Features

Stephen Li: ‘I don’t remember the last time I interviewed anyone with a degree in advertising’

In an in-depth interview with Mumbrella Asia's Eleanor Dickinson, OMD's CEO for APAC discusses everything from Cannes to transparency and why media agencies are returning to the full-service model

Over the last few years, we’ve heard a lot of talk about the lines blurring between creative and media agencies. As creative and media seem to be going under one roof again, would you say media agencies have gone full circle? 

“I agree: of course when I started off there were no media agencies. Back then, I was always ‘the suit’; I was the guy who was always saying ‘yes there’s a pretty ad, but look here’s the strategy and the media point of view’. And then of course the two businesses separated. But now increasingly, there is much more of a respect and understanding of any agency that has a firm grasp of data.

“Over the last few years, media agencies have really come into their primacy; if you go to Cannes, it’s still called the Festival of Creativity, but now there is a much stronger media and technology presence. Everywhere you see the likes of Facebook, Google, Sizmek and AppNexus. They are the ones at the forefront of data and are the ones driving the agenda. There are even more and more people like myself who were in creative agencies, and have now moved – or are looking to move – to the media side.

“When you ask them why the answer is usually that without access to data, their capacity to do their job is more limited. What they want is to be liberated by that data and they know they have to come to the media side of the fence. In some ways we are going back to a world of full-service agencies, but the balance of power has shifted. I don’t think it’s a case of say Mindshare replacing Ogilvy, but it’s more in the way in which clients perceive us and the way we work together on certain pieces of business.”

Sir Martin Sorrell recently said he envisioned there would be more industry consolidation, even referencing his own agencies including Ogilvy and Kantar. Do you agree with him?

“Yes, but in a slightly different way. I was in WPP for many years and Martin is obviously a very smart man. But if I’m being honest, every holding company has a different spin. What WPP would call a horizontal approach suits them as they have a lot of companies that need clients. If you can wrap your arms around the clients and sell services across all of [the companies], then why wouldn’t you? It’s good business sense.

“Our approach at Omnicom – and in particular at OMD – is much more about understanding what a particular client’s need may be, and they may not be interested in the whole battalion of services. We are all moving towards a holistic offering; whether that will require more consolidation, I’m not so sure. But it boils down to the fact that clients don’t have any more money to spend year-on-year; they’re not getting any more headcount. Every year they’re having to do more with less and work much harder to grow their market share. And as a result, they need us to provide that consultative umbrella and allow them to have one conversation.

“All the media agencies are evolving; and with people like Accenture trying to muscle in, perhaps we will have to again. And that’s good; who knew three years ago we would be hiring statisticians and engineers, as much as people with ‘media expertise’. I don’t remember the last time I interviewed anybody who had a degree in advertising.”

You left MEC two years ago now. Following the news of its merger with Maxus to form NewCo, are you glad you left there now?

“Well I was glad I moved at the time, otherwise I wouldn’t have made the move. From an outsider’s perspective, I think change is good. If I was sitting at the top of GroupM, it’s a change that makes sense. When you have two large ‘machine agencies’ like MediaCom and Mindshare, and then the two smaller agencies that were struggling to see where the growth would come from, why wouldn’t you put the two together? The challenge now though is differentiating the new offering.

“As agencies it’s hard enough to differentiate. We all have an arsenal of tools, systems and processes and we all say we’re the best. To truly be different is difficult, but to be distinctive, to have character, a personality and a vision is still possible. It will be interesting to see how GroupM creates that difference between its three ‘scale agencies’.”

It’s an interesting time for Omnicom Media Group now that Hearts & Science is on the scene. The global CEO Scott Hagedorn recently said Hearts could come to Asia ‘at a moment’s notice’. How much do you regard its potential entry as a challenge?

“When you’re an agency, like Hearts, that has a very strong relationship with a client like P&G, then you need to be prepared to go anywhere. But as OMG, we are very tight family; we help each other out a lot. If Hearts comes to Asia, they know they will have the support of OMD and PHD. That’s very OMG and something very different to past groups I’ve worked in. We do really help each other out.

“Rather than a challenge, I see it as a real opportunity. While Hearts grabbed a lot of headlines last year, it’s still very young and needs to prove itself. PHD over the last few years has really acquired a little bit more scale. OMD was always the ‘big brother’ and we still are in terms of scale and global clients.”

Speaking of Scott, what did you think of his recent comments at Mumbrella 360 that media agencies have “poisoned the well” of programmatic by not being transparent? And as a result, has it led to clients becoming more hesitant about embracing this “data-driven” world?

“It’s very hard to throw a blanket over [an issue like] that. But it does come back to the quality of your relationship with your clients. With two of OMD’s biggest clients – Apple and McDonald’s – we don’t even mention the word transparency, because the people who lead those accounts are communicating with their clients on a daily basis. The work we do is so hand-in-hand that it’s not even a question. It’s less a case of this being a data-driven age than how strong the relationships are with your clients.”

But has that agency-client relationship got lost in light of the transparency scandals over the past year?

“Well it’s often been said that this is a Math Men world rather than a Mad Men world these days. And one of the beauties of that [Mad Men] era, there was a sense of good old fashioned suiting if I can call it that. Having someone who runs a client relationship like it’s their own business is not something that was as strong as it used to be. Now we allow the technology, the tools and the systems to get in the way of that [relationship] and we’re not always better off for it.”

Moving on, OMD was recently named Media Agency of the Year at Cannes. Given that, how did you then feel when Publicis announced its pullout and WPP said it was to rethink the festival. Did that devalue the award in any way for you?

“The Publicis move is interesting; I’m not sure I get it. To say that you’re taking a year off from something to save money to put into other areas is fine. To say you’re going to focus time and energy on something like your clients and Marcel is fine too. But, I’m always hesitant to say we should stop one thing to focus on something else; the fact is we should be able to do more things at once.

“Ultimately if you’re doing great work for you client, then awards are more than just a pat on the back. If our work leads to great results then that should be celebrated and clients also want to be seen having contributed to fantastic work. I disagree that Cannes has lost its relevance and that we should take a break from it.”

Publicis Groupe did say the move was largely a cost-saving exercise. Do you think Cannes has become too expensive?

“Any festival or awards is as expensive as you want it to be. You can choose to make Cannes a big boondoggle and bring 200 people. We didn’t have a big OMG party; we didn’t have hundreds of people there. And when we were there, I don’t think I had a busier Cannes in terms of meetings. It can be expensive, but it can also be very productive. If you want to see it as an expense item, there are many other things in this business you can look at. We’ll see what becomes of Marcel. We didn’t take time off to develop our system.”

To sum up, post-Cannes what’s next for OMD in the region? What’s the main priority for the upcoming months?

“Going forward, from a talent perspective, I would say we are looking at diversity. And in some circles you get a bad rap for talking about it – people do say to you ‘why are you still talking about that’. But here people talk about diversity as purely a gender equation; it’s a hard one and it’s very important to me. But having a clearer point of view on ethnicity, gender bias and skills orientation and being able to stand up for what you believe in.

“However, we should not lose sight of the fact that gender equality is not something we’ve resolved yet. We sometimes tell ourselves we have because we look at the number of female leaders, and not just in this agency. But that’s not good enough. It’s not enough to say ‘look we have a female managing director’ – job done. It’s not looking at the internal issues that help every female; how women are still struggling to have a work-life balance. We are trying to put programmes in place that help that across our regional offices.

“In addition, creativity and providing that end-to-end solution for our clients is really becoming a focus in the UK and in the US. There we have a division called OMD Creates – our creative hub for EMEA. There we are developing creative work for clients like PepsiCo. That’s something we’re trying to roll-out globally. We’re hoping to bring that here by 2018; we’ll be planning that over the next two quarters. And we’re working on a new brand story for OMD globally over the next few months. It’s never dull.”

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