Nick Theakstone, arguably the most powerful executive in global media buying, is reportedly stepping down as global chief investment officer of WPP’s GroupM, which disposes of some $108bn of client money worldwide.
Theakstone (below) ran GroupM in the UK for years before taking up a global role, one of a group of hard-nosed British media buyers who provided the financial engine for WPP’s soaring profits in the Sorrell era.
It all began to change when the US Association of National Advertisers produced a report on undisclosed media rebates in 2016 and, while the report didn’t mention media buyers by name, it didn’t need to. The cat was freed from the bag by a whistleblowing former executive at GroupM’s MediaCom.
Clients began to look at their contracts and some agencies began paying them back large sums of money.
On top of this came the rise programmatic, essentially human media buying decisions being made by computers in an automated auction. And, all the time in the background, was the steady flow of digital money to Facebook and Google. A process that didn’t require the services of a media agency, however hard they tried to intervene in the process.
So it’s the end of an era, one which began in the UK in the 1970s as media directors including Paul Green, John Ayling, David Reich and Chris Ingram tired of being treated as an afterthought by their agencies and set up on their own.
In the end the agency holding companies bought most of them but commission had been split between creative and media agencies, to be superseded by fees – not nearly as profitable.
All sorts of high earners are currently leaving the agency business in Covid-19 and maybe the likes of the highly capable Theakstone will be replaced. But agency groups, like Mark Read’s WPP, are going to be looking again at the possibility of re-incorporating them into some kind of full service agency model.
After all, if he can shoehorn VML and Y&R and JWT and Wunderman together why not, say, Ogilvy and MediaCom?