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To prove it’s ready for IPO,
Facebook seeks ‘tentpole’ deals
first meeting of Facebook’s “client
council,” which consists of representatives from six big brands,
including Coca-Cola and Walmart,
along with a half-dozen major
agency-holding groups.
But the task isn’t quite that simple: As more marketers consider
committing big dollars to the social-networking giant, Facebook must
address concerns ranging from a
lack of ROI metrics to its constant
change, which can catch users and
clients off-guard.
The challenge for Facebook is
“trying to innovate from a product
perspective and at the same time
establish some consistency from a
commercial standpoint,” said Nigel
Morris, CEO of Aegis Media
Americas, which is part of the client
council.
The best example of a tentpole
deal to date is with Diageo (a client
council member), whose commitment is worth more than $10 million and promises “to provide metrics to help Diageo define ROI and
performance across its priority
brands.” Facebook is also offering a
sneak peek at new features and ad
products it’s testing to some advertisers that have committed to yearlong deals.
With special attention and programs, Facebook is looking to
become the first place brands go to
spend their online ad dollars, though
it’s also notable that older media
companies such as Google, Yahoo
and Microsoft have all convened
similar advertising-client councils.
According to Carolyn Everson,
VP-global ad sales, the company is
building out its global agency team
and has designated liaisons dedicat-
ed to overseeing the relationship
with Omnicom, WPP and Aegis.
It’s also hiring for Publicis,
Interpublic and Havas and growing
its global account team to match
with global companies that have an
appetite for emerging markets.
“Agencies are
responsible for
over half of ad
spend globally,”
she said. “At
core we believe
we must invest
time and
resources with
agencies at all
stages, through creative to execu-
tion of a media campaign.”
To that end Facebook has
unveiled a premium ad unit geared
toward big brands already spending
millions every year on Facebook
ads and a revamped measure-
ment—or “Insights”—tool
designed to provide better meas-
urement. It also spent the week pre-
senting an array of case studies for
campaigns on fan pages from
brands such as Levi’s, Burberry and
American Express.
“The key for Facebook is going to
be demonstrating that it has solid
revenue streams that are capable
of supporting this huge valuation
that the company has.”
While she thinks user experience is still paramount at Facebook,
eMarketer principal analyst Debra
Aho Williamson said Facebook has
delivered on what marketers have
been asking for in one especially
key area: more social ads. An
expensive premium ad offering
announced last week, for example,
is essentially a souped-up version of
sponsored stories, adding the social
context of a user’s friends’ likes and
comments to a piece of a branded
content that’s then served in the
premium slot.
“The key for Facebook is going
to be demonstrating that it has solid
revenue streams that are capable of
supporting this huge valuation that
the company has,” she said.
Facebook’s valuation has
recently been charted as high as
$100 billion.
Mounting new pressures cited in
growing number of CEO changes
MEDIA AGENCY CEOS from p. 4
to your children,” said Michael
Kassan, CEO and founder of Media
Link and a onetime media agency
chief himself. “That’s not the case
anymore.”
Mr. Doyle, who up until recent-
ly sat atop MEC North America, is
the latest chief to exit his role.
During the announcement of his
leaving, Mr. Doyle told Ad Age
that when he stepped into the CEO
role in the first quarter of 2007, the
agency had clear global objectives.
“My role was much more about
executing that vision,” he said.
“Now I think it’s time to set a new
vision.”
It’s this new vision that keeps
many of today’s media-agency
leaders awake at night, dreaming
up ways to innovate and grow
business possibilities in a much
more integrated- and digital-media
world—and finding ways to make
their offerings about more than
just scale and price.
“It’s no longer a world about
buying upfronts,” said June
Blockin, partner at Juel Consulting.
LEEDOYLE:
Former CEO of MEC North America is the
latest media agency CEO to exit.
“We’re seeing an ongoing shift
toward this new digital space and
the CEOs are under pressure from
a top-line standpoint and from a
margins standpoint.”
As a result, agencies are looking
for “hybrid talent” CEOs with
experience outside the traditional
media agency. They want someone
who can bring in new data and dig-
ital capabilities and ideas, and in
doing so create new opportunities
for employees in an effort to help
curb the senior-level churn. “It’s a
problem that appears to be particu-
larly pronounced in media agen-
cies,” she said. “What is driving it is
a prevailing feeling that there is lit-
tle room for advancement, and that
no one is looking out for them.”
In Ms. Blockin’s estimation, in
the new environment, media agen-
cies are working harder to evolve,
protect and grow their strategic
planning and digital business mod-
els. They’re facing new competition
from other types of agencies and
media companies which are deal-
ing with the marketers directly and
hiring strategic thought leaders
from media agencies. Clients,
working with procurement to cut
costs, are doing a lot of the digital
work themselves, she noted.
