Omnicom Media Group Leaders Explain New Agency-as-a-Platform Model
Originally published by Adweek
October 17, 2023 | Olivia Morely
Holding company agencies sprawl, rife with redundancies and complexity that leave clients with questions. While some of its competitors execute mergers to tackle that challenge, Omnicom Media Group (OMG) has found its own solution: the agency-as-a-platform (AaaP) model.
Simply put, the group wants the market to view it as a platform—a multifaceted and flexible organization equipped to address clients’ most complex issues using a combination of technology and tools available across all its agencies.
This summer, OMG formalized its AaaP model by restructuring its new business operations under OMG. Now, when the group receives a new business pitch, network and individual agency leaders approach the pitch strategically, deciding which agency or OMG toolset is most likely to achieve the client’s goals and win the business.
Adweek sat down with OMG Worldwide CEO Florian Adamski, OMD USA CEO Chrissie Hanson, PHD USA CEO Mike Solomon and Hearts & Science U.S. CEO Chris Stanger to discuss how agency leaders collaborate under the AaaP structure, and how the network’s Omni technology makes teamwork easier.
This interview has been lightly edited for length and clarity.
On the AaaP strategy
From a marketing perspective, how do you convey what makes each agency unique relative to its sister agencies?
Florian Adamski, CEO, Omnicom Media Group: The media agencies all have data analytics capabilities, but they are distinct. We start talking about what defines OMD, PHD and Hearts. Then, during the process, clients actually make a decision based on who they want to see, who they want to meet and, ultimately, which type of solution they want to go with.
We’ve had clients that switch lanes [and select a different lead agency] during the pitching process. I think it’s important to keep that fluidity in mind, which this model allows.
Chrissie Hanson, CEO, OMD US: It comes down to orchestrating as a leadership team and ensuring that OMG is supportive. It’s important to clarify the client’s need, like what projects are urgent or not so urgent. When people are good communicators, you find you don’t have many issues at all.
Could leveling up new business to the group level create any bottlenecks?
Chris Stanger, CEO, Hearts & Science US: I don’t see bottlenecking happening at all. It’s incumbent upon agency and network leaders to communicate. We understand what the priorities are at any point in time—we have that two-way communication and support from the network.
The network’s going to give the agency leadership teams what we need to succeed. Ultimately, the network is here to service the individual agencies and address any staffing, resource or capability issues. At the end of the day, we’re all acting as agents on behalf of our clients.
Mike Solomon, CEO, PHD US: The AaaP approach ensures our scopes and models are actually able to flex. The model expansion has opened up the bottlenecks. Now we can build teams and models [using talent and expertise from] across the OMG network.
I think everyone in the industry is trying to do some version of what you’re doing. Some are not doing it very effectively; others are.
Florian Adamski, CEO, Omnicom Media Group: If you collapse everything into one, you lose your edge. You lose the best people because they want the ability to shine. They want to show the world, their clients and their agency what they’re capable of.
It’s almost like a field of flowers. It’s beautiful, but they all want to grow. You need to give them water, and provide enough space for them to get light. If parent organizations don’t give agencies the space, some of them will start to wither and die.
I think everyone here would hopefully truthfully say that they can come in every single day of the week and say, ‘We have an idea. We want to do something different,’ and [Omnicom] would be 100% open to that.
The reason that I personally sit in this chair is not because I’ve been a corporate soldier, but quite the opposite. It’s because I was expressing my belief in how to grow this company in different, probably sometimes unconventional, ways. That has made all the difference with the clients.
It sounds like there is no prospect of consolidation within this media group.
Quite often, merging different agency groups is not necessarily a strategic decision, but a financial decision. You’re looking for efficiencies, synergies, savings. Sometimes these things are hard, culturally speaking.
Speaking on behalf of Omnicom Media Group here, I can tell you that a number of years ago we made the decision to empower our three main brands. We have three bets in the race: They’re called OMD, PHD and Hearts.
You must have—and props go to John [Wren, global CEO of Omnicom]—a system that is very specific on the way leaders get incentivized for partnering. You might have had a great year, but if you didn’t partner, your incentive will not be what you would like it to be.
Can you be more specific?
To be very clear, we determine agency leaders’ bonuses. We are great believers in rewarding agency leaders based on their willingness and ability to effectively integrate into a larger ecosystem. Sometimes collaboration is hard to measure. Doing it right requires leaders that understand our business, how people collaborate with each other and what’s happening at the agency on a day-to-day basis.
On using the Omni platform
Would you or do you currently work with clients that have another media agency of record that maybe don’t like that agency’s tech and want to come and license Omni, or have both tech stacks?
Yeah, we have those clients. That is quite often the case. What happens is that sometimes they’re split regionally and have a tech platform in one market and not in the other. Increasingly (but still rarely) they split the tech platform between certain divisions.
Clients do make decisions on which agency tech platform’s spine they actually want people to collaborate on.
For Diageo, we oversee global, fully integrated media planning and buying. However, given its many divisions, brands and products, it has a large number of creative agencies—Omnicom and non-Omnicom. Diageo decided to name Omni Studio the collaborative platform across its portfolio brands.
A marketer would upload a brief to the platform [and] everybody would see it in real time—all the other partners, including in-house units. It’s a sequenced way of working.
You can also use the Omni technology to bring a group of non-consolidated agencies together.
Fragmentation is the reason for the integration. Every industry vertical has become so fragmented that clients ended up with hundreds of specialist agencies.
At some point, they simply needed to pare back to something that’s manageable. They go to companies like Omnicom and ask, ‘Can you help us to simplify, streamline and make more efficient the ecosystem that we have created?’ By doing that they quite often drop certain specialists, and then they consolidate their business with one holding company system.
Chrissie Hanson, CEO, OMD US: Creative agencies are also in the Omni platform. That makes their work data-infused and sharpened. Yes, sometimes we are helping them interpret some of that, but it’s vast for them. It makes cultural insights specifically (and how you can add them to content and commerce) that much more powerful.