Oops, first nine words and I've already made a mistake. It's one of the things about IPG, in my experience when I ask someone there who they work for, 99 times out of 100 they will name one of the brands in the constellation of IPG agencies. Once and still venerated brands like Weber Shandwick, MullenLowe, Momentum, Acxiom, Initiative, McCann and others. 1 in 100 says "IPG". IPG, very much like Omnicom actually, remains a literal holding company: owners of others, a thin layer on top, in the rare air and far from clients and your daily challenges to serve them. Actually, this is one of the reasons your business has been sold to Omnicom. So, let me start over.
For the people of the agencies and agency networks owned by IPG, I have two questions:
Yes, more words from someone outside looking in. More advice that you didn't ask for. I just have two questions for you, two questions that I wish someone had told me about when I have been in similar situations to you. Questions I still ask myself today when something tectonic moves. Not questions of you, but questions for you.
You see, I may be smiling in my profile shot, but just out of frame I am covered in the scar tissue that working in this industry gives you. Scar tissue from the wins and losses, from the holidays cancelled, from the political backstabbing, from the scrapping with your sister agency as you fight to share a smaller plate of client revenue. My scars have scars.
I know you have scars too and you will have some new ones from this past week, and are steeled for more in the weeks and months ahead. This isn't just like you lost a pitch to Omnicom, we've all lost and won against each other. This is like you lost a pitch to them, then lost your agency to them.
The first question is this: Is this good for our clients?
"Wait, what? I thought this was about me?!?" You might react and that's fair. But please allow me explain why this is an important question.
I was a client for almost 20 years before switching agency side. In fact about 10 of those years were with The Coca-Cola Company where I partnered with IPG agencies like McCann and Initiative in different parts of the world, and globally, to creatively grow the brands I had the honour of caring for while I held the baton. Coca-Cola was one of those iconic global tentpole clients that quite literally "turned the lights on" in a number of your global networks. Coca-Cola was also one of the clients you lost in the past 3 years. Coca-Cola, and Amazon, and Verizon, and GM, and the list goes on. Fewer tentpoles, long and short.
When I was a mid-level marketer, one of the things I didn't understand was why it was good if my agency was winning new business from others. To me, it seemed that the Creative Director wasn't in my meeting because they were in the war room on a pitch. I didn't get it. I was looking through the wrong end of the telescope.
I didn't understand at the time how the 'flywheel effect', and it's alter ego the 'drainpipe effect', were so very different in this industry. Winners like to work for and with winners. That means that great people want to join the winning team on the ascent, those people then create and protect better ideas for their clients and prospects, so they win more and they grow. This is the flywheel.
The drainpipe effect is the opposite.
These effects happen faster, in either direction, in our industry more than most, because of the impact of talent. The magicians and rainmakers have a scale impact, for both better and worse, when they perform and when they fail.
This then gives us the two times to best sell your agency: in flywheel mode, to get the best multiple based on an estimation of continued growth, or drainpipe mode to find a way to make it stop before it gets worse.
IPG has been sold in drainpipe mode. Which would be OK if it had been sold to a new owner with different skills and different people and a different way of working that can turn the drainpipe into a flywheel. I think we both know that is not what this is. You are about to become a bigger version of you that has more and bigger problems, not fewer and smaller. And your good clients know it.
So back to the question: is this good for our clients?
Does this give your loyal clients a reason to stay? Does this give the clients who are already reviewing your business a reason to keep you, or to go elsewhere? Does this give prospects who are deciding on a new partner a reason to choose you?
It's for you to answer. I'd posit that those answers are no, no and no.
If your answer to this first question is no, then your answer to the second question is less relevant. We are looking for two yeses here, or a maybe and a yes can work. Here we go…
Second question: Would you accept your job?
Whatever part of the company you are in, in whatever corner of the IPGverse, if you were offered your current job to join IPG today, knowing everything you know, would you take it?
More drainpipe effect is coming. Philippe and John have told the street that they are going to find $750m in 'synergies'. 65% of the cost base of your company is people - not factories, not real estate, not expensive distribution networks. Just people. So at least $500m of those synergies will be fewer people working alongside you. The reason they have committed this to the street is that it assuages shareholders as this is value that is being returned to them. It's not value for you, and it is not being returned to clients, and those clients know it.
It's a fascinating time in our industry. There is a lot of focus on how Generative AI and automation are impacting us, plus you have the disintermediation from the platforms and all these other forces. I love it. It is the crucible where we are all tested.
These forces are bad for some, but good for others. Our industry is trifurcating into 3 clusters:
1. Large holding companies that have to grapple with the impact of AI and automation on the enormous media, creative and production machines that they have built with heavy reliance on human capital and way too many client agreements based on reselling the cost of those people;
2. Smaller specialist shops enjoying the renaissance of independents that this same tech is enabling. The same technology that has holdcos cutting means that the barriers to entry and scale for smaller shops are lower than ever.
3. The Goldilocks zone companies, like us at Monks, and BrandTech and Stagwell. Not so small that we can't make our own technology solutions, but not so large and old that we have legacy ways of working to dramatically disrupt within ourselves. Just right.
Put another way, in the first of these you are managing decline, and in the other two you are harnessing growth. How would you like to spend the next year until the sale is closed? And then the year after making your way though as the junior partner in the new megasaur company who thinks that being bigger will mean that the impact of the meteor is less.
Good clients know already that you and your leaders will be distracted by all of this. That your leaders are thinking about their own problems and not the client problems that we exist to solve. They know you will be in integration workshops and not in creative sparring sessions. They know that when someone leaves IPG now they will not be replaced until the acquisition is concluded. Roles that your clients are paying for for work they need done, and they will just have to wait and you will have to apologise for it and work even harder.
So, do you still want the job?
I'm sorry for how this will be affecting your festive period, if you are among the people who celebrate at this time of year. But you have not been sold with the company and choices are yours. Make time to reflect on what you want 2025 to be. We are not saving lives, and this is supposed to be fun to offset so much of the pain. So what's it going to be?
Brandflow is written by Justin Billingsley, who has spent his career on all three sides of the industry's table: senior client, global agency leader, technology founder. First published 16 December 2024 in the Brandflow newsletter on LinkedIn.