Righting the Mediacom ship: The challenges facing Sean Seamer
Sean Seamer has been given the task of rebuilding Mediacom as the agency looks to recover from one of the biggest scandals to hit an Australian media agency. Nic Christensen analyses the challenges facing the new CEO.
It’s been the most eagerly watched vacancy in the Australian media landscape – and now we know Sean Seamer is the man tasked with the huge job of turning around Mediacom’s fortunes.
Seamer
Mediacom has been hit with a perfect storm of problems since we broke news of the TV misreporting scandal last November. It lost its CEO and other top execs, while two of its biggest clients have been shifted to sister agency Mindshare to keep them in the GroupM family. So is Seamer the man to turn the tide?
Who is Sean Seamer?
While Mediacom’s critics will seek to highlight that Seamer was not the first choice (that was Nine sales executive and new ZenithOptimedia CEO Matt James) there is an argument he is perhaps uniquely placed to understand and combat the problems facing the agency.
Kiwi expat Seamer reappeared on the antipodean media agency landscape last year when then GroupM chairman John Steedman asked him to leave Singapore and head up GroupM’s push into New Zealand. But it’s important to note he is no stranger to Mediacom Australia or many of its clients, having been involved with it for more than a decade.
Within GroupM he is the “digital boy done good”, having been head of international digital in London for Mediacom for four years, two years as head of digital in Asia Pacific and for the last four years in key business development roles that have meant he has often been across the Mediacom’s Australian business. He was also at one point apparently considered for a COO role some time back.
Indeed in the APAC role he was often brought in when the agency was pitching to retain business and that understanding of the agency, and in particular its people, will be important in the coming months as he works to raise morale in an agency which has had more than its fair share of bad headlines in the last year.
To quote Mark Heap Mediacom APAC CEO to us in a Q&A he agreed to on the Seamer appointment: “Putting anyone new into such a critical role is always a gamble…The risk with Sean is minimal.
“He understands our business, our culture, our product and he’s well connected internally. He is passionate about the MediaCom brand and from his experience at GroupM also has a good perspective on how the broader group and MediaCom can best work together.”
The challenge
First and foremost, there is the aftermath of the misreporting and ‘value bank’ scandal, which shook not just Mediacom but the whole media/marketing industry. In a nutshell, the agency admitted a group of employees had been forging TV campaign results for Foxtel, IAG and Yum Brands, while an audit showed they had also been selling free bonus air time given to the agency to clients, against internal policies.
The impact of this has been huge across the market. Both Mediacom clients and marketers for other brands have described the whole thing as a “wake up call” and “a shake up” for the industry.
In this B&T video IAG marketing boss Jane Merrick talks about the scandal and the issues of transparency it raised for Mediacom, their clients and the wider industry.
IAG followed Foxtel in moving to sister agency Mindshare.
So clearly Seamer’s biggest challenge is restoring confidence to move past the events of last year.
Talent
With very little to choose between most of the big players on rates and services media agencies are really competing around talent – the business’s biggest assets ride the lifts up to work in the morning and depart the building each night when they go home.
Mediacom has been without a full time CEO since June when Mark Pejic departed abruptly and in the last six months has seen a massive turnover in its top ranks with the CFO, Sydney and Melbourne heads and the lead on key client Westpac exiting.
While Mumbrella does not allege any of these departures were related to the misreporting or ‘value bank’ issues, the result is that Mediacom now has a new younger, and dare I say it less experienced, leadership team.
With promising new blood with the likes of Sydney MD James Sneddon, Melbourne MD Anny Havercroft and Brett Elliott as Melbourne general manager, Seamer will need a firm hand on the tiller to use his experience in guiding Mediacom in evolving its product offering.
And with the agency losing some of those key clients it also begs the question of how much it can afford to pay to compete in the highly commoditised marketplace – where the very top talent can command some pretty large salaries. Especially with Henry Tajer continuing to splash the cask to boost IPG Mediabrands’ ranks.
Under Toby Jenner Mediacom built itself into a market leading force by assembling a strong team with the likes of Mat Baxter as chief strategy officer and Andrew Littlewood as chief data and ROI officer.
The agency will need a strong team with a clear presence in market if it is to change the narrative and wave away the plethora of rivals who are attempting to circle it.
Client retention
This will be difficult as Mediacom’s rivals are currently circling many of their clients in a bid to persuade them to move.
A number of clients including EA Games and Canon have departed while there are pitches for Slater & Gordon, PVH Brands Australia and Carnival Australia (which told us they were pitching then retracted the statement after it appears they neglected to tell Mediacom). News Corp, which announced it was moving to Mediacom from UM on the day the findings of the audit were released, has also since elected to leave its digital with UM.
So far most of these reviews have been on relatively small clients – and in at least one case were related to global alignments – while another was related to the client’s marketing team moving cities.
But there is one account that will likely define much of Mediacom’s future and Sean Seamer’s ability to drive a turnaround at the agency – Westpac.
At present media agencyland is abuzz with speculation that the media account, worth $45m according to Nielsen and more like $70m when digital and all its various brands (St George, BankSA, Rams and BT Financial) are factored in, will pitch in the coming months.
The bank is Mediacom’s biggest client, having been with the agency since 2011, and it is understood that the current contract runs out before the end of 2015.
Westpac also has a new chief marketer with the promotion of Martine Jager in July. She previously headed up the Rams Financial Group but is now also responsible for marketing.
Should a review be called, the risk is similar to the one that Ikon Communications faced last year with the Commonwealth Bank (which Ikon managed to retain), where the loss of a key client could shake marketer confidence and spark an exodus.
And you can be sure that Mediacom and GroupM are currently working very hard to ensure they retain this central client won amid the Toby Jenner growth years of 2011/12.
New proposition and transparency
While at this point the strategy and proposition Seamer and co will build is unclear, one thing that is certain is the Westpac account is where they will be most tested (as if they are not already).
One massive issue it will have to address is transparency and trust. But that’s not a unique problem for Mediacom.
Indeed, Mumbrella is aware of a several rival media agencies who have gone so far as to produce booklets for potential clients specifically highlighting their credentials in the area of financial compliance, transparency and disclosure.
UM’s booklet on “Quality Assurance and Reporting Standards” breaks transparency issues down into five categories: financial compliance, internal audits, processes and reporting, tools and trainings.
UM compliance booklet front cover and contents page
The forward note to “dear valued client” emphasises how: “We have prepared this report to explain in detail the policies and procedures in place at the agency. These standards have been designed to provide the highest levels of accuracy with a series of internal controls to prevent inappropriate practices.”
Forward of the UM compliance book.
Clearly agencies across the industry are now having to openly address transparency issues, even though industry body Media Federation of Australia (MFA) continues to insist their no wider industry problem.
It is a bit ironic rivals are now seeking to press their transparency credentials like this given UM’s parent company IPG Mediabrands, Dentsu Aegis and Publicis Group all declined the opportunity to state their policies on “value banks” (or to use their correct title agency volume bonifications (AVBs)) after the Mediacom scandal broke.
Next steps
Plainly GroupM and Mediacom are going to have to throw some cash at the problems – especially in terms of talent. Unfortunately for them it comes at a time when holding group WPP is tightening its belt globally.
They can only hope that Mediacom’s global momentum – RECMA named it “the world’s leading media agency” in July – can persuade the powers that be will loosen the purse strings locally and invest in a bid to reap rewards later on.
On this question Mediacom APAC boss Heap is clear: “Of course (Seamer will be given scope and budget).
“Our industry is ever evolving and we will continue to evolve with it. In 2016 we will be reshaping our agency operating structure to be even better aligned to the current market dynamics and what our clients want from us.
“This will involve us recruiting more new people with certain skill sets to complement our existing capabilities.”
That’s good news for Mediacom Australia cause if they don’t they risk sealing the agency’s fate from the outset.
Nic Christensen is deputy editor of Mumbrella.
Related content:
- Q&A with Mediacom APAC boss Mark Heap on the future of the Australian business
- The Mediacom furore: the questions facing the industry
- Mediacom misreporting issues explained
- GroupM’s value banks admissions and what they mean
- The debate the media industry needs to have
- MFA says there are no wider industry problems
Excellent piece Nic.
User ID not verified.
The Westpac account also comes with Bank of Melbourne which is being run out of the Mediacom Melbourne office. Would be a big hit to both Syd and Melb offices.
User ID not verified.
Some of the more recently departed senior execs have copped an unfair amount of flak this last year. I’m not saying they were perfect but the problems that have arisen in the last year come from commercial and cultural choices made 4-5 years ago.
User ID not verified.
At least the current Westpac breakup campaign is more convincing thank the NAB one. Haha.
User ID not verified.
Mmmmmm
Maybe the whole ‘value bank’ (kick back) matter across the industry from media owners needs a bit more scrutiny?…..
User ID not verified.
Nic, great piece.
Interesting to see that the chief architect of the value bank in the first place (circa 2005) remains untarnished and seemingly unconnected.
I wonder what would happen if the ANA called in the retired FBI types as they have in the US. Given the global nature of the key players there will have to be some local fallout form their findings…
User ID not verified.