Robert Sawatzky
Nov 29, 2018

Starcom chief: “Nobody wants to work with a cloud over their head”

Starcom’s global head John Sheehy speaks to Campaign about the media-transparency probe, consolidation, proving value and more.

John Sheehy
John Sheehy

John Sheehy was named Starcom’s global brand president just over a year ago in October 2017, after serving as Publicis Media’s president of global clients. Currently on a visit to Singapore, he sat down with Campaign Asia-Pacific for a wide-ranging discussion.

We’re seeing more agency consolidation these days, more so with digital and creative recently. But some think media should also be returned to single integrated agencies. What do you think?

From a client perspective, best way to answer that is ‘what are their needs and how do we best serve that’?  Whether that’s at a Starcom brand level, at the Publicis Media level or at the Publicis Groupe level it’s pretty simple the way that we’ve structured it. Any given client will see standalone offerings or combined offerings based on their needs. The model still evolves.

Our focus is really on combining [digital, data, dynamic content and technology to transform businesses] as opposed to combining any one brand to another brand.  Brands also allow us to do that in a non-conflicted way so it’s very important for us to still have that brand agency model.

Do media agencies do a good enough job nowadays of proving their value to clients?

We have to do a better job. We’re in a position to be a dynamic agent of change for our clients. I say that because what we’re all trying to do is identify the right audiences and deliver to them the right experience—time, place, location with the right content and then be able to measure that with a degree of accountability, whether that’s ROI or return on ad spend.

So what we do is pretty straightforward. But the pace of change, the ability to leverage technology to do it demands that we do things in a different way. The idea that you can ‘set and forget’ anything now—a piece of communication, a media plan or dollars—has evolved rapidly in the last couple of years. The ability to adapt media dollars and messaging in-campaign as opposed to six months later, in a predictive way as opposed to a reactive way, is where all clients are looking to get to. So how best we pull our assets together to solve that problem is where we’ll win or lose.

We have to do a better job. We’re in a position to be a dynamic agent of change for our clients.... We’re not doing it perfectly but we’re progressing on it. 

Media is at the tip of that because the dollars are driving us there, whether it’s data to target better or technology to influence how you can reach that target at the right time, place and location. Certainly we have to pair that up with more agile creativity and content, better measurement systems. So we’re not doing it perfectly, but we’re progressing on it and it’s absolutely critical we do that.

What’s the biggest data challenge you have now with clients around the globe?

There are all kinds of challenges. Every client has a different geographical footprint. China has a much different ecosystem than most of the rest of the world, but a very dynamic one. So while we can’t match that up because the sources are different, Alibaba and Tencent allow us to see the future in a more integrated way and apply that to markets such as Europe, US even, to see that end-to-end system developed around ecommerce.

It’s about being able to bring that to a client’s agenda. Take AB InBev in this region. Their roadmap for China looks a lot different than their data roadmap than that for Vietnam. Their US roadmap looks a lot different than that for Mexico. What we try to do in each region is have the right insight to lead them to the right solution. It’s not a one-size fits all, and you have to be able to map it out by market, by client.

Is in-housing a real threat to you, or are clients figuring out how big a job it is?

Across markets and clients we’ve seen examples of very effective in-housing and we’ve seen examples where it’s been experimental and we’ve seen examples where there’s been failure. It’s no different that when you’re taking social or commerce or anything else that’s a core capability to a clients’ strategy to try to develop.

Most of the time there’s a good balance between what we’re trying to build towards and why you want to do that. In the best partnerships it may mean that we embed our people in a client’s business to help guide and accelerate bringing some of those capabilities in-house. And they probably should have those. We’re only one part of their whole marketing ecosystem so to think that we’ll have the answer to everything is a little naive on our part.

We have to prove that we can help [clients] unlock growth and if we can unlock more by helping them take it in-house then that’s where we’ll play it.

At the end of the day, we’re paid on output for our clients, so we have to prove that we can help them unlock growth. And if we can unlock more by helping them take it in-house, then that’s where we’ll play it. But we also have clients that recognise if we have over $79 billion invested in the marketplace, then we get to see across thousands of clients and different models and have a lot of learning experiences we can share with them to drive growth.

Usually when we see the poorer experiments, they’ve taken something in-house that’s not core to their business or outcomes for short-term efficiency's sake or learning experience. It’s all experimentation and it will continue to be. I don’t see it as a threat, but something to learn, apply and move forward.

Why didn’t media agencies move more quickly to react to the ANA report on media transparency before the FBI followed up with its probe in the US?

Transparency’s been tackled head-on across our markets with our clients. Publicis Media has been audited a number of times with terrific impact to our clients’ business and ours. We’ve come out of it on our front foot, able to evolve the discussions, and on many levels it’s helped us get back to how we can add value to clients and get paid for that value.

Nobody wants to work with a cloud over their head.

Transparency is not a dirty word. We see with GDPR, it’s being demanded by consumers, our clients and by us. We’ve tried to move forward openly with our clients, helping to drive the industry towards solving this. Nobody wants to work with a cloud over their head.

With procurement-influenced pitches becoming move competitive and fees under scrutiny, will media agencies be unduly squeezed?

That’s the good side of transparency. We’re in the business to make a fair return with the ability to show the client we can help grow their business and generate that fair return. So we’re entrusted to invest millions and millions of their dollars, and we should be accountable for how that’s delivering results.

The more business results we can show in a much more accountable way, we should be able to charge and make an acceptable margin, and that’s where the conversations are heading. There still is a tremendous amount of pressure for all clients and agencies alike to make that margin. 

Do the agency brands really matter anymore under the Publicis One model for clients? How important is Starcom’s ‘human experience’ distinction going forward?

The brand is absolutely critical to our clients and our people working in them. With Starcom, we’ve been the human experience company for the last 10 years. What’s guiding that is the belief that the alchemy between creativity and more technology unlocks both human and business outcomes. We believe that experiences matter because of that connectivity between what brands want and consumers need.

And that can be compared and contrasted with a very clear Zenith proposition, the ROI agency. We have to have strength of brands not only because what clients buy into, but it’s important when you think of how we manage conflict or how we’re able to differentiate and be distinctive in the marketplace. I think Publicis does that incredibly well with Starcom, with Zenith, with Spark, Digitas and Performics, so that it benefits our clients, individuals and talent. 

But there’s also a changing environment, a need to scale differently and be agile. The thing that allows us to do that is fluidity of leadership that unlocks what used to be seams between these brands. We do it in smart ways, in data, commerce and content capabilities and in shared learning (in a non-conflicted way) and apply it to a client’s need.

What else do you think is important to understand that industry observers may be missing?

When you step back and take a look at all the change for what it is, you get some clarity. If you want to look back at the last 10 years and follow the dollars, 10 years ago the market was 80/20 traditional versus digital.

Think how fast the change has come with Facebook, Google, tablets and smartphones and think about what we had to do to get our people from 80/20 to 50/50 [in just a few years]. We purposefully set up a challenge to have 50% of our revenue coming from digital. It helped to shift the way we thought, acted, trained, recruited and partnered. That was meaningful.

In a world of uncertainty there’s a lot of certainty about where we’re going.

What’s next is three distinct areas that everyone’s racing towards: Data, dynamic content/production and commerce. Digital is now native and these new capabilities are what we were chasing five years ago. [It's] the same challenge we faced with that 50/50 challenge five years ago: we have to equip ourselves, make the right investments, train the right people, make the right partnerships, make sure we deliver that right experience that consumers are going to want in the next five years.

And it’s going to go even faster. 5G’s here, there’s machine-learning, predictive marketing, faster measurement, it’s going to demand that we have more automation, better training, more agility and connectivity.

My point is that in a world of uncertainty there’s a lot of certainty about where we’re going.

This interview has been edited for clarity and brevity.

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