Mars has done it. So has Nike. And Procter & Gamble. And the
surprising thing is that they all did it almost four years ago, within
months of each other. We’re talking global media deals - and, in
particular, deals with Rupert Murdoch’s News Corporation. The
conventional wisdom is that these things are like buses. You wait for
years and then three come at once. Well, now we have to stand that
conventional wisdom on its head. A regular service is on its way.
Last week, News Corp created a global advertising division, News Corp
One, which will offer advertisers a one-stop shop for deals across the
company’s properties. There are more than 35 ad-supported operating
companies in the Murdoch empire, stretching from the Far East (Star TV),
Australia, through the UK (Sky and News International) to the Americas
(the Fox TV and film operations).
The New York-based unit will be run by Kayne Lanahan, previously the
media director of the Omnicom-owned agency, Merkley Newman Harty, and
formerly manager of entertainment and sports broadcasting negotiations
at Coca-Cola. A team of three will report to her.
It looks impressive, but will it work? Are we really going to see a lot
more of the global deal? The problem in the past has been
In theory, advertisers were increasingly centralising bits of the
marketing function, either on a regional or a global basis. That
supposedly meant that they not only had a detailed overview but an
ability to derive central strategies and the budgets to back them.
The reality, though, has not quite matched up to expectation. Until
Clients are getting there. And where advertisers go, agencies -
especially the big networks - will follow. The spotlight has now fallen
on media owners.
The big problem everyone faces is the not-invented-here syndrome. Local
bosses in any multinational have unremitting profit and loss
And when their jobs are on the line, getting them to think outside that
box is next to impossible. Why should someone in charge of a UK
newspaper finance the weaknesses of an Asian television channel? Or why
should some of a German marketing budget be used to finance a Hollywood
To work, global deals must be driven (on both sides of the fence) by
companies with good answers to those questions. Or, failing that, the
willingness to knock heads together. News Corp says it is ready. So do
advertisers. Are they kidding themselves? Will global deals happen on a
regular enough basis to justify formal structures like News Corp One?
And where do agencies fit into this?
That rather depends, Paul Woolmington, president of media operations at
Young & Rubicam in New York, argues. ’You have to applaud this
This is the way large media groups have to go. But I think it will only
really be of interest to the largest advertisers and agencies and the
reason it is timely is because innovative clients and agencies have also
stepped up to the mark. We have executives empowered to make these deals
happen - and agencies should have nothing to fear, provided they
approach it right. Media owners will only go direct to clients if they
don’t get the right response from agencies,’ he says.
Woolmington believes News Corp will take a sophisticated approach -
discussions aren’t going to be just about discount, share of spend and
They will be about partnerships that can deliver broad communications
goals. He has only one caveat: this group must have real teeth if it is
to deliver across the group’s properties.
Paul Longhurst, the executive media director of Ammirati Puris Lintas,
agrees. ’The client may use all or most of these media vehicles
The ability to leverage that centrally is a step forward. Yes, of course
discount comes into that, but it isn’t the whole or even the main
This will not be about discussing the price of a page in the Sunday
The attraction is the chance to share strategic issues with people who
can see the big picture. But this sort of thing will only apply to the
big advertisers and the big advertising networks. That’s why we see it
as a competitive advantage.’
Ron de Pear, the executive vice-president, media, of JWT Worldwide,
says: ’Five years ago, we were talking about mergers between the big
media owners and about the global and regional opportunities that might
emerge. There have been few opportunities up to now. Whether people are
ready depends on there being a person whose job is to take
responsibility for this happening.
That’s the same whether you’re an advertiser, agency or media
What about the benefits? Sometimes they seem a little vague. ’If it was
just about cost there would be little incentive from the media owner’s
point of view,’ de Pear argues. ’It has to be about putting together
genuine communications packages. It’s about taking an idea and
expressing it to the maximum number of consumers. The prime example is
what Kellogg’s did with the Mask. It ranged across a number of things
such as sponsoring the programme and appearing in the cartoon to on-pack
Most commentators say the new venture’s likely success can’t be judged
until they see the detail. So far, according to Charlie Varley, the
marketing director of Optimum Media Direction, there are many more
questions than answers. ’The media industry has been talking about
global deals for the past three or four years and agencies have always
insisted that they’re ready. Now we’ll see. I think a lot of the
smoke-and-mirrors operations will be found out. I’d say that most - if
not all - the big networks are well placed.
’But what happens if News Corp decides to pitch it directly to
It could make for some interesting conversations. Murdoch might identify
12 clients he can work with at a global level. How are they chosen? From
the top down or from local offices up? And what happens if he offers a
car company a five-year exclusive deal? It might work well for New York
but not look so good for London and Hong Kong. We’re ready - but it will
be very interesting to see what conflicts of interest this throws up.’