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Leader 1 Jul 2019 - 6 min read

Peter Horgan: why Omnicom Media is trumping rivals...and some

By Paul McIntyre - Executive Editor

Peter Horgan with OMD chief executive Aimee Buchanan Pic: The Australian

Omnicom Media Group's CEO unleashes on the 'shameful' standard of industry debate in Australia (it's a global peculiarity), hungry holding companies and why playing the long, clean game is finally working for OMG. For the record, the media agency model

"There is cause for some shame within the Australian industry. If you look at the US, if you look at the UK, Europe and even Asia, you don't see anything like the negativity within the commentary you see here. Australia is an outlier."

Peter Horgan, Omnicom Media Group

Peter Horgan has been nothing if not consistent. And frustrated. In the early, short-lived days of the a programmatic agency gold rush, where high-margin online media arbitrage was the order of the day for media agency trading desks, Horgan was out in the cold. 

He gives a nod to his former boss, Leigh Terry, now at IPG Mediabrands, as they held a cleaner position than most on the boom well underway five years ago in programmatic buying. 

But instead of it blowing up and over in a short cycle, Horgan was horrified to see operational fudging become all but accepted by the marketing and procurement community. The turning point, says Horgan, was the AANA's Media Transparency forum in Sydney in March 2017, right off the back of some blistering and now infamous industry speeches in the US by P&G's global chief brand officer, Marc Pritchard, about the messy problems in the "murky digital media supply chain". 

It sent rumblings through the global industry although there were still gasps of exasperation in Australia at brazen market behaviour even after the issues were being exposed. 

The lead-up to the AANA's Media Transparency was a tense time. Media agency pressure was building on then AANA CEO Sunita Gloster to tread a soft line and former MCN CEO Anthony Fitzgerald, who backed the transparency event, was under some heat to pull MCN's support. Horgan was the only media agency that fronted up on a panel Q&A for that forum. "I was the only agency person to be on stage because I felt I was in a position where I could talk about media transparency," he recalls. "I felt at the time it was going to be a hostile reception."    

Reflecting on when market momentum began to shift to Omnicom Media Group's portfolio, Horgan says it was Pritchard and the AANA's transparency event. "Marc Pritchard did the biggest favour when he made that rallying call to marketers about the murky supply chain," Horgan says. 

"When Marc Pritchard said for everyone to get in the weeds [on the murky supply chain], it was like someone flipped a light switch. It's given some competitors that were heavily into some of the, let's call them exotics, an impossible thing to replace."

Peter Horgan, CEO, Omnicom Media Group

The long game

Between OMD, PHD and now Hearts & Science, OMG has been on a roll with a long line-up of business wins including Hyundai, Suncorp, Virgin, AFL, Qantas International, Nissan, Belong, Mazda, H&R Block and Fitness First.

Horgan, although concerned about coming across "preachy or smug" to industry, has been busting to get a message out that playing the long, clean game, or perhaps a cleaner game, has ultimately brought some karma for business wins and stability and talent. "I need to call out the consistency and depth of leadership across the OMG brands," says Horgan. "Not just Aimee Buchannan, Jeremy Bolt and Mark Coad but their lieutenants like Mark Jarrett, Kenny Stewart, Laura Nice, Kim Hamilton, Nathan Young and Wendy Gower. Nothing is forever but quality, depth and tenure makes a huge difference for clients and is a standout in market."

Still on the long game thread, Horgan recounts a conversation with a rival agency group CEO a few years back that boasted he would grow 50% that year.

"I fell off my chair," says Horgan. "I said mate if I had 50% up my sleeve I'd make it last five years. Holding companies are by definition, hungry. The job of a local business custodian is to manage that hunger but build sustainability and investment into their own local business. While the whole programmatic arbitrage model was revealing itself, and before it was understood client side, we made a call that this can't last; that you will kill good, lasting relationships off the back of that. But three years later, there were still rivers of gold and we're looking at each other going 'shit, we didn't call that well'. We were being outbid for talent; we were being undercut on fees because people could make it up elsewhere. I think that was the source of some of my frustrations." 

But ultimately, the rug got pulled.

“What we can do is show leadership and challenge our people to get under the hood of stories and issues. We can do that by example. I think there's an appetite at the top and I do think there's an appetite in the middle.”

Peter Horgan, CEO, Omnicom Media Group

Exotic tastes
"When Pritchard said for everyone to get in the weeds, it was like someone flipped a light switch," says Horgan. "We were talking about our supply chain and working media proportions in programmatic for the previous two years and nobody gave a damn. All of a sudden there was genuine interest. The reputational halo has helped us a bit but I think the biggest element of that is how that subsequently affected our competitors. We had no unsustainable component on our P&L that we were trying to back fill. It's given some of those competitors that were heavily into some of the, let's call them exotics, an impossible thing to replace. Again, holding companies will push for on-going growth, they don't like going backwards, so it means entities are unable to invest in their businesses as they should be because they're trying to cover an element that probably shouldn't have been there in the first place." 

Steady was right to call it out. If you look at the US, if you look at the UK, Europe and even Asia, you don't see anything like the negativity within the commentary you see here. It's something we need to collectively address.

Peter Horgan, CEO, Omnicom Media Group

Narkos

Recounting that industry cycle puts Horgan on the whiff of another hot tin can. WPP's acting CEO John Steedman lit a firecracker last week about the state of trade media, anonymous comments and the general level of nark across the Australian industry that Horgan fully supports.

"Steady was right to call it out and deserves all our support," he says. "There is cause for some shame within the Australian industry. If you look at the US, if you look at the UK, Europe and even Asia, you don't see anything like the negativity within the commentary you see here. Some of that may be down to anonymity, some of it maybe just down to how this industry rolls. But it is incumbent upon us and to be honest it doesn't reflect well on the leadership within our industry, and I count myself in that body, that it's been allowed to get to this point. It's something we need to collectively address."

Horgan's resolve is to challenge and encourage the industry's leadership and middle tier to get "in the weeds" on industry themes that matter.

"There’s a whole societal question around how content is consumed but I think what we can do is show leadership and challenge our people to get under the hood of stories and issues," he says. "We can do that by example. I think there's an appetite at the top and I do think there's an appetite in the middle."

"We have an incredible amount of talent and smart people who live an breathe that as their day-to-day job. Click-bait and sensational story lines are at odds with that culture and philosophy in our industry and that's why I'm excited about the opportunity to encourage our people to go under the hood, to go deeper. Mi3 is a shining beacon on the hill in that regard. 

"I think the MFA and trade bodies, working with the content originators, have a duty to encourage and promote more thoughtful debate around the issues within our industry. Confronting anonymous commentary and its propensity to veer towards negativity is something we'll be putting much more energy into."

“The MFA and trade bodies have a duty to encourage and promote more thoughtful debate around the issues within our industry.”

Peter Hogan, CEO, Omnicom Media Group

Bursting bubbles

Still stung from the great days of agency arbitrage and other events, though, Horgan wants to see a mechanism for "calling bullshit on windbag CEOs that are making unscrupulous and unsubstantiated claims that are in a fundamentally different universe" to much of the negativity that prevails across the industry. 

Horgan has a pile of additional big themes to cover, some timely and hugely important for an industry broadly under cyclical and structural change, but that for the next instalment. Time and attention is a luxury and Peter Horgan has taken this week's quota.

Until next week.  

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