Jo McAlister knows her business has been under glaring lights for six months. She’s been telling her team in Sydney and now nationally in her new gig “to keep our eye on what we're doing and shut the noise out because everyone's going to talk – and we've been in the spotlight a lot,” McAlister says. “I look forward to someone else being in the spotlight.”

The ”huge narrative in market” that “Initiative’s over, Initiative’s gone” was being used inside the business to fuel the agency’s leadership team and bench talent to step-up after the high-profile exit of Initiative’s three leaders to Accenture Song. 

McAlister was a 20-year career marketer in the entertainment sector – Seven Network, Foxtel, NBC Universal and SBS among them – before switching camps five years ago to join Mediabrands.

She's now at the helm of a shop that has seen a blistering five year run – which started to slow last year when global accounts such as Amazon and Lego went elsewhere. There’s word that the giant Bunnings media account held by Initiative is in play but neither McAlister or Mediabrands CEO Mark Coad would be drawn.          

“I just want to keep our eye on what we're doing, and shut the noise out,” McAlister told Mi3 on her elevation. She has a plan – the first part is around the culture and “hunger” to return to Initiative’s earlier “challenger mindset”.  

“I just think that we were very successful and often when you become very successful, you think you've got the recipe down pat. We've got to evolve the recipe. That challenger mindset we had – we have the hunger. We’re involved currently with three pitches – we're hungry. Everything needs to evolve.”

Interestingly, as her former bosses at Accenture’s fledgling media unit talk of reinventing the agency model with AI and automation taking over process functions once done by people, there’s a subtle inference that a sweeping back office automation and efficiency program across Mediabrands has been underway for two years and that the Accenture “narrative” was already being executed in the ANZ business.

A massive restructuring and reorganisation of the Mediabrands business globally has been rolling out for more than 18 months – job functions, skill sets and automation are at the heart of the overhaul although McAlister and Coad said the overhaul was still under wraps until a new matrix-style structure was complete. 

Ifs and bots

When asked about the new media agency model being espoused by Accenture Song and whether Initiative needed to adapt, McAlister said; “I love that question. I've obviously read what their new model is but we're already on that transformation phase. We've been on that transformation phase for two years. Pretty much most of anything that was manual is now automated by bots. We've been living that. We've been very focused on getting low value tasks automated so that people in our teams can focus on high value stuff. If anything, we're getting really pointy on some of the ways that we're going to use AI.”

Indeed, an Mi3 industry contributor piece by Mediabrands Chief Operating Officer Geoff Clarke in August talked up the results of an “automation platform” being deployed across the group that used bots to automate 75 per cent of media agency investment workflows.

“Since launching in 2023, the program has reduced employee manual burn by 65,329 hours with the bots completing 158,701 tasks previously completed by agency staff,” he wrote. “Time saved since launch represents circa 36 people and it has allowed Mediabrands to re-allocate resource budget into upper funnel craft specialisation roles.”

Algo games

Next, of course, is the deployment of AI into media investment planning and optimising against business results. The competitive positioning between holding company agency networks and consulting rivals is escalating around AI and automation but McAlister’s global CEO, Dimitri Maex, has already warned marketers of the black box AI products being pitched by the tech platforms – Google’s Performance Max and Meta’s Advantage+, for instance.

“Clients are becoming blind to the actual decisions that are being made,” Maex told Mi3 in June. “So who you target … that's the game of the platforms, to be able to automate all of that with the promise of performance. That's a little bit dangerous, because you're giving up a lot of control. So we advise our clients to game the system ... You've got to game the algorithms.”

For McAlister, the overhaul was  “huge” – there had been more town halls and global briefings in the past 12 months than she has seen in five years with the company. “The reason is we need to change the way we work, to really go to that next level as an as an organisation and be competitive. It’s exactly what we’re doing.”

Accenture 'not ready'

Meanwhile, Accenture Song’s plans to build a full-service media unit under Initiative’s previous top brass – Mel Fein, Sam Geer and Chris Coulter – has landed market interest but caution. Expectations that it would acquire one or several independent agencies to fast track the infrastructure and systems required to deliver on the trio’s strategic reputation and knack for winning new business, appears to have stalled, or been spiked for an internal build. The nascent business is understood to be involved in some larger media tenders although there are reservations until the operation can build and show the agency’s engine room to deliver on the strategic chops of its founding leaders.

“They are going to have to buy something – they’re in market making promises. If anyone lands, it’s going to be very hard to be ready,” said one industry executive with some visibility on Accenture Song’s media unit.

These are my principals...

“The operational competency of an agency is so significant you have to be very careful importing that from international,” said another. “You have two of the best strategic people in the market in Chris Coulter and Sam Geer but you have to wonder in the world of principal-based media trading whether our new reality should separate planning from buying.”

Indeed, broader concerns about agency principal trading deals “killing the industry with short-term greed” blew up earlier this month in this Mi3 story.

There are also questions around how Accenture plans to extract its typically higher margin operating model from a full service media agency business that advertisers and procurement teams have been hacking on fees for a decade. 

Premium v procurement

Accenture Song’s creative shop, rebadged officially this month from The Monkeys to global brand Droga5, can be up to 30 per cent higher in costs than rivals, which is part of its premium positioning. “I’ve never seen a client prepared to pay a premium for media,” one pitch consultant told Mi3. 

Others say they are already seeing procurement teams push for zero agency fees in current media buying contract reviews – the idea is for agencies to take their cut from the deals they strike with media companies to buy chunks of advertising inventory and on-sell to clients. For the bean counters, marketing and procurement look good when it appears media budgets are “100 per cent working media”.

Accenture Song said it would respond to a series of Mi3 questions today. 

Mediabrands CEO Mark Coad would not be drawn on his old team at Accenture Song but acknowledged there had been some challenges across the business. “Lego and Amazon were the big ones,” for Initiative, he said of recent losses. But more broadly the market was alight and back to a pattern of pitches being called in the lead-up to Christmas.

“We’re in a hectic pitching period again,” he told Mi3. “There’s not a holding company in the country not pitching. It’s hyped up, almost back to pre-Covid levels.” 

He said the reality of a more considered, human approach for brands to partners and suppliers was over. “It’s going back to what is used to be,” he said. Mediabrands would finish its annual rate and volume group deals with media before Christmas but Coad suggested aside from some green shoots in some categories, a broader recovery in advertising was unlikely until mid next year.

UPDATE: Accenture Song’s comms has responded to earlier questions, with answers attributed to Monkeys MD, Matt Michael.

• On buying an independent media agency to establish the basic systems and infrastructure required to serve clients: “We frequently consider acquisitions to uplift our capabilities, however, in this instance we decided to pursue a different path.”
• On whether it was still mulling an acquisition? Maybe. "Our intent is to reinvent media and create a new model that is free from the legacy constraints of old systems. If acquisitions make sense in the future we are open to considering them."
• On perceptions it has been slower than expected to be match-fit after hiring Initiative's top management: “We’re on track with our expectations.”
• On when Accenture Song will have a fully operational planning and buying agency: No timeline, essentially Accenture Song has that capability globally and is building it locally "and are on track to deliver for our clients".