NEW YORK After six years on the client side, Peter Stringham has returned home. Home to the agency business, home to North America (where he has spent the bulk of his 31-year career) and home to 285 Madison Avenue in New York, where he previously worked as North American CEO of Young & Rubicam.
This time, the 57-year-old Canadian has taken the reins of Young & Rubicam Brands, which houses 18 agencies including Y&R, Wunderman, Burson-Marsteller and Landor Associates.
On Thursday, his third day as CEO of Y&R Brands, he sat down with Adweek senior reporter Andrew McMains to discuss the challenges ahead, the lessons he learned as global marketing chief at HSBC and what it’s like to work with WPP Group CEO Martin Sorrell.
Why is this position necessary and how are you going to make it meaningful?
For a good chunk of the client base, I suppose you could argue that it’s not really necessary, [especially for] smaller clients. For any client who’s complex or bigger, I think agencies have to figure out how to come to the party and help. Integration isn’t about one-stop shopping because I don’t think clients go around looking for that. What they really want is help bringing together all those disciplines and making sure that what they’re doing, particularly the brand-building part of the exercise, is really connected up.
How did Y&R Brands fall behind in this regard?
In simplistic terms people got distracted by other things. There were issues. Wunderman, going back six or seven years ago before I left, was struggling with how to re-gear to the new world of digital. That took time and it was costly and they are now looking strong. The advertising agency, of course, had issues in terms of turnover and so on and that cost them clients, so they were very focused on trying to get those advertising clients back.
How would you describe your management style and how will it differ from Ann Fudge’s?
I can’t comment on Ann Fudge because it’s just not fair. I met Ann a few times back when she was a client at Kraft. I’ve heard comments about how she ran the place, so I think you’d be better off to talk to somebody else. My style is first and foremost to be hands on, but I don’t like to reach over people’s shoulders. I think you have to absolutely know what’s going on in every part of the business as far down as you can possibly know but you can do that without actually running the business.
After six years on the client side, why switch back to the agency side?
A moment of weakness? I dropped my guard. (laughs) I had this debate with my wife who knows me better than anybody. She said to me, ‘You keep commenting on how the agencies are operating and what they’re doing for you. However, if you were doing it, you would do it differently. Maybe you want to go back to the agency business and find out.’ The more I thought of it that’s when I thought she was absolutely right because it was getting a bit frustrating seeing where the opportunities were and not being able to deal with them. . . . Because there’s no question the new space is really putting pressure on how agencies are going to deliver.
What lessons did you learn at HSBC that will help you in this job?
If I learned one thing, it is that you have to be absolutely ruthless about getting focused on your key issues. You can’t try and solve 22 issues at once. If you have a problem with differentiation of the brand you better make sure you’re solving that first and foremost and then worry about relevance and whether the brand has momentum, all those kinds of things will come as a result of it. One of the other things that we learned over the course of two or three years was that just about everything that you need to know about the brand, including service brands, which tend not to believe this, is measurable.
When you were at HSBC, how often would you interact with Martin and what was he like in that context?
He touched base monthly. He’s quite extraordinary. I don’t know how he does it. I have absolutely no idea. I don’t think he sleeps. I could have an issue, put a call in and say to his secretary, ‘Just have Martin give me a call when he has a moment, this is not urgent.’ He would phone me back within half an hour and it turned out he was in Hong Kong.
What do you think he’ll be like as a boss?
I don’t know, so far it’s great. We’ve become actually quite good friends over the last two years. I would say I was totally surprised when he phoned me and said, ‘If you’re leaving the bank, you want to have a conversation with us.’ I will say that I don’t know that I would have been as open to having that conversation until I spent the last three years working with him.
What advice did he give you in taking this job?
He’s astonishingly straightforward. He doesn’t play games; he just tells you flat out this is how it is. He was very honest about the fact that the place has struggled. Some parts, like Landor, seemed to continue quite nicely. Other parts, like Burson-Marsteller have been down and come back up.
What are the key issues facing the larger group and Y&R Advertising in particular?
The big task is to bring back together the potential of these companies, which I’m convinced, is there. . . I’m very impressed with [Y&R CEO] Hamish McLennan. I think he absolutely is the right solution for the advertising agency. Daniel Morel has done a great job of fixing Wunderman and restoring it to its luster. The old slogan of Y&R was “best alone, better together.” I think we’re very heavy on the “best alone” at the moment, and we’ve got to really get back to bringing the pieces together.
What are you doing to bring them closer together?
Training and education, thinking up ways that we need to connect people, is terribly important. The second thing is, I want to look at ways that we incentivize people so there’s actually some kind of reward.
What do you think of the merger of Draft and FCB and do you think we’ll see more of these types of hookups?
Well, it’s not the first time somebody has brought an agency and a direct marketing company together because Ogilvy and OgilvyOne were essentially put together some time ago and that’s worked successfully. What was unusual [about DraftFCB] simply was that they chose the head of the direct marketing company to lead it. He was obviously the better executive, I guess, in the eyes of whomever at IPG. One of the questions is, ‘How much do you have to actually put the disciplines together in order to achieve your goals?’ By having a company that is both the advertising agency and the direct marketing company, do you lose some of that ability to specialize as much as you should?
There’s been talk in the past of bringing Wunderman and Y&R together. Is that something you would consider?
I would consider it if people came to me with a really powerful argument. To be perfectly honest, I can’t see a really powerful argument for doing it. Wunderman has been terribly successful from the beginning. Lester Wunderman saw a need to create a specialized discipline, it has been terribly successful that way and bringing them together doesn’t really make any sense to me.
Why not?
Because I think what happens is you get back to the idea of one agency trying to be all things to all people. I mean if you’re going to fold Wunderman in, why not fold everything in? Why don’t we fold Landor in? It’s very difficult to be all things to all people. Certain parts of the organization, I think by definition, will suffer because they don’t have as much attention paid to them, they don’t get the same investment, and they don’t get the same sort of development in terms of training.
There are some advantages, though, aren’t there?
The only other reason I can see quite honestly for integrating them completely is first of all there’s cost savings because you get rid of some management. That may or may not be a good thing depending on the management. The second reason would be that supposedly you have people very, very focused on the client’s needs. Somebody is running it and somebody is driving the rest of the operation. I think far too often the way that model falls out is the somebody running the operation is the somebody from the advertising agency. Does that person really have a media-neutral way of looking at things?
What’s your biggest pet peeve about the industry?
I would say the biggest danger in the business is that it is incredibly easy for agencies to become myopic and appear terribly arrogant to their clients. It’s unbelievable to me how easily the agency can flip into a mode where it thinks it knows much better than the client. [The agency] decides to go in and tell the client what they should be doing when it doesn’t necessarily have all the information or it hasn’t really partnered with the client and worked through what the strategy should be and so on. I think the vast majority of people in the agency business would never do that intentionally. I think they just fall into it.
How would you define success?
We’ve got to get back on a growth track. The entire group has actually been on a growth track for the last year or two but not as significant as I’d like to see. I would like to demonstrate that big agencies can grow and resolve these issues that we’re talking about, especially in the new media space. [I’d like to demonstrate] that big agencies are, in fact, not an old model that’s broken; rather, they’re a very necessary model that needs revising.
And why are you the right person for this job?
Ask Martin. Even better, wait a year or two and ask the clients.
Q&A: Y&R Brands' CEO Stringham
