NewsLine Interview: Steve King – Global Head Of ZenithOptimedia
ZenithOptimedia will undergo a fundamental change of emphasis over the coming months as its new global chief executive, Steve King, takes over from John Perriss as head of the world-wide media services company (see ZenithOptimedia Appoints King As Global Chief Executive).
The man responsible for more than £1.6 billion worth of billings in 59 countries around the world, told NewsLine editor, Gareth Jones, about his plans for a gear-change at ZenithOptimedia to focus more on agency partner relationships, key clients and new business.
He said: “We’ve gone through the merger of Zenith and Optimedia over the last few years and that’s been extremely time consuming for our senior people. However, that’s finished now and it’s time to start looking at levering our new management, identity and positioning more effectively. The economic recovery is finally underway and there is a real opportunity to move the business forward.”
ZenithOptimedia repositioned behind the return on investment banner last year in an attempt to provide a more valuable service to cash-strapped advertisers. The move proved successful in bringing in new business after a period of internal focus and uncertainty, but King insists more work still needs to be done.
He said: “We’ve got some really strong, compelling resources in that area but we need to strengthen our return on investment credentials and capabilities. This will mean talking to key clients, stakeholders and those that are actually putting ROI into practice. We need to know how our new approach is affecting our relationship with advertisers, what sort of benefits it is bringing and what more can we do.”
King, formerly chief executive of ZenithOptimedia’s Europe, Middle East and Africa operations, also plans to implement a more integrated communications strategy by working more collaboratively with agency partners both across Publicis Groupe – and with other media networks. The move comes amid increasing demands for a one-stop-shop in the pitch process with clients expecting agencies to demonstrate a wealth of media knowledge, without the need for a string of inter-divisional meetings.
The trend towards a more integrated decision-making process recently prompted rival agency, PHD, to announce plans to restructure its senior management system in an attempt to bring its specialist agencies closer to the main company. Carat is another major media agency to have made moves to streamline its business under a more centralised board (see PHD Restructures For More Integrated Approach To Clients).
King believes integration is the biggest challenge facing agencies in the increasingly fragmenting market place, but claims that few are offering truly joined-up media solutions. He said: “Years ago we used to be a transactional business and then we moved into the delivery of strategic solutions and now we’re looking at integration. In every case we are trying to strengthen our integration capabilities ahead of our competition.”
He added: “If you’re part of a world-wide media group that’s got resources in the areas of digital, data, direct response, online, data management and metric management – then you really should be harnessing those skills for the benefit of your clients.”
King insists that integration is far higher on his list of priorities than a merger of ZenithOptimedia and Starcom MediaVest to form a single, gargantuan media-buying operation. Earlier this year WPP consolidated its buying power with the launch of Group M and Interpublic’s Magna has been firing on all cylinders for some time. Speculation was growing that Publicis was looking to increase its media-buying muscle with a merger of its two most powerful global media brands, but King claims this has been put on hold for now.
He said: “Starcom is a fantastic business with some really strong operations particularly in the UK and the US. Obviously we have looked at creating a Group M type of structure or a Magna-style operation. But I don’t understand those kinds of operations and don’t see where the client benefit is.”
The aggregation of media buying enables agencies to punch above their individual weight in trading negotiations by becoming part of a consortium able to secure massive deals. However, King is sceptical of the benefits and sees more problems than solutions. He said: “In certain markets there are many more benefits to be gained from aggregation of buying, but in other markets that volume aggregation is a disadvantage. You are putting together competitive clients who are not going to appreciate being in the same agency or buying group as their main rivals.”
He added: “At the moment we don’t have any plans to aggregate buying in any of our markets. We will look at this in the future and we’ll do what is best for our clients, but you’re certainly not going to see us setting up a single buying operation at the moment.”
King, who was one of the founding directors of Zenith Media, takes the helm at a good time for the agency, which has spent the last year refining its operating structure following the merger of Zenith and Optimedia in 2001. Perriss has laid solid structural and financial foundations, leaving his predecessor free to drive the company forward at a time when the advertising market shows real signs of recovery.
King is confident that ZenithOptimedia has put its merger difficulties behind it and insists the outlook is improving for communications agencies. He said: “The continual negativity that we’ve seen for the last three or four horrendous years seems to have abated and it certainly seems that pessimism has been replaced with a neutral or positive view. It’s difficult to get much visibility very far ahead, but there is a gradual improvement in the economic outlook of most markets and that has a direct effect on the advertising sector.”
However, King plans to put his twenty years of industry experience to good use by moving forward cautiously. He said: “We are looking to grow our capabilities in the UK market, but it is very easy to lose focus. We are much more likely to concentrate on strengthening our existing operations than trying to acquire external third party businesses. We’ve got some really good skills and some really good people – we need to make the most of these assets.”
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