Ben Lilley one year on: Becoming ‘pitch fit’, avoiding mega-mergers and the vision for Hero

A year after Mumbrella's Zoe Wilkinson spoke to Ben Lilley about his return to McCann and acquisition strategy, Lilley reflects on what became of 2020, the launch of Hero, and what lies ahead.

“Frankly I was terrified having just come back into the agency, not just as a leader again but in fact now as an investor and the owner.”

Ben Lilley’s first year back at McCann has been tumultuous, almost immediately coinciding with COVID-19. In some respects, he wishes he’d come back sooner. In others, he imagines what holding off just a little longer could have looked like.

“I came back because I really missed the agency, so much, and I missed the agency world and business,” he says.

“So part of me feels like I almost wish I’d actually come back sooner than I did, but then the other, the investor part of me, wishes that I probably came back a bit later and I could have probably factored in what the impact of pandemic was going to be on not just the business but also my investment.”

When I spoke to Lilley last year he was announcing his acquisition strategy, an effort to create the full-service market leader he felt was missing in Australia.

First up came Red Engine SCC, the assets of which were purchased and rolled into The Red Republic after it entered administration. Then came digital agency JSA Creative, production company Engine Room Productions, and data and tech specialists BBE. And to continue building out those capabilities, Smart was rebooted as a brand innovation consultancy headed up by Dominic Walsh and Bob Price.

Ben Lilley

Contrary to what one might think, Lilley says the onset of the pandemic complicated matters rather than being advantageous for the acquisition strategy. The short-term hits to a number of agencies “[muddied] the picture of the health of each business and the conversation”.

And despite growing industry talk of the advantages of independents, interest in Hero and McCann was still high. As Lilley says “it is very difficult to scale an independent” and, Hero provided the next step for those agencies that were interested.

“The truth is most independents never do it, achieve that scale. And that’s why they either end up selling and rolling into a bigger agency, or the unfortunate truth is most independents just end up winding down in the end and shutting down the business.”

And there weren’t just capabilities that needed to be built out – key positions had to be filled after a number of senior staff left in the weeks following Lilley’s acquisition. Sydney, Melbourne and Brisbane managing directors, Hazelle Klonhammer, Georgie Pownall, and Phillippa Netolicky all departed. Chief strategy officer Fran Clayton went back at DDB Sydney within the month, and the Sydney office also needed to fill the chief creative officer role due to the exit of Darren Spiller.

With the hires of Ben Coulsen, Psembi Kinstan, Roshni Hegerman, Caroline McLaughlin and Simon Gawn joining long-standing staff members Pat Baron and Simon McCrudden, and a number of new agencies under its belt, Lilley says McCann is “pitch fit” again, “primed for much stronger organic growth”.

“Part of the reason that I was able to acquire McCann Australia from Interpublic Group (IPG) globally was because the business needed to be evolved and there was work that needed to be done immediately,” he recalls.

“Our acquisition strategy was also to help really rapidly evolve the McCann business in Australia as well. So, obviously, those plans were impacted to a degree, but they weren’t derailed in any way by the fact we went into a pandemic or even that we went into the various lockdowns and restrictions we had to face. Last year, we still ended up achieving everything that we wanted to.”

In the last year, the industry has questioned the structure of the group, as well as the interaction of McCann Australia and Hero, the new agency network. To begin, McCann Australia operates as an affiliate of McCann Worldgroup, meaning Lilley pays a fee to the global business to license the name and gain access to the international network of capabilities and clients. As a result, McCann is not owned by Hero.

However, Hero sits at the centre of a hub-and-spoke model, with McCann as one of the agencies within its orbit, alongside JSA Creative, Smart, BBE, Engine Room Productions and The Red Republic. Hero’s cloud-based technology platform connects all of the agencies, streamlines client services and integrates the service offerings across the agencies based on client needs.

Lilley says the Hero platform has undone the “legacy systems and operational protocols” established through “60 years of corporate work and development” at IPG since McCann’s 1955 launch in Australia, restructuring the business and improving its internal operations.

Last year’s announcement of Lilley’s acquisition strategy outlined his intention to “maximise McCann Australia’s full-service creative scope and scale by integrating more businesses in creative, data, design, media, technology and PR”. By the end of 2020, the market had Hero, a new network which, on its website, calls itself a ‘post-COVID business model, born out of the challenges of the pandemic’.

Creating this network instead of bolstering McCann itself was driven by two realities of the industry. The first, Lilley says, is that “there aren’t really any agencies that have successfully been able to create a one-stop-shop… with the best in class providers of every marketing communications service that a client needs under one agency banner”. The second is talent.

“There were quite a few global creative agency brands that then merged with their global digital counterparts and so now we have quite a few hybrid agency brands… and you have global leadership saying ‘this is the agency of the future’,” he says.

“Now we’ve merged creativity with technology, and data and direct communications and everything that goes with that. And now we have a wellbeing offering and yet what we’ve seen almost without exception is an outflow of first-class senior talent from those merged operations.

“There can only be one CEO. Or one MD per office or one chief creative officer. Whatever it might be. So egos end up colliding and then of course once the talent leaves, then you start to see the clients leave.”

After a steady year of acquisitions, what’s next for Hero is gathering up some of that untethered top talent and creating what Lilley calls a “league of heroes”, or for those not on-brand, a senior advisory board – drawing them in with the scale of the network and impact they could have, without the full-time commitment of a CEO role.

McCann will also be confronted with challenges concerning its client list. Globally, the agency is facing Coca-Cola’s overhaul of all of its agency partners, and Just Eat, the parent company of Menulog, is reviewing its creative services following a US$8.5 billion merger with Takeaway.com last year.

Off the back of the Snoop Dogg-fronted campaign for Menulog and the local extensions, which proved so important for McCann last year, these international pitches will put the affiliate relationship between McCann Australia and the global network to the test. And in 2021, the addition of local accounts will be crucial for the business.

Much like last year, Lilley would not name any clients he wants to see on the roster in another 12 months’ time. As a matter of fact, he says he doesn’t even remember who the five that came to mind in 2020 were.

“My diplomatic answer that I would have given then, would be exactly the same today.”


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