Advertisement

Updated: Scanzoni Explains GroupM Print Consolidation

Advertisement

Against a backdrop of declining print ad spending, leading media agency conglomerate GroupM said it would consolidate its print units as it seeks more clout with publishing houses.
 
GroupM chief investment officer Rino Scanzoni said the move would impact U.S. consumer magazine and newspaper planning buying at Mindshare, Mediaedge:cia, MediaCom and Maxus, which is a part of Mindshare. The units represent an estimated $800 million in print billings this year, per inside sources. Their roster of blue-chip clients includes Kimberly Clark, Church & Dwight, ConAgra and LVMH.
 
Heading the two new teams at GroupM Print will be George Janson and Scott Kruse, who had led print buying at Mediaedge:cia and Mediacom, respectively. They’ll report to Jeanne Tassaro, the chief operating officer of GroupM Implementation. Kelly Foster, managing director of print for Mindshare, will remain at the company and will report to Janson or Kruse.
 
Mediacom, which had focused on negotiation, will now add planning and buying, as the Mediaedge:cia and Mindshare units do.

Today's announcement comes at a time when advertisers have sharply cut back their print ad budgets. In a recent forecast, PricewaterhouseCoopers called for print advertising in North American consumer magazines to fall 18.7 percent to $10.8 billion and for newspaper print advertising to decline 23.1 percent to $28 billion this year.
 
Scanzoni said that the purpose of the reorg wasn't to reduce costs, although he acknowledged that a small number of administrative positions would be cut as a result. By consolidating the print units, GroupM hopes to increase its negotiating prowess with publishers, he said.
 
"It's not just for price," said Scanzoni. "We have some issues in terms of accountability, research data. If you have a single voice, you can affect that change quicker and more effectively. In terms of how readership is measured right now, I think it's still pretty archaic. I think improvements could be made in how we measure circulation and readership, how effective ads can be in different environments, and how we evaluate that. We can sit down with the publishing groups and have a bigger voice."
 
The move harkens back to 2008, when GroupM consolidated its units for another hammered sector, local broadcast. And it may foreshadow a similar approach to radio.
 
At the time, Scanzoni said the goal of the broadcast reorg was to better position GroupM to buy local media as the shops rapidly leverage the Web and mobile platforms. A few positions were eliminated as a result.
 
"I think that network radio, that's something we might look at sometime down the road," he said in an interview today. "You try to do these things in some sort of a sequence. We're trying to do this very, very methodically."