Global Media Agency of the Year: How OMD Became the One to Beat in 2014
…And landed Johnson & Johnson’s $1 billion account
By Noreen O’Leary
Mainardo de Nardis, Global CEO, OMD
Mainardo de Nardis remembers the day in 2009 when he first showed up in his new boss’s office. Omnicom Media Group CEO Daryl Simm told incoming OMD global CEO de Nardis that one of his key priorities should be landing Johnson & Johnson’s media business in the U.S. (No pressure there, right?) It wasn’t just about solidifying an existing global OMD relationship with a massive marketer like J&J, but de Nardis needed to bring in the biggest-spending region for a worldwide client.
Five years later, the Omnicom network landed the J&J business, and with that feat de Nardis and his team delivered—without even a pitch—an account with U.S. spending of nearly $1 billion, accounting for about 30 percent of OMD’s global new business in 2014. It was a high point in a year in which global net revenue grew an estimated 13 percent to $2.3 billion and improved 17 percent in the U.S. to $965 million. That’s an enviable gain for any agency network, let alone one grappling with growth amid conflicts. For that, OMD is Adweek’s Global Media Agency of the Year—the fourth time since 2009 the group has received that designation.
“We are proud but not surprised by this accomplishment,” says Alison Lewis, J&J’s global chief marketing officer. “OMD is a terrific partner who seeks out innovation and pushes their work to the next level.”
The J&J win underscores the increasing strength of OMD’s global relationships, which helped it win a plum U.S. assignment with the kind of new-business push that typically begins on a U.S. multinational’s home turf. “Expansion normally goes the other way,” explains de Nardis. “It’s a testament to the credibility, reputation and relationships we’ve developed with marketers’ business in other parts of the world.”
It also illustrates that OMD, created in 1996, has become a global force to reckon with. It is now a media network serving 24 global marketers, far more than any of its peers. Rather than merely chasing global accounts that go into review, the agency has expanded existing marketer relationships and sought out new ones quietly and deliberately.
“The win of accounts like J&J serves to reinforce the global reputation that OMD has in its ability to take on client relationships and show the depth and breadth of capabilities so that it can keep moving that relationship along and deliver consistency in more parts of the world for any client,” says OMG’s Simm. “It’s a polishing and verification of those global agency credentials and application of the new chosen capabilities we have.”
That is why revenue growth is only part of OMD’s story from the past year. An initiative that assures global marketers regional consistency is the agency’s Vision platform, which rolled out globally last year with the mission of connecting worldwide and local resources through an online tool kit.
“In 2014, we really focused on consistency, and Vision was a great step forward,” as de Nardis tells it. “Now we have the same operating system across the globe. Our people work in the same way, share information, data, insight, ideas. Of course, it’s fundamental to global clients because someone at OMD New York can see what’s happening with [OMD client] Pepsi in Australia. But also for our clients, it’s critical to be able to walk into a market and know that we work in exactly the same way everywhere.”
OMD also developed Oasis, a series of think-tank sessions at industry events. After launching at the Consumer Electronics Show in January 2014 as an alternative to boozy agency parties, it was expanded in the summer to the cabanas of Cannes, where festival attendees rubbed shoulders with representatives of companies like Google, Twitter, Pinterest and LinkedIn.
Bringing together clients and innovators has become a signature way of doing business at OMD. Last year, the media network hosted its second annual Final Front, a daylong event in Los Angeles that introduced OMD clients like Pepsi, Hasbro, PetSmart, State Farm, Levi’s, Hilton, Walgreens and Showtime to content creators such as AwesomenessTV, Machinima and Maker Studios. Both Oasis and Final Front are being expanded to include other countries.
Major brands managed by OMD and other members of the Omnicom Group
But the agency is not focused solely on concepts that are born in the U.S. De Nardis stresses that good ideas at OMD can start anywhere. For example, in China the agency is expanding its Innovation Fund, an employee initiative through which OMD finances entrepreneurial ideas in media, marketing and advertising. With China’s hypercompetitive talent market a challenge for any employer, the fund began last year as a way to attract and retain the best people, as well as to bring new technology and ways of thinking to the agency. OMD believes millennials in other countries will respond as enthusiastically to the program as those in China have.
A latecomer in the Asia-Pacific region compared to other large agency networks like WPP’s GroupM, OMD has been working to establish itself as a force there. In the APAC region last year, OMD won an impressive $480 million in new business, adding clients including Qantas, Heinz and Beiersdorf, which it won after eight separate pitches in markets including China, India and Australia.
(Account losses included Vodafone, Electrolux, REI, the U.K. National Lottery and the New York Lottery.)
Meanwhile, the agency is breaking new ground in Asia for clients including Wyeth. Infant-formula brands like Wyeth Gold in Hong Kong face severe restrictions regarding benefits claims, making branded content risky for the category. But while most brands remain focused on TV, OMD saw branded content as a resource for aspirational Chinese parents and worked with sister agency TBWA to create the app Learning-On-the-Go, which teaches children about global landmarks like the Eiffel Tower and Big Ben using Google Street View. In just two months, it became one of the five most downloaded education apps in the market, connecting with 327 parents a day on average. Brand appreciation soared, with 99 percent of parents agreeing Wyeth is a trusted resource for parents.
In Latin America last year, meanwhile, OMD rang up double-digit growth in Mexico, Colombia, Chile and Peru through the expansion of network clients like Apple and Nissan; organic growth from J&J, McDonald’s and Visa; and new-business wins that included Diageo in Mexico, South America and Central America.
Among the year’s creative highlights in the region was an effort for Banco Popular in the Dominican Republic. In the effort, OMD illustrated the affordability of car loans amid the country’s financial crisis through point-of-sale deals and receipt takeovers at retailers. The campaign, which was covered by newspapers, radio and TV shows and was chatted about on social media, generated more than $23 million in loans, a 50 percent year-over-year increase.
In the EMEA region, where OMD is the largest media network, the agency posted a 12 percent increase in revenue despite the considerable market challenges affecting the growth and financial stability in the eurozone. OMD earned more than $1 billion in new business there, including Disney, Liberty Global, Heinz, Hasbro, FedEx Europe, Gant and Specsavers.
The agency continued to elevate its reputation in the region over the last year, winning more than 40 Effies across EMEA and landing a place at the top of the European Effie Index for the fourth year in a row. The agency also won gold honors for its work on behalf of clients Specsavers, Dacia, EasyJet and McDonald’s at the IPA Effectiveness Awards. As a result, the Institute of Practitioners in Advertising selected OMD as Effectiveness Network of the Year.
As for the U.S., under the direction of Monica Karo in her first full year as CEO, the agency faced the dual challenge of onboarding big clients like Disney and Hasbro, won in 2013, while maintaining that kind of new business momentum a year later.
The agency kept its focus and came through, winning the likes of PetSmart, Cigna, Coach and Essilor/Transitions lenses in addition to J&J.
For Karo, a top priority was completing the digital reorganization that had begun a year earlier and tightening the integration of data and analytics. “The biggest difference in looking back over the year is how we looked at this, account by account, and the changes it made and how we helped our clients think about their data strategy—all of it without losing creativity and innovation,” she says.
That’s not lost on some of the agency’s most important clients. Early last year, McDonald’s became one of the biggest brands to experiment with the self-erasing photo app Snapchat, in a campaign featuring NBA star LeBron James.
“OMD is an innovative, creative partner with exceptional talent,” says Anja Carroll, VP of marketing at McDonald’s. “They keep us at the forefront of new opportunities such as Snapchat’s Brand Stories, which we used to launch our ‘Lovin” campaign.”
Parent OMG last year continued to forge relationships with other major digital players—among them, Instagram, which marked the social media brand’s first global agency relationship. OMD (along with sibling PHD) also boasts global relationships with Google, Facebook, Twitter and Maker Studios.
“OMD has shown a commitment to improving its planning tools, particularly in the area of planning, audience allocation and reporting,” says Stephen Haines, global agency director for Omnicom at Instagram’s parent Facebook. “Together, we are working on enhanced media mix model integrations. We partner with everyone across the organization, and the team is willing to give us feedback quickly and with clear focus.”
Just as important to de Nardis as technology is OMD’s creative pedigree, befitting an Omnicom network. In 2014, the agency was the Gunn Report’s most-awarded shop for the ninth consecutive report. And OMD took home two bronze Clios and one silver Clio, along with seven media Lions at Cannes.
“I like the emphasis on technology and data, but we want to balance it with insights and ideas because we don’t live in a world which is all about big data,” says de Nardis. “Big data is fundamental to achieve something, but it is through insight, strategy and ideas that you deliver it. … We want to win awards because it’s one of those KPI [key performance indicators] that we follow as strictly as revenue or profit growth. Winning more awards means doing better work. How do you measure innovation and creativity if not through awards?”
While OMD continues to build on those strengths year after year, clients such as Antonio Lucio, global chief brand officer at Visa, which consolidated its business at OMD seven years ago, say an equal measure of a good agency partner is when things aren’t going so well for the client.
“Anytime we’ve had specific issues in specific countries, we can go to Mainardo and Monica and they roll up their sleeves and come back with a 60-day solution,” explains Lucio. “That’s the sense of a partner and that’s the character trait that allows you to stay with an agency for a long time.”
Much of that internal collaboration goes back to OMD’s roots as a traditional media agency where the offices worked closely together to manage the national and local broadcast needs of advertisers.
“In the creative agency world, each office is an agency unto itself,” says Karo. “Because of the way their product and processes work, they don’t necessarily have to rely on another office to give them something that they need to do. For us, we had clients that were serviced out of different offices, so there’s a level of consistency that was built because OMD truly was one organization sitting in physically different spaces. As we’ve grown and brought in many more people, we’ve had to build that consistency, which is hard because it’s about the cultural aspects and not just about, ‘How do we work together?'”
De Nardis concurs, stressing that consistency in approach and performance helps bring in new business from global marketers like J&J and that will continue to drive growth in the future.
“Some companies thrive on difference and reinvention. We don’t,” he says. “Every company has their own DNA. We just stick to ours. We have a direction and know what’s important. We know ourselves, the good and the bad. We have confidence, but we don’t pretend to be the best. We always have to learn. But we know who we are.”
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