at home on the North American media front-the U.S. contributed more than half of the $2.1 billion in new billings MindShare won worldwide through the course of the year. With about $17 billion in total billings in 2000, MindShare captured the title of world's largest media agency.

For its speedy and successful execution of an impressive combination of resources, MindShare is runner-up as Advertising Age's Media Agency of the Year.

The U.S. rollout of MindShare was no leap of faith. Rather, the company made careful preparations. "The U.S. was the last market to roll out and for good reason," says Jean Pool, president of operations, MindShare U.S. "We probably represent about 50% of the billings in the world, so you don't want to screw up. So we did all of our mistakes in Europe and Asia, got it straightened out and then we rolled out in the U.S."

SMOOTHING WAY

Smoothing the way for the U.S. rollout was the 1997 formation of the Alliance, which essentially allowed the JWT and Ogilvy media divisions to work together before being formally wedded. "We met pretty much regularly from then on, so it wasn't a bunch of strangers we were jumping into bed with. We knew them," says Ms. Pool, who previously directed North American media services at JWT.

But when 1,000 employees moved into shared office space in 10 North American cities last year, the relationship was consummated.

"It always comes down to real estate," says Raymond Simko, president of strategic planning, MindShare U.S. "You can talk a lot about how we're going to integrate this and integrate that, but once you start filling up offices, and people see each other every day and share the same phone system and the same computer system and same stationery, that really forces the integration."

GOTLIEB IN CHARGE

Leading the effort were Mr. Gotlieb, who spearheaded the spinoff in 1993 of U.S. media agency TeleVest from D'Arcy Masius Benton & Bowles; Ms. Pool; Mr. Simko, a former head of media at Ogilvy; and Peter Chrisantho-

poulos, Ogilvy's president of broadcast and programming, who took on the same title at MindShare U.S.

But in November the rollout hit a snag. Mr. Chrisanthopoulos left to join the Azteca America Network, raising concerns about leadership continuity.

Less than two weeks later, however, Marc Goldstein, managing director of GM Mediaworks and a well-respected industry veteran, took over the MindShare post.

"We were tremendously fortunate to have this guy come in when Peter Chrisanthopoulos left. I can't tell you how much of a difference that makes," Mr. Simko says. "Right in the middle of a number of new-business pitches [we added] someone with Marc's reputation and ability. [It] is really unbelievable."

The staff change, in fact, took place in the midst of MindShare's top new-business win of the year. Following a yearlong, on-again, off-again review, MindShare won Unilever's $700 million U.S. consolidated media planning and broadcast buying business in November over Interpublic Group of Cos.' Initiative Media. Other U.S. wins last year included Carfax, EasyEverything Internet cafes and KPMG.

While MindShare's two "legacy" agencies handle the bulk of creative duties for Unilever brands, it was largely MindShare's planning expertise that won the client, a Unilever spokesman says, noting MindShare "had the best strategic media planning credentials."

Though some standalone media agencies provide solely media buying services, planning takes as prominent a role as buying at MindShare. "It used to be the planning department does all the modeling, then comes to us and says, `Go buy it,' " Mr. Goldstein says. "Now we're part of it. When the buy has to be made, we're all in sync, and the decision is sound to the brand's objectives. We're not in silos anymore."

ADVANCED TECHNIQUES

For media planning purposes, 24 employees comprise an internal media research and advanced techniques group. Additionally, MindShare taps into WPP's proprietary planning tools.

Such media planning services are gaining in importance for some marketers. "Planning is allegedly where [media agencies] have their value-added distinction come in," says Jim Dougherty, an industry analyst with Prudential Securities in New York. "If all you do is buy, then it just gets to an unending game of price cutting. Business goes to the people who amass the biggest company with the most clout, and it becomes a commodity game, which rational people don't want to play."

But being big serves a purpose, too. According to MindShare's executive team, scale allows the company to afford its planning tools, better equip staffers to handle clients' consolidated media accounts and give them better positioning with media outlets. "As media owners get larger, you can't be small," Ms. Pool says.

Is a media agency that handles giants like Unilever any place for a small client to be? Carfax, which concentrates its multimillion-dollar media buy in cable and radio, hired MindShare in November. VP-Marketing Scott Fredericks says he feared his company would get lost in the shuffle at MindShare because it's not a large advertiser.

FEARS ALLAYED

"They allayed our fears," he says, "Everything's good so far." Though Mr. Fredericks says a planning department wasn't a top priority in choosing a media agency, he already is seeing benefits from tapping MindShare's planning services. "So far it's been working out quite well," he says. "We might be 25% more effective in media buying this year because of it."

Next tasks for the agency include building out Mr. Goldstein's Unilever team, pitching the Motorola media account and learning how MindShare and The Media Edge-another media agency WPP acquired when it bought Young & Rubicam in October-can improve each other's practices. According to Mr. Gotlieb, that won't include merging the two agency brands. Rather, de-merging-in this case from MindShare's legacy agencies-and the evolution of a new corporate culture are themes that will carry through during the year ahead for the mega-agency.

"The luxury is now we can afford to do what is out of the scope of what a [traditional] agency's media department could do," Mr. Simko says.

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