Here’s a bit of a shock: Initiative Media, once one of the UK’s biggest buying shops, has managed against all odds to retain the £80m Tesco account.
Loss and failure have become such bedfellows of the Initiative brand in recent years it is easy to forget that as recently as 2004 its UK billings stood at about £560m. Had it actually lost Tesco, they would have been reduced to little more than £50m .In other words, the unappetising case for closure (in the UK at least) would have been staring Graham Duff – head of Universal McCann and Initiative across Europe – in the face.
For now, he can breathe a sigh of relief as he considers his options, because at least they are now plural. What he should do with them is less apparent.
Initiative’s account losses in recent times are so catastrophic that they will some day make a case study. Before the recent £75mOrange debacle, there was the £30m e.on account which exited in July; a year before the £45m Johnson & Johnson business went; £80m-worth of General Motors moved in 2006; and, most disastrously, the £195m Unilever account in 2005.
There are almost always mitigating or qualifying reasons for individual account losses, but overall culpability inescapably lies with senior management, doesn’t it? Certainly the tail has been pinned to the donkey as far as Jerry Hill is concerned – under whose watch as UK chief executive all these unfortunate events occurred. He was first kicked upstairs to some ill-defined global planning role, then made surplus to network requirements last September.
The image we are left with is of an affable, but somewhat indecisive, old-time TV sales boss brought in to do a job that was over his head. This analysis, however, is somewhat spare with the complexity of the truth.
Initiative was first and foremost Unilever’s media agency – hardly surprising really, since it evolved out of Lintas in the early Nineties. A series of talented, driven ceos, who included Adam Stanhope and Phil Georgiadis, did their best to disguise this positioning with some impressive “shop front” wins. But the fact is that once Initiative lost Unilever, it was like Hamlet without the prince.
And why did it lose Unilever? Well, a major contributory factor was the negligence of parent company IPG. True, during the early ‘Noughties’ IPG was somewhat distracted by force majeure, in the form of a seemingly interminable financial scandal which had the US regulatory authorities beating it around the head. But that hardly excused the chronic lack of investment in Initiative.
While Unilever was crying out for digital and planning skills to cope with the breakneck speed of media change in the outside world, Initiative remained stubbornly wedded to the negotiation culture that had served it so well in the past.
Ironically, the suppleness with which Initiative has managed to wrest back the Tesco account by undercutting a strong challenge from MediaCom (and possibly others), suggests those negotiating skills still have a valuable role to play. But they have bought Initiative only time, not a future.