IPG's former CEO Danny Bass on his imminent return, industry viciousness and why LinkedIn is a new problem
Former IPG Mediabrands CEO, Danny Bass, has finished gardening leave and is set for a return. He reflects on six months outside Australia's media bubble; lets rip on the "viciousness" of the local market; says workplace yoga and meditation can only do so much for mental health issues because marketers have a defining role. And why he's worried about LinkedIn and the next generation of talent who don't aspire to climb the agency ladder because they'll be caned by holding companies.
“If you knew nothing about this industry, and just read the trade press or spoke to certain people over the course of a couple of weeks, you would not be coming away thinking, “that’s an industry I want to be part of”.”
Listen to Danny Bass's opinions in no-nonsense northern fashion via the Mi3 Audio Edition. There's two decades worth of media investment nous compressed into 20-odd minutes. Get it here.
Danny Bass has used the six months since leaving IPG to observe the media landscape from outside the bubble.
He’s still off social media, reading long-form content – even print – and has taken the time to reflect on the rights and wrongs of an industry in which, over 20 years, he climbed from the trenches to the top.
As anyone who has worked in Australian media knows, you never really leave.
“I would love to say I have completely detached myself, but you can’t,” says Bass. “Though it’s interesting, you form a different view when you’re not living in the media world 24/7.”
Bass says he will be back in a gig, possibly announced in the next month. But he suggests an outsider looking in to the Australian media bubble could be forgiven for believing it is on its knees, riven by factions, fear and loathing.
“There’s still a whirlwind of negativity around our industry – and I don’t think that [picture] is true, I don’t think that’s the right reflection,” says Bass.
But the longer the tail is allowed to wag the dog, the greater the danger it becomes self-fulfilling.
“I’m very passionate about this sector, the great things we do every day for clients and the role we play in driving the economy forward,” he says. “But if you knew nothing about this industry, and just read the trade press or spoke to certain people over the course of a couple of weeks, you would not be coming away thinking, “that’s an industry I want to be part of”.”
Bass believes “there’s level of viciousness [to trade press commentary] that you don’t see in other markets,” yet is resigned to the fact that “it is what it is, nothing is really going to change”.
But he accepts the media and marketing industry is far from perfect. Alongside agencies, he says senior marketers must help tackle deep-seated issues that fuel negativity and the dog eat dog narrative.
“A marketer once said to me “Danny, I’m basically re-interviewed for my job every three months.“ Unless you are a very strong person who can really stand behind their vision, you’re probably going to default to “Okay, what can we do to put some metrics in there so that when I’m in front of the board, the numbers are looking good.“
Clients: Take responsibility for your actions
“I don’t envy the role of the CMO right now,” says Bass. “In a lot of businesses, the role of the CMO is becoming obsolete,” with very few, if any, sitting on the board.
“So CMOs are becoming increasingly detached from the room where the big decisions are being made and they are being asked to do more every year with less – not just in terms of reduced spend but resource.”
All the while, they face the pressure of quarterly results - the Damoclean sword dangling over any notion of investing for long-term growth.
“A marketer once said to me “Danny, I’m basically re-interviewed for my job every three months“,” says Bass. That ratchets up the pressure to deliver short-term hits and divert budget into anything that can provide a stay of execution.
“Unless you are a very strong person who can really stand behind their vision, their goal of long-term brand building, you’re probably going to default to “Okay, what can we do to put some metrics in there so that when I’m in front of the board, the numbers are looking good”.
The existential crisis facing CMOs therefore fuels the endless pitch cycle, “for no real reason other than, “Hey, I can save some money here,” says Bass. “And I get that. If you’re under pressure, you can put a pitch together and say to the board, “look, we’ve just saved a million dollars on cost.” I don’t agree with that – but I understand it.”
The problem is, when marketers are told to cull resource, the pressure is then passed on to the agency. “The agency won’t get a larger fee to cover those roles. So five, six, ten people working on an account might now be doing the job of 13 or 14. That will never work out in a good way for anyone.”
Therein lies the crux of the issue.
“You can put in as many employee hotlines as you want. You can bring in yoga and meditation five times a day. But that will not fundamentally change the problem. What is required is fundamental change - and that comes back to things like pitching. It comes back to winning business on good terms.”
Yoga won’t solve the problem
Trying to absorb client cost cutting has a direct impact on staff wellbeing. As a result, mental health within media agencies is now a key agenda issue that has started to dominate conference agendas.
Bass thinks the industry is trying hard to improve working conditions, but ultimately, clients have to acknowledge their role and rethink working practices to enable genuine change.
“At IPG, we tried to make it as acceptable as you can to talk about mental health. The challenge – and it’s a big challenge – is how you can fundamentally change your business and the way your industry operates to make that stuff count,” says Bass.
“You can put in as many employee hotlines as you want. You can bring in yoga and meditation five times a day. But that will not fundamentally change the problem. It might put a Band-Aid on it and might make the work environment a little better.
“But if people are suffering from genuine mental health issues caused by workload and pressure and environment then there’s only so much of that stuff that can help. What is required is fundamental change - and that comes back to things like pitching. It comes back to winning business on good terms.”
Agencies can bring in all the best practice and support in the world, says Bass, “but if you have a set of clients that don’t align with it, it doesn’t matter”.
Flexible working arrangements, he says, could help a lot of people, particularly mothers trying to juggle two roles.
“Two days from home, three days in the office or job share – it is absolutely what we need to do,” says Bass. “But it’s interesting when you say to the client, this is how we are going to manage your account … not many will agree to that approach.”
Bass won’t be drawn on whether female marketers are displaying a lack of empathy by frowning on flexible arrangements. He says it is also incumbent on agencies to communicate – and prove – that having two people’s ideas and effort via a job share delivers greater client benefit. “But if you are serious about flexible working and taking stress off people, it means exactly that.”
Train the next generation …
Bass says senior management must also ensure younger managers are equipped to manage teams – both in terms of work and workplace wellbeing.
The reason agencies skew higher for stress and mental health issues, he suggests, may be partially because agencies also skew younger.
“People aged, 24, 25, 26 are getting management positions. We have to make sure they are trained and supported properly, because they are the ones who are managing people who may be suffering. No CEO in the world can walk the floor each day and have a one and one conversation with everyone.”
… or lose the next generation of leaders
Bass, chief investment officer at GroupM before taking the reins at IPG, laments the perception that the investment side of media has lost its draw for young talent.
“It saddens me greatly that investment is not seen as the career within a media agency anymore. We have to work on that, because ultimately, that is what we are employed [by clients] to do … But it’s just not seen as a long-term career any more,” he says. “As an industry, we have to become passionate about investment again, and make investment sexy.”
He also worries younger staff appear to have less ambition to climb the agency ladder.
“I just don’t get the sense there is a generation of people looking at leadership roles as they are today and saying “that’s the gig I want”, says Bass, “and that’s a big problem.”
Given multinational holding companies appear to be intent on tightening the leash, it is put to Bass that the prospect of climbing the ladder only to get caned by overseas executives might not be aspirational for younger talent.
“That’s well articulated,” he admits. “The remit of the local lead is now much narrower than it used to be, and as the local lead you have to sign up for that. You get the badge, you get the gun, and that’s your role. But the generation coming through looks at that and says, “no, I don’t want to do that”.”
Bass thinks the industry needs to better articulate how it can enable the aspirations of younger people in order to attract and retain talent – and get them into a position where they can consider pushing on to the very top.
“In a number of years, you can be pretty much in any major capital in the world. There are few industries that can offer that, and it’s a real selling point for us.”
He likens it to sports management, mapping out a career to maximise individual talent and propel them to the top of their game.
“There is a lot more that goes into running a business now. You have to manage a regional exec, a global exec, to manage the margin you have been given. People expect you to be dynamic, you have to be a good public speaker and you have to be available to talk to people, which requires development of different skills,” says Bass.
“At the same time, you’re talking to media owners and owners of other businesses in what are sometimes very, very intense situations. You have the pressures of the trade press and everything that goes along with that, so you have to be mentally strong to accept that people might write things about you or your business and not react to that. So there is a lot of work to put into a future leader to get them to that position,” says Bass.
“To be clear, we have an incredible talent base who could continue to push this industry forward. It’s our job to make sure they are given every chance to do that.”
"I was part of the team that launched MySpace in Australia. For six months it was standing room only in agency presentations. Then we heard this name ... Facebook. Within six months, we were the ugly kid at the ball, we were gone - and similar things will happen."
Bass on the rise and fall of social media
While brands have dumped cash into social media, Bass is not convinced all platforms add value – at least from a personal perspective.
He quit social media “four or five years ago” and hasn’t looked back.
“I was never a massive user … more of a watcher than a poster,” says Bass. “I thought, what is this adding to my life, was it positive or was it negative? It was probably changing my behaviours in ways that I didn’t really like. So I just thought, “well, I’ll switch it off and see what happens”. And it’s like a drug, because you then try to find things to replace it, so you find you are looking at new sites a lot more,” says Bass. “So it wasn’t an anti-Facebook, anti-Instagram [protest], or anything like that. It was more “is this behaviour adding something positive – and I decided it was not.”
LinkedIn, he suggests, is the home of banal positive sentiment and the social media channel should probably ban, or at least trademark, the words ‘thrilled’, ‘honoured’ and ‘excited’.
“The joke is like it’s Facebook with a tie, where people are sharing stuff now that doesn’t really need to be shared - but I can see why they’re doing it because they need that gratification of a like or a share or a comment saying “that’s amazing”.
Bass also suggests ditching social media is not necessarily a disadvantage for media agency leaders.
“You have people to do that [for the agency]. I don’t listen to regional radio or see a billboard every day. You need to have a good view on everything that is going on – but you don’t need to be an expert on everything.”
He says right now agencies are all over TikTok, but, from painful experience, warns marketers not to get too excited.
“I was part of the team that launched MySpace in Australia,” says Bass. “So I know how quickly a social media platform can rise, then quickly become uncool and disappear.”
Launching MySpace, was “an incredible six months, it was standing room only in agency presentations – even creative agencies would see us and want to be part of it,” says Bass. “And then we heard this name … Facebook. Within six months, we were the ugly kid at the ball. We were gone within six months. It was incredible - and similar things will happen.”
Personally, however, Bass sees Instagram “as an incredible platform for brands”.
“That’s not the influencer aspect, which I see as separate, but I think Insta Stories - as they move more into e-commerce and the ability to watch and buy and interact within the platform - will become way more powerful than Facebook as an advertising platform.”
"In the US, a lot of the Democratic candidates are talking about breaking up big tech. It’s going to take something like that to slow them down. It isn’t going to come from agencies and it’s not going to come from advertisers."
On the future of TV
Bass had one or two frank exchanges with media owners during his tenure at GroupM and IPG. Media agencies are contractually obliged to drive a hard bargain, says Bass. But the point at which all the fat has been trimmed “is probably not too far from today”, he admits, with TV a prime example.
“The challenge is the infrastructure cost. The cost of running a network has not got any cheaper than it was ten, fifteen, twenty years ago. It has probably gone up,” says Bass.
“Twenty years ago, if you look at top ten rated shows outside of news or sports, a high proportion would be foreign imports. Friends, Desperate Housewives, whatever it is, they don’t rate anymore because people are streaming them. So you have to produce more local content and that is invariably more expensive … and the audience is decreasing.”
Clients then take a view: “Well, we are paying more to reach less”, says Bass. “That’s not getting into the brand building argument, that is simple economics when it comes down to a pitch.
“So given the structural challenges that TV networks have, if they’re to be helped or saved by advertising, then the model needs to change. Because every year there’s more choice to invest client spend, more choice in terms of obvious ROI.”
TV, and traditional media more broadly, says Bass, “have done an incredible job” given the increasing strength of multiple headwinds.
While new Seven CEO James Warburton last week dismissed talk of “doom” for traditional media in the face of Big Tech, Bass thinks the comments Warburton was referring to – those made by former MCN CEO Anthony Fitzgerald - may have actually been undercooked.
“There’s an 18-wheel truck with the name Amazon on its side. Behind that there’s two tanks, one Facebook, one Google. Then behind that there’s an army of tech – and that’s a hard thing to stop,” says Bass. “It’s only going to get harder.”
However, he says the US elections and increasingly stringent European legislation – and maybe even Australia’s own regulators – may offer traditional media a glimmer of hope.
“In the US, a lot of the Democratic candidates are talking about breaking up big tech.
“We’ve seen that in Europe, particularly France and Germany and they’re going toe to toe. It’s going to take something like that to slow them down. It isn’t going to come from agencies and it’s not going to come from advertisers. There may be advertiser boycotts if certain things happen again, but the only thing that’s going to slow them down is [regulatory] change.”
"Ultimately, if you’re a client of big tech Company A, if you’re an agency of big tech Company A, over time they will take more and more of what you do in-house."
...and whether agencies should fear the FAANG's bite
Should agencies be worried about the knock-on effect of big tech outgunning traditional media, given most of the big platforms are increasingly self-serve and have the tech, data and resource to place and optimise their own spend?
“I think agencies are probably more protected in the short term as those tech companies are still spending, says Bass.
“But ultimately, if you’re a client of big tech Company A, if you’re an agency of big tech Company A, over time they will take more and more of what you do in-house,” he suggests.
“But the media agency industry has an incredible way of being resilient,” says Bass.
“For everything that has been said about media agencies over the last few years – and there has been a lot – most of them are hiring more people than they have ever hired before, most are growing and most of them are investing in tech in a way that shows they are going to be around for the next few years.”