In October last year our global holding company WPP decided to merge my old agency VMLY&R with Wunderman Thompson and Grey South Africa, creating a big, thumping new agency called VML South Africa. With over 800 people servicing many of the best brands in the country, this was a huge bombshell in the local ad industry.
Or so went the press release. The reality is somewhat more complicated. It has meant bringing together disparate cultures and operations, and some tough client decisions. I receive about as many "congratulations" messages as I get sympathy notes.
This is a captain’s log, as it were, of the journey we are on and the agency we are trying to build, and why. For those who’ve been wondering what it’s like to steer a business through an asteroid field of change, buckle up.
Ready, Aim, Shrink
If the asteroid field metaphor seems overly dramatic, consider that the merger in all its vast complexity, is just one of the upheavals our agency is currently facing. Almost as soon as we got going on designing and structuring our new business, we were faced with the loss of our Vodacom account, as well as significant reductions in other client revenue across the organisation. One of the things about being big is that when things go wrong, the numbers tend to be as big.
Although losing Vodacom had nothing to do with the merger, I’m painfully aware of the optics: oh, they merged and then lost their biggest client. Hashtag fail.
The truth is more nuanced. Vodacom typically puts its work out to pitch every three years and, in fact, three years ago we won it away from the agency it's going back to now. Merger or no merger, this pitch would have happened and considering the frequency with which it changes hands, the odds of retaining it were always going to be 50/50.
Broader Concerns
Of course, as we grapple with these challenges that are uniquely ours, we are also facing the same challenges as the rest of the industry. The struggling economy translates into decreasing budgets for clients who are navigating their own asteroid fields.
And of course, our entire industry is being turned on its head by the advent of the AI age. Building a better mousetrap makes little sense when the mice have turned into robots.
Oh, and top of all of this, our Joburg teams have just moved offices.
So, yes, it’s a lot. All at once. And you reach a point where there’s so much disruption happening to your business, that it no longer makes sense to try and navigate around it or ride it out in any fashion. You just have to go with it. And that’s what we’ve decided to do.
The New New Thing
For this reason, we have the intention not just to build the best ad agency but to build the most progressive agency.
This means in addition to being brilliant at strategy and creative and craft, we must be brilliant at the new services that will define the industry in the years to come.
Essentially, we are building two agencies in parallel: a leading creative agency with the ability to win for our clients; and a totally new kind of agency that leverages the power of emerging technology to fundamentally do things differently. Technology is not a nudge, it's an explosion. It won't influence the industry, it will change its DNA. This is not a wait-and-see moment.
While creative communication is, and will remain, the beating heart of the industry, the fact is that being great at all the emerging marketing disciplines will be equally important. B2B, eCommerce, Creative Commerce, Retail Media, Data and CX are all now either partly or entirely the domain of marketing. That means a modern agency needs to be as good at this stuff as they are at big creative ideas.
Fortunately for VML, both locally and globally, we have deep and strong skills in all of these areas. VML Commerce, for example, pioneered the Creative Commerce field (including launching the category at Cannes) and thus is perfectly suited to look after clients' Commerce needs – including shopper, eCommerce, digital merchandising, loyalty and many other emerging fields.
This ability to show up as contemporary specialists is going to stand us in really good stead as we confront the changes in the industry.
AI, Everywhere, All the Time
Embracing AI is not about getting your people to use some fancy new tools. It's a fundamental change to everything about how we do business. Technology that can generate images we used to create by hand, produce full HD videos that were previously shot, edited and scored by humans, write copy and analyse data faster than any human calls into question a lot of the work our industry does.
Our intentions are to embrace AI aggressively and optimistically. Working with our partners at WPP we are launching WPP Open in the market and are also implementing a slew of AI tools throughout our workflow. AI changes everything and we will be leading the charge.
(An aside: I have been asked to lead the Future Proofing team at the Advertising and Communications Association [ACA] so much more on this to come).
Our New Structure
I will give a brief description of our new business structure because it matters to how we are going to become future fit.
Our model is built on the idea that a big, monolithic agency becomes slow, impersonal and lumbering. We are therefore splitting our agency into multiple "squads". This is an evolution of a system called “Tribes” that we trialled with great success in VMLY&R.
Each squad will have its own name and collection of clients. The goal here is to give our clients the experience of working with a focused and boutique agency where they will never get lost in the scale. Our two creative powerhouses – Grey and The Hardy Boys – will also offer something much more bespoke under those brands.
We are also building what we are calling "craft communities" where we will house all of our skilled specialists who will be assigned to client squads. This will enable us to form strong connections between people doing similar work, manage quality of work and offer growth opportunities to our people.
A new function we're calling "Fluid" will bring together all the people looking after traffic, recruitment, scheduling and so forth who will assign people from the communities to client squads, giving clients access to the best people to do the work regardless of where they find themselves in the organisation.
We have a powerful new Exco in place that has united excellent leaders from our legacy businesses into a single team who have the responsibility to lead and grow the organisation. This team is already up and running and functioning as the new VML leadership.
Global Practices
VML globally has focused its energy on three main areas that group our services: Brand Experience, Customer Experience and Commerce. Both CX and Commerce represent significant growth opportunities for our local business. We are fortunate in having skilled people in both areas and there is a big market need for both these service areas to grow.
Our view across VML globally is that it's the combination of these three that will allow us to drive growth for our clients. It's also a pretty unique angle and allows us to tell a distinctive story about the agency.
Our Vision
To get to this ambitious goal we have articulated our new vision this way:
We are our clients’ creative heartbeat, crafting bold solutions that accelerate their growth and captivate consumers.
So, in a nutshell, for those who were wondering what’s really going on – it’s chaos. But in the midst of chaos there are always opportunities for those who choose to look for them. We are they. And we are grateful to all our wonderful clients and people who are on this journey with us. The year may not have gone entirely as we'd hoped so far, but the opportunity is undiminished, and we are undeterred in our determination grasp it.
