Media Buying Briefing: Omnicom Media Group’s Florian Adamski on why he’s not worried about a potential recession

Virtually a 12 months into his tenure as international CEO of Omnicom Media Group (OMG), Florian Adamski (recognized by colleagues and pals as Flo) nonetheless has to drive himself to remain above the fray of particulars and growing complexity of the fashionable media company enterprise. He confesses to all the time being a meticulous element man, however having 22,000 workers worldwide, and 380 totally different specialties all finally reporting to him, necessitates stepping again from the granular day-to-day of his remit.

Most just lately the CEO of OMD Worldwide (a part of OMG) and earlier than that head of OMG Germany, Adamski worries much less right this moment concerning the financial surroundings, saying he expects the remainder of 2022 to melt however with a fast, V-shaped restoration in 2023. 

Adamski spoke with Digiday within the company holding firm’s headquarters in downtown Manhattan about how purchasers are making ready for the downturn and the way he retains his workers and his boss — Omnicom CEO John Wren — comfortable. 

The next interview has been edited for readability and house. 

The anticipated and sudden a 12 months into the brand new position

I’ve been with Omnicom for 26 years at this level. What clearly has been totally different is solely the truth that the world has been altering dramatically for all of us. And this isn’t something specific about Omnicom Media Group and even the media enterprise. We’re coping with very totally different environments because it pertains to the buyer … and the way that drives one more shift in media spend and funding and advertising and marketing expertise spend. 

From a consumer perspective, consumer behaviors are very totally different. If you consider how purchasers go to pitch, how typically they pitch, what sort of questions they might ask, how they have a look at company companions right this moment, [it’s] way more about progress and advertising and marketing transformation companions as a coach versus simply being media spend orchestrator.

Workforce flexibility. 

I feel we should be very, very particular and make a distinction about what kind of roles will we see benefiting — and never a lot — from a distant studying surroundings. All people says that creativity thrives on interpersonal relationships and I agree with that notion. I can see how bringing individuals again to the workplace and having workshops, brainstorming periods are essential for us. Clearly consumer conferences [as well], proper?

Having mentioned that … why would I ask individuals to commute [up to] two hours-plus every day after they can most likely be simply as environment friendly and generally much more productive from a distant place? So I feel we’ll have to remain versatile and agile, and never make too many predictions concerning the future as a result of it has confirmed all to be flawed. That can have implications to sure elements of our enterprise, [starting] with actual property choices.

On the financial near-term and the way purchasers are managing it.

I feel the most effective continues to be forward of us as a result of, sure, we could be hitting a technical recession — you may also argue we’re in a recession already. We’ve seen two quarters of detrimental GDP. I’m not an economist, however I really imagine that, sure, we are going to see softness in This autumn going into 2023 that may or won’t have an effect on promoting markets.

However I don’t imagine that we are going to see … a long-term downturn. I imagine that we’ve got a really, very wholesome economic system on the core. We see shopper demand being very, very secure. Individuals are beginning to commerce down, however after all [people will be] buying and selling down if grocery costs and gasoline costs soar 10, 20, 30 %. I see this coming again up as a result of the enterprise fundamentals are simply very, very proper. 

[The pandemic] has taught us some classes and I feel it has helped purchasers perceive who’re the companions that actually assist [them] to rework [their] enterprise. It’s compelled them to speculate into that transformation.

Q1 and Q2 of 2022 had been exceptionally robust [for] corporations. Our purchasers, many different purchasers invested closely into pent up demand. Throughout many of the verticals that we’ve got visibility of, we noticed advert spending improve double-digits within the first half of the 12 months. What’s taking place now’s what I’d name a brief dip. It’s not a structural disaster … As a result of lots of the challenges that we noticed creeping in through the first half of the 12 months are literally abating to a level.

The availability chain appears to be extra sturdy. We don’t know what they’ll do with the following COVID wave however at the least proper now, most of China is is open for enterprise.

I feel we’ll see some accelerated progress on the very newest in Q3 subsequent 12 months. Q1 could be just a little softer. I feel we’ll see issues stabilizing in Q2. And I’ve only a few purchasers off the highest 20 to 30 that I speak to regularly that at this cut-off date would have a look at 23 and go, ‘That is going to be a tricky 12 months for us.’

Most purchasers typically really feel bullish concerning the enterprise that they’re in. Many have invested sturdy quantities of cash into digital transformation. They’ve digitized their processes, digitized their provide chains. They’ve typically scaled up their workforce. So most of them appear to be ready for this short-term dip, after which for a really, very accelerated fast restart.

The place OMG derives its income

The share of our income that comes from conventional media planning and shopping for has … considerably decreased. What has come up, then again, is consultancy providers, advertising and marketing transformation providers, mar-tech, ad-tech consultancy. 

Shoppers are confronted with at the least three main challenges. 

  1. Shopper knowledge privateness. Clearly there is just one means this can go: extra, not much less regulation. And by the way in which, I’m very a lot a free market agent. Having mentioned that, I feel sure regulation can really be useful if … we wish to create a greater shopper expertise. 
  2. Retail media and commerce. [It’s] one thing that purchasers have realized they need assistance with, in addition to they have a look at the holistic shopper expertise. How do you create this full visibility of each greenback that’s on the market out there?
  3. The loss of life of the cookie. We see lots of stats about the truth that lots of consumer organizations don’t nonetheless don’t really feel sufficiently ready for no matter goes to come back subsequent in that house. One of many default solutions appear to be clear rooms, which I don’t disagree with. I feel it’s very, essential. The issue that I’ve generally is, if clear rooms are disconnected from one another, does it imply we’re constructing walled gardens on high of walled gardens? I most likely shouldn’t say that as a result of we ourselves have struck quite a lot of very, very high-profile partnerships with a few of these clear room suppliers. But it surely’s solely it’s solely a part of the answer.

Complexity is the guide’s pal, however complexity is [also] the company’s pal. We simply did a current depend throughout Omnicom Media Group and we’ve got a minimum of 380 totally different specialties. It’s fairly overwhelming generally. If you consider issues like verification, model security, privateness — these are all new themes that didn’t exist only a few years in the past. Nonetheless, now we’ve got whole items that don’t do something however seek the advice of and assist our purchasers to grasp knowledge, privateness legal guidelines and regulation in several areas around the globe.

Coloration by numbers

Many forecasts challenge report political spending for midterm elections which can be outpacing 2020. Broadbeam Media took a have a look at how a lot tv spending has grown in recent times, particularly as PAC spending continues rising in native markets.

  • Information nonetheless dominates political TV spending, making up practically 60% of all political spot TV spending in 2020. Sports activities, whereas a smaller contributor, accounts for about 10% of this spending.
  • Because of redistricting, Broadbeam predicts the political share of spot TV in a market will rise by 5% this season.
  • PAC spending in native markets has grown greater than 30% a 12 months, outpacing that of political marketing campaign spending. In non-presidential election years, the agency estimates PAC spending makes up 25% of political native TV advert spending. In markets with fewer aggressive races, PAC spending could make up the entire native TV {dollars}. — Antoinette Siu

Takeoff & touchdown

  • Horizon Media landed media company of report duties for Lionsgate, maker of such films because the John Wick sequence. The incumbent was Publicis Media’s Starcom.
  • Main League Baseball staff the Minnesota Twins launched a Stagwell-backed augmented actuality app, referred to as ARound, for Goal Subject in Minneapolis, letting followers play video video games and work together with the reside sport on their telephones.
  • Austin-based direct-response company Efficient Spend is merging with efficiency advertising and marketing tech agency Optimad to type a brand new firm referred to as Optimum, providing providers together with search engine marketing, paid search and social, programmatic, related TV, efficiency, and inventive. 

Direct quote

“On this fragmentation of the CTV world, there’s lots of alternative for the mid market gamers to have a a lot bigger share of voice proper now than they are going to within the subsequent 12 months and a half to 2 years, I learn a Nielsen report just lately that CTV spend compared to all different digital channels is lower than 5%, however the viewers for these (relying in your age demo) is anyplace between like 40% to 80% of the digital house. There’s an enormous hole between what media spend is and what the voice is. So midsize manufacturers and companies have a possibility to land on among the larger [streaming services] of the world, as a result of that stock is so extensive open proper now.”

— Rob Figueroa, vp of gross sales at mid-market ad-tech platform AudienceX, speaking concerning the upside of the present glut of CTV and streaming stock. 

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