Not Just The Ads
DAVID KERSHAW
Chief Executive, M&C Saatchi plc
NOVEMBER 2007 Introductions
• Steve Martin (CEO) M & C Saatchi Sports & Entertainment
• Melvin Jay (CEO) Clear Ideas
• Jane Boardman (CEO) Talk PR
• Phil Georgiadis (Chairman) Walker Media
November 2007 The Growth Strategy
• Extend traditional businesses into new geographies
• Shift balance of the Group into higher growth / margin categories Sub-Sector Operating Margins
20
18
16
14
12
10
8
6 July 07 4
2
0 Advertising Media Buyers Design DM/Sales Public Digital Promotion Relations
November 2007 Source Wks.2007 Key Steps In The Rebalancing Strategy
YEAR EVENT
• 1995 M & C Saatchi Founded
• 1998 Walker Media Launched – 50/50 Joint Venture
• 1999 LIDA (Direct Marketing and Digital)
• 2000 Immediate Sales (Integrated Communications)
• 2001 Talk PR
• 2003 Influence (Cause Related Marketing) Key Steps In The Rebalancing Strategy
YEAR EVENT
• 2004 Acquired additional 25% stake in Walker Media
• 2004 M & C Saatchi Sport & Entertainment established
• March 2006 Walker – I (Digital Media)
• July 2006 Open Dialogue (PR-Sydney)
• June 2007 Me And Us (PR - Paris)
• July 2007 Acquired additional 19.5% stake in Walker Media
• July 2007 Acquired 100% of Clear Idea’s Ltd.
November 2007 And The Balance Is Shifting
Group Revenue 2008 - Group Revenue 2006 - Group Revenue 2007 - By Source (est) By Source By Source 0% 6% 13% 21%
20%
23% 49%
14 % 58 %
65% 16 %
Advertising Advertising Advertising 15% Media Media Media Ot her M ar Com Other Mar Com Other Mar Com Co nsult ing Co nsult ing Consulting The Role Of The Group
• A home for Entrepreneurs not ratio-slaves
• Increasing opportunities for shared clients
November 2007 The Future
• Will continue to invest both organically and through acquisition in selected high growth / high margin businesses
• Will explore further geographies – E.g. The Middle East, Central Europe
• Outlook for full year and 2008 consistent with expectations
November 2007 November 2007 May 2004 to present day
The story so far… CONTENTS
WHAT WE DO
WHO WE WORK FOR
HOW WE GO ABOUT IT
GROWTH FROM STANDING START
2007 WINS
CREATIVITY
360 DEGREE THINKING
FUTURE GROWTH WHAT WE DO
Award winning dedicated sport and entertainment sponsorship exploitation agency
In layman's terms, we make a brands’ sponsorship more famous and effective using tools such as PR, events, digital & direct to consumer
Senior team of 25 experienced sports and entertainment specialists
Every single person in the company has been recruited on spec for specific client needs
“few sponsorship agencies can claim to deliver on the promise of integration, but M&C can. It’s success in pitching, winning & implementing contracts – fending off stiff competition – is based on comm
every level of the consumer contact”
unicating the sponsorship at WHO WE DO IT FOR REVENUE GROWTH (YEAR ON YEAR)
38% 48% 57%
2005 2006 2007 NEW RETAINED CLIENT WINS ORGANIC CLIENT WINS CREATIVITY
Four examples of creativity from 2007 to showcase breadth of work:
1. Amelie Mauresmo splits the court in two
2. There are two people in everyone – Reebok brand launch
3. Live streaming from the BAFTA red carpet
4. The first footballer in the world to have his own TV channel – Frank TV AMELIE MAURESMO SPLITS THE COURT IN TWO
The Brief With 48 hours notice, Reebok briefed M&C to create a newsworthy stunt to generate pre-Wimbledon coverage of the brand’s sponsorship of tennis star Amelie Mauresmo.
Our approach We needed a concept that would create strong, branded imagery for print and broadcast media. To achieve this, M&C staged a game of tennis with a difference… We created a full size tennis court split across two rooftops in London. Consumers and international media were invited to take on Amelie, the defending Wimbledon champion, in an unforgettable game of rooftop tennis. AMELIE MAURESMO SPLITS THE COURT IN TWO
The Results A truly global news story with 130 TV shows around the world featuring the stunt including the BBC, CNN, Sky News, Al Jazeera, Canal+ TV5 and Eurosport.
The story was also widely covered in newspapers and on websites across Europe. REEBOK BRAND CAMPAIGN LAUNCH
The Brief Reebok briefed M&C to develop a concept to launch their ‘Two People in Everyone’ global campaign and generate pan-European coverage. The campaign celebrated the differing on and off-field personas of several Reebok sponsored athletes including footballers Thierry Henry and Iker Casillas.
Our Approach M&C commissioned a series of ‘shadow sculptures’ designed to reveal the athletes dual personalities in an engaging way for consumers and media. Each sculpture was made up of a seemingly random array of objects that represented the ‘off field’ personality of the icons. However, with the flick of a light switch they took on a new dimension as the objects had been carefully assembled to cast a shadow showing the silhouette of stars in more familiar ‘action’ poses. REEBOK BRAND CAMPAIGN LAUNCH
The Results The sculptures were unveiled to European media at an exclusive Barcelona art gallery by footballers Thierry Henry and Iker Casillas.
Branded TV, print and online coverage received throughout Europe including L’Equipe, BBC, Eurosport, Daily Mirror, Marca, Bild, El Mundo, Sky News and Antenna 3. THE BAFTA RED CARPET
The Brief Orange briefed M&C to make its British Academy Film Awards sponsorship more relevant to its core target audience of 18-24 year olds.
Our Approach M&C realised that the rather formal BAFTA ceremony wasn’t necessarily of interest to the audience. However, the glamour of the red carpet activity before the event provided a real opportunity to appeal to the target’s desire for celebrity news and gossip.
Inspired by this insight, M&C created the first ever programme to be broadcast live from the red carpet of the BAFTAs.
M&C negotiated a deal with Myleene Klass to be the presenter as well as signing her to promote the programme in the week leading up to the show. The show was broadcast exclusively on Orange’s website. THE BAFTA RED CARPET
The Results 10,000 viewers watched live streaming of The Red Carpet Programme – exceeding Orange’s targets.
80% of those viewers watched the entire programme.
Branded media coverage ran in a number of UK media outlets during the week leading up to the ceremony including the Daily Star, Closer, the Daily Mirror, Daily Telegraph and The Guardian
Following on from year one success, Orange has re-commissioned the show to run at the 2008 BAFTA ceremony. FRANK TV
The Brief In August 2007, Orange approached M&C to raise awareness and increase traffic to Orange mobile TV service whilst promoting the brand’s sponsorship deal with Chelsea and England midfielder Frank Lampard.
Our Approach Showcasing the existing product would not generate enough awareness as the service had been launched 18 months before. New news was required. M&C created the first ever TV station dedicated to a footballer – Frank TV. The channel was available exclusively on Orange TV and featured fly-on-the-wall content of Frank Lampard, filmed on his mobile phone, as he went about his life as an international footballer. FRANK TV
The Results The channel proved hugely popular with Orange’s target audience of 16-24 year olds thanks to its combination of celebrity, sport and reality TV style content. It became one of Orange’s most popular channels during the month it was launched.
Media coverage of Frank TV generated 166 pieces of coverage including highly branded coverage on Channel 4 news, BBC Click and Sky News
Coverage achieved an AVE of £4,428,000 ROI of 221:1 FUTURE GROWTH
London 2012 Olympics
World Cup 2010
UK World Cup bid
Entertainment
Continued organic growth
Continue to work closely with Group companies
What we do: we are an ideas company
We are a strategic marketing consultancy …that helps our clients to uncover , craft and generate big ideas that grow their brands and their business. ..which in practical terms means that we help our clients in several ways
Innovation strategy & idea generation
Breakthrough brand strategy, portfolio strategy & brand positioning
Growth mapping and strategic segmentation
Deeper insight into consumers, markets and brands...both qualitative & quantitative
Marketing capability development: process design, training & brand engagement
Graphic Design: radically relevant pack & product design We work with some of the biggest companies, across a variety of sectors Our vital statistics
Geography
Richmond, UK Amsterdam New York
People Money Age
Turnover of £13m 80 people Profit of £3.3m 5 years old EBIT = 25.5% Who do we compete with? What makes us different?
The insight behind our brand... “Great ideas are a mix of insight, strategy, creativity and comme rcial pragmatism...when I choose a marketing consultancy I always have to make a compromise between these ingredients...because none of my agencies are great at all 4 thi ngs ”
Breakthrough Insight
Commercial Pragmatism Strategy
Creativity … as one client put it …imagine the left hand side of your brain shaking hands with the right!
Data analysis Breakthrough Insight Creativity Strategic thinking Expansive thinking Visualisation of ideas & concepts growth map
Natural Fat/ weight Global % T otal Uninvolved Compromisers Indulgers Gourmets Health Seekers Providers Conscious Unweighted Base 6 0 43 12 9 15 2 0 19 13 12 Weight ed B ase 6 0 43 10 6 15 2 0 19 15 15 ‘Muse Affordable all rounder 16 4 1 3 3 3 2 1 10% Taste made easy 11 110% 1 2 2 110% 2 1
Real taste enjoyment 21 2 112% 5 5 4 2 2 15% Wholesome enjoyment 13 1 1 2 3 3 1 1 Books Show I care 7 1 0 1 2 2 1 1 8% Good impressions 7 1 1 1 2 2 1 1 TE Purer pleasure 5 0 0 1 1 1 1 0 CH Weight control 9 0 0 0 1 1 3 2 N 12% G O Proactive health 11 0 0 1 1 2 2 5 GY LO PA O Creative Alch NEL Extrovert/ Enhancing life emy Panel y ESCAPE eativit No rules cr M More ³form or FREEDOM indivi Break rules e dualis EXPLORE co Adventure tic, ll libera Caring Caring NURTUREBELONGec TRUE ENJOYACHIEVEtingCREATE Journey Mapping Care Bondingti Intimacy Happiness Fulfiland Passion Duty Securityve play AccomplishpassioLiberation me For & nate esc CONTROL ap Autonomy More ing istN PRESERVE p staid oty ur Tradition / heritage rot ing forms pid P otyp tu t PROTECT Ra of d Pro ri Regulate / conform pi Introvert / Serious expres Ra ng sion a and nd achie pr veme ot nt ec ti ve Growth outlook: continued double digit growth
Continued growth from UK and Europe
- We have a very wide source of business: marketing and management consultancies, market research and advertising agencies …and strong points of difference against each - Our awareness and reputation continues to grow - Europe growing strongly with lots of new client/service opportu nities - New focus on service brands (financial, leisure, retail etc) - Client sharing/cross selling with M&C (=a big profit opportunit y) Geographical Expansion
- USA is big and underdeveloped market for consultancies like Clea r - US office launched in March 07 …..lost money at the rate we expected for the first 6 months ….. now making very good profits . - Looking east...Singapore, China, Hong Kong, Australia leveraging M&C ’s existing people and infrastructure MYTHS REALITIES GROWTH
22nd November 2007 www.talkpr.com MYTH 1:
‘PR = PRESS RELEASES’ REALITY
PR is multi-dimensional & dynamic
Fleet of foot and quick to change TALK PR (COUNSUMER) £3M 2007 MYTH 2:
‘PERIPHERAL TO BRAND & MARKETING ACTIVITY’ REALITY
PR has the CEO’s ear & seat at the table OUR CLIENTS MYTH 3:
‘JUST ABOUT SPIN & HYPE’ REALITY
Corporate & brand reputation = New driving force of consumer decisions
PR is at the heart of it 02 TRIALOGUE CONCEPT
TRIALOGUE P&G BEAUTY (& GROOMING) MYTH 4:
‘ALL ABOUT THE PARTY!’ REALITY
PR is at the heart of the drive to content creation
Our content ideas have changed the product offer, not just the communication
American Express European Luxury Project
Retaining American Express’s Premium Positioning
July 9, 2006
MYTH 5:
‘LUVVIES WHO LOVE TO NETWORK’
REALITY
We create relationships with clients that drive their business
With influencers and through strategic alliances MYTH 6:
‘LOCALLY FOCUSED’ REALITY
The UK is one of a small number of markets trusted to create global plans and templates
30% of Talk PR’s fees are for global projects
VALENTINO V ROME
FRANCE GERMANY BULGARIA CZECH REPUBLIC
LA CROIX 20th March 2006 Circ: 38,100 March 2006 TISCALI.CZ Circ: 280,000 27th February 2006 Circ: 45,000
GOLFPLUS.DE 25th January 2006 Circ: 1,800 TALK PR IS RIPE & READY FOR GROWTH
• Beyond consumer PR
• Great clients = great potential
• Corporate reputation drives consumer choice
• Content is king
• Strategic alliances drive business growth
• The world is our oyster!
THESE ARE EXCITING TIMES FOR TALK PR!! Walker Media
We plan all our buying and buy all our planning “Keeping our heads…”
Focus on consumer and sales
Respect for the power of advertising Media is simple
Target Proposition audience
Strategy
Media Competitive environment context Only agency in the top 10 via organic growth
M&S Weetabix Summer ‘00 Summer ‘05 Launched Nov ‘97
DSG KFC Barclays Jun ‘98 Summer ‘03 Spring ‘06
Fastest to £100m Fastest to £200m Fastest to £300m Amongst the “mega-groups”…
Ranking (within top 20) Network Agency Billings Clients / Brands £ / client £/ brand WPP MediaCom £871m 89 / 375 6 12 Omnicom OMD £836m 75 / 246 3 4 WPP Mindshare £725m 31 / 100 1 1 Publicis Starcom Group £657m 60 / 167 4 3 Aegis Carat £634m 65 / 212 7 7 Publicis ZenithOptimedia £566m 52 / 185 5 5 WPP Mediaedge:CIA £303m 48 / 124 12 11 IPG Initiative £299m 40 / 121 10 10 M&C Saatchi Walker Media £280m 19 / 60 2 2 Omnicom PHD £245m 29 / 87 8 8
Source: MMS (MAT to Sep ’07) …a distinctive ‘composition’… Amongst the “independents”…
Ranking (within top 20) Agency Billings Clients / Brands £ / client £/ brand Walker Media £280m 19 / 60 2 2 MediaVest Manchester £132m 39 / 169 18 18 Brilliant Media £108m 23 / 144 13 19 BLM £68m 19 / 85 17 17
Source: MMS (MAT to Sep ’07)
…in a class of our own The offline display market has grown by 6% since September 2003
8.6
8.4 MAT @ Sep ‘03 MAT @ Sep ‘07 UK total
8.2 £7.77bn £8.24bn
8.0
7.8
7.6 Billions MAT billings MAT 7.4
7.2
7.0 Jul-04 Jul-05 Jul-06 Jul-07 Jan-04 Jan-05 Jan-06 Jan-07 Nov-03 Nov-04 Nov-05 Nov-06 Mar-04 Mar-05 Mar-06 Mar-07 Sep-03 Sep-04 Sep-05 Sep-06 Sep-07 May-04 May-05 May-06 May-07
Source: MMS £9bn The media mix has remained broadly steady
£8bn TV Press Outdoor Radio Cinema Cinema 2.0% £7bn Cinema 2.1% Radio 5.7% Radio 6.0% £6bn Outdoor 9.7% Outdoor 8.5%
£5bn Press 35.4% Press 35.2% £4bn
MAT billings MAT £3bn
TV 47.4% £2bn TV 48.1%
£1bn
£0bn Jul-04 Jul-05 Jul-06 Jul-07 Jan-04 Jan-05 Jan-06 Jan-07 Nov-03 Nov-04 Nov-05 Nov-06 Mar-04 Mar-05 Mar-06 Mar-07 Sep-03 Sep-04 Sep-05 Sep-06 Sep-07 May-04 May-05 May-06 Source: MMS May-07 Online expenditure has grown dramatically
Online Spend
3,000
2,500
2,000
Millions 1,500
1,000
500
0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
Source: PWC Search has increasingly dominated the mix
Search Display 70%
60%
50%
40%
% of £ 30%
20%
10%
0% 2002 2003 2004 2005 2006 2007
Source: PWC With smaller players under pressure, we see 12% fewer 1,200 active agencies than 4 years ago
Active media agencies
1,150
Sep ’03: 1,183 active agencies Sep ’07: 1,040 active agencies 1,100 Reduction: 143
1,050 No. of agencies with recorded UK billings (MAT) billings UK recorded with agencies of No.
Source: MMS 1,000 Jul-04 Jul-05 Jul-06 Jul-07 Jan-04 Jan-05 Jan-06 Jan-07 Nov-03 Nov-04 Nov-05 Nov-06 Mar-04 Mar-05 Mar-06 Mar-07 Sep-03 Sep-04 Sep-05 Sep-06 Sep-07 May-04 May-05 May-06 May-07
‘Top independents’
Four of the current top 20 media agencies lie outside the global networks.
In descending order of current billings, they are… The global networks’ combined share has remained £9bn relatively static £8bn Global networks Top independents All others
£7bn All others All others 19.2% £6bn 22.4%
Top independents 7.4% £5bn Top independents 5.0% Global networks Global networks 73.5% £4bn 72.5%
MAT billings MAT £3bn
£2bn
£1bn
Source: MMS £0bn Jul-04 Jul-05 Jul-06 Jul-07 Jan-04 Jan-05 Jan-06 Jan-07 Nov-03 Nov-04 Nov-05 Nov-06 Mar-04 Mar-05 Mar-06 Mar-07 Sep-03 Sep-04 Sep-05 Sep-06 Sep-07 May-04 May-05 May-06 May-07 Walker Media’s +69% growth outstrips the top- 180 performing network
160 Walker Media Aegis Havas IPG Omnicom Publicis WPP
140
120
100
80 Index (MAT billings vs Sep '03) Sep vs billings (MAT Index
60
Source: MMS 40 Jul-04 Jul-05 Jul-06 Jul-07 Jan-04 Jan-05 Jan-06 Jan-07 Nov-03 Nov-04 Nov-05 Nov-06 Mar-04 Mar-05 Mar-06 Mar-07 Sep-03 Sep-04 Sep-05 Sep-06 Sep-07 May-04 May-05 May-06 May-07 The Future as it relates to planning and buying
Mass Media …content
‘Digital’ …content
Consumers …content ….so Walker Media?
Focus on retention and protect USP …Talent
Build on digital offering across existing client base …Talent
Tailored international growth …Talent