WPP first announced plans to merge MediaCom and Essence last April, a radical structural change for GroupM to create three rather than four flagship audiences, marrying Essence's digital and data-oriented work with Mediacom's scale and multichannel audience expertise.
Now that the merger has become official, Campaign Asia-Pacific spoke with Rupert McPetrie, EssenceMediacom's APAC CEO, along with China CEO Benjamin Wei about how the merger is unfolding across the region with more than 2500 people in 16 markets and 29 offices, including one of its largest global markets.
Working to balance the business operations and ongoing merger for two distinct but “complementary” agency brands was a huge task, the CEOs say. The pair also discussed the latest trends for agencies and brands in the mainland China market looking outwards, the “talent crunch” for expats in adland across Greater China and need for positive culture during the trying pandemic lockdown period. The interview has been edited for brevity and clarity.
Since April 2022, how have you prepared for the merger on a regional and market level?
Rupert McPetrie: We've been extremely busy. We've been working across all elements of the business to articulate our new vision and proposition for EssenceMediacom - on what it means for our people, for our culture, for our products and capabilities, for services for the future that we will offer our clients, and there's been a lot of work on logistics, IT, infrastructure, office space and a new logo. We've made sure that our people have been part of that journey. They've been part of the creation as founders of this new agency EssenceMediacom. So, people have been busy as well, on top of serving clients, winning new business, etc.
On the subject of clients, we've obviously spent a lot of time bringing clients with us on the journey, explaining what's happening. Firstly, business continuity - we still have a job to do, but also, we've been briefing them on what's coming up, what's next, what's the timeline, and when they are going to start to feel the difference to their teams and their businesses.
Benjamin Wei: Actually, locally in mainland China, I think of the past nine months as a joyful period. In China, we have 22 [merger-focused] representatives, with 11 from Essence and 11 from MediaCom. We've been working like a taskforce, together with smaller groups to get connected with global and regional teams.
We started to collect short interval control feedback from both Essence and MediaCom employees. We collected thousands of responses, categorised all of them and mapped them with small focus groups. Then we decided on what to engage with our regional and global teams.
Our goal is quite simple. What we want is for the global vision and global product to be practical in the China market. China's not an independent market, and we work as a holistic global network.
Did you encounter any obstacles/challenges across Asia or in China in the past year?
McPetrie: We all want to move quickly, and you can imagine the day when we announced the merger back in April 2022. Most clients were saying, “Hey, when? When do I see this? When do I see the benefit?” They want it as soon as possible because it will help drive their business growth. So, I think the biggest challenge we've had has been getting that balance between doing it properly, investing time to do it properly and the speed at which we can go to market. It's a good problem to have because it means that our offer, the opportunity in front of us, is exciting. The way we've managed that is all around how we communicate with our people and how we communicate with clients.
Wei: In mainland China, very similarly, I think the only challenge is time. I wish I had 48 hours in a day so that we can move faster.
So, time is our number one challenge, always. We run orientation sessions and roadshows for our clients to tell them what we can offer eventually under the merger. So far, I think we are in a very good position, because we’ve shared all the knowledge. We’ve shared all the best cases, in terms of different capabilities, in terms of different scopes of work, with our clients. After the merger, we can provide much more comprehensive services in terms of scope to our clients that are really cost efficient and also time efficient.
How is the ongoing collaboration between the two agencies going so far?
McPetrie: I've been really pleased with the collaboration. It's been very transparent, very open and very practical in some ways.
I think that's natural because we are merging two very strong businesses. We go in as equal partners into creating a new agency, EssenceMediacom. So, compared to some other mergers that have happened, there's a real positive feeling.
Where we have had challenges, or we've had to marry diverse opinions, or land on a direction that's worked across our diverse markets and client bases, there's always been a very practical sense of wanting to roll the sleeves up, workshop it, put it on the table and get to a position that we're all happy with.
We never started from zero. We already partnered together as Essence and Mediacom on Mars, on NBCUniversal, and especially on the Google businesses. So, it's not been a meeting of strangers, it's been a meeting of friends.
What would you think Essence will bring into the new agency in China?
Wei: Globally, Essence and MediaCom are two very complementary agencies, so the merger is a very complementary merger. In mainland China, I think the complementarity is even more significant.
From a hardware standpoint, MediaCom has a very strong international client portfolio and 360-degree media planning capability. What Essence is focused on is smaller but integrated - we have creative teams and media teams, and are especially strong in digital performance marketing.
So, the outcome of the merger in mainland China is to strengthen and sharpen the EssenceMediacom capability into more comprehensive services that are really end-to-end, like a full package to our clients. What I'm thinking is not a physical reaction but a chemical reaction.
From a software and mindset standpoint, what Essence can bring to the merger is entrepreneurship. We go for smaller brands that have very good potential, brands that are very young. They don't have too much brand heritage and they start from zero. To build a brand from zero is what we feel excited about.
What makes you feel most stressed and excited as the new CEO of EssenceMediacom in China?
Wei: My answer may be kind of disappointing because I have no stress at all. Essence China and MediaCom China have been very close. Since day one when Essence was launched, I have known almost every team leader from MediaCom. We used to go for pitches and go for projects as one team. We have supported and backed each other up in many ways before, so how can I feel stressed? I just feel happy.
In the special case of lockdown and sudden opening in the Chinese Mainland, what did you do as a CEO to support staff mentally and physically?
McPetrie: Even though we were separate companies at the time, we were doing it at the EssenceMediacom level, also with amazing support from GroupM. We had programmes around how to stay sharp and fresh physically and mentally, and how to continue to engage with teammates and clients, even when we were stuck at home. There were lots of tips for us as leaders on how to stay close to our people, and how to stay engaged and keep the motivation going.
Wei: What we were trying to do is to build confidence - to give everyone hope, to tell them, 'You're not alone. You have hope. You have a very strong company behind you.' Indeed, we supplied food, we supplied medicine, and we figured out how logistics could work during the lockdown with door-to-door delivery to make sure our food and supplies were sent to our employees. We offered consultation services, not just physically but mentally, with a consultation service hotline. We hosted online fitness courses every week and did yoga together. Luckily for us at Essence and MediaCom, our employees are doing very well. Our business operations team has also been doing well despite the lockdown and the sudden reopening. What I tried to manage is our positive and optimistic company culture, although it's not always easy.
Did you feel the pressure of creative talents leaving Mainland China and Hong Kong SAR in the past year? How would you view the future of talent acquisition in China?
Wei: I think the pressure is short-lived. Marketing in mainland China is changing rapidly, and we also need new talent who can adapt to the new environment quickly - they are younger, they are more passionate, and they are stepping out of their comfort zones. That is why we are actively promoting recruitment and training our young people within our agencies. We like homegrown heroes and homegrown talent, and we always focus on new talent in the market.
McPetrie: We've obviously seen some changes in terms of the blend and profile of talent. I think there are fewer expatriates in Greater China than 12 or 24 months ago. But you can look at that through two lenses, one of which is that there's more emerging strong, homegrown domestic talent, which I think is very powerful for Greater China. It's a sign of confidence and capability. But it's also the evolution with domestic businesses growing the opportunity around taking China businesses outside of the market. It's a trend - it's one that we've been championing within Essence and MediaCom separately and now together to develop that China outbound work.
Chinese local independent agencies have been growing rapidly over the past few years, especially in digital marketing. How should international agencies compete with smaller, agile and more localised agencies in China?
Wei: Lots of people have asked this. International 4As and smaller local agencies operate with different models. For EssenceMediacom, we will focus on long-term value to our clients, instead of short-term opportunity. So, this is what we offer that is mostly differentiated from smaller local agencies. We operate our business with a transparency model.
For example, we co-create marketing methodology with platforms like ByteDance. We have the framework and methodology to go to market. Smaller local agencies may not have the capacity or capability to offer similar value to media platforms.
McPetrie: We also have very strong Chinese businesses with whom we partnered to take them global. The work we do for Xiaomi, for example, and the work we've done with Alibaba and with Tencent in the past exported from China are real strengths, particularly for EssenceMediacom. As we move to a more audience-based approach and consumer-based approach to marketing, the ability for 4As multinational agencies to have a consistent narrative with Chinese consumers, wherever they are in the world, is really powerful.