Mike Moran brings fresh eyes to CBS Outdoor
By Harriet Dennys, mediaweek.co.uk, Monday, 14 June 2010 10:47AM
In his first interview since becoming UK managing director of CBS Outdoor, former Toyota chief Mike Moran tells Harriet Dennys how he plans to make an impact at the UK's number two outdoor advertising firm
When Mike Moran moved to Madrid to work for Ford Espana, the race was on to become fluent in Spanish. Rising to the challenge, he went from "dos cervezas por favor" to fluent within five weeks - a skill he took to Thames Water, where he advised president Lagos of Chile on the country's sanitation programme.
These days, Moran's Spanish is handy for berating his new boss Antonio Alonso, international chief executive of CBS Outdoor - "we can abuse each other in two languages, and we often do" - after he joined the company as UK managing director in January.
It is unclear what the Spanish is for: "There is a technical problem with the digital escalator panels at Oxford Circus" but Moran, who made his name as a marketer, is emphatic he has always been interested in media and plans to make an impact at the UK's number two outdoor advertising company.
"Although I look at the world through a marketing lens, I am more a general manager than a marketer," he says. "CBS Outdoor is a phenomenally successful global media business and the company has aspirations to grow the business internationally. Within that they have a very strong outdoor portfolio, with a strong commitment to outdoor advertising."
Globally, about 12% of CBSO's revenue comes from outdoor, but in the UK it represents more than 60% of the firm's turnover, giving it a 23% share of the outdoor market. Moran adds: "CBS is a player of scale in the UK, and it is appealing because it is a very focused play. We stand apart from our competitors because we don't have a wide mix of formats; it is all about transport."
Moran, 50, is best-known for his time in the motor industry, spending 17 years at Ford and then Toyota, where he was credited with taking the car-maker from "zero to hero" in the UK market. As if on cue, a journalist rings Moran asking for insight on the now-floundering firm's latest marketing strategy - which, for the record, he believes will engender public sympathy.
When corporate life became "wearing", Moran stepped away to start his own consultancy, The Orchard Consultancy, where he acted as the "orchestra master" by building relationships with other businesses. But the lure of big corporations proved too strong; when CBSO's top UK position became vacant, he made a successful approach to Alonso, starting at the company on 17 January.
Bringing new ideas to the business
Although Moran joins from outside the sector, he is well-known to the outdoor village thanks to a memorable Toyota campaign from 1997, when the car-maker took over 990 poster sites, rebranded the borders in Toyota red and ran back-to-back campaigns promoting the brand's latest models.
Drawing parallels to his friend Adam Crozier, who joined ITV from the Royal Mail, Moran maintains his outsider status will "bring new ideas to the business". "Not a single person has said ‘what do you know about posters?' because they know I have always been interested in outdoor," he says. "Fresh eyes count for a lot."
Fresh eyes is arguably what CBSO needs, after a $96.9m global operating loss for 2009 and a revolving door of senior departures, including former international chief executive Clive Punter and former managing director of sales and marketing Tim Bleakley, newly installed as chief executive of Ocean Outdoor.
Questions have also been asked about the impact of the recession on the business relationship surrounding the London Underground contract, which CBSO is tied into until 2015. One outdoor media buyer told Media Week: "The parent company would dump it like a shot if they could get out of it."
But Moran is stabilising the 500-strong company's senior team - Richard Dickinson has just been promoted internally to operations director and he is searching for a new marketing and business development director - and he insists the London Underground contract is still a "fantastic asset" and one of the main attractions for joining the firm.
On the eight-and-half-year LU deal, he says: "The details of the contract are confidential but, like many people, the arrangements we had and the expectations we had were affected by the recession. Moving forward, one of our main challenges is to sell the Underground inventory as effectively as we can - absolutely we are committed."
He adds: "Under the contract we have now, we have transformed the advertising estate and London Underground is thrilled with what we have achieved. And we don't perhaps get the credit from the advertising community that we deserve."
Leading the digital market
The behemoth London Underground contract - the biggest outdoor advertising contract in the world and one that represents about 75% of London outdoor sheetage - is a cornerstone of CBSO's portfolio.
The company also holds the franchises for 37,000 buses, 123 digital sites in Westfield shopping centre, and about two-thirds of all managed rail stations nationwide. Three-quarters of CBSO's sites are in London, and it represents about 75% of the capital's outdoor advertising estate.
CBSO is also the market leader in digital: its 2,000 digital screens, split between the Underground and Westfield, make up about half the UK's digital sites. Moran says he likes nothing better than to stand on an Underground platform and watch how people interact with cross-track screens, and wants to "re-engage with the creative community to remind them how powerful the digital assets are".
"What sets us apart is that we can do so much more in terms of innovation. A lot of digital outdoor has to be static, whereas we have the full suite of interactive, moving image, wi-fi connectivity. We have digital capabilities we haven't even switched on yet; we have only scratched the surface of things like blucasting. In some respects we are ahead of media agencies, specialists and clients; we have to work with them to explore which new, exciting things they want to do."
However, some media buyers are still grappling with the premium CBSO charges for its digital panels: can the company justify its high prices in terms of ROI for advertisers? Moran's response is blunt. "Outdoor buyers should get with the programme: stop thinking about price-per-site and start thinking about audience delivery. Two million people go through the centre of London on the Underground per day. If you are trying to reach 25-35 year-olds and they live in zone six, they might never see your campaign unless you buy some 48-sheets on the Underground. Some advertisers really get that; others really don't."
Advertisers Moran singles out for praise include BMW, which chose the Underground to launch its new five-series model, and the New Zealand Tourist Board, which "absolutely made the most of the medium" with its all-digital campaign across DEPs and cross-tracks.
"The reason the Underground is more expensive is because it is significantly more engaging," he says. "Our latest research showed 83% of people welcome advertising on the Underground - without advertising, it feels odd."
CBSO is currently in the mix for the £100m Network Rail contract, and Moran's experience of the pitch process has shown him outdoor firms are learning from past contractual mistakes. He says: "The whole outdoor industry must start thinking about different models of how we work with franchise concessions.
"The historic model was always about making very large [revenue] commitments on guarantees, but the last couple of years have shown us there might be different, more intelligent ways of structuring long-term deals."
Moran is encouraged by CBSO's performance - Q2 should be up on Q1 - but remains sceptical about the long-term outlook for the sector, which he predicts will not return to 2008 levels before 2011/12, despite the World Cup and the Olympics. "People get over-excited," he says.
"The Games will certainly be a boost, but over what period of time? It is worth taking a very cautious view; let's not over-egg it."
Lives: In Stanton Harcourt near Oxford with his wife Janet and their five children, aged from four to 21
Cars: Various, including "some exotica"
Football team: "The mighty" Spurs
Desert Island Media: The Week, Dexter, The Times
Managing director, CBS Outdoor
Managing partner, The Orchard Consultancy
Worldwide director of marketing and strategy, RWE Thames Water
Commercial director, Toyota
Marketing director, Toyota
Managing director, Ford Espana
Sales director, Ford Espana
Various roles, Ford Motor Company, rising to manager of fleet sales and marketing
This article was first published on mediaweek.co.uk
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