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5G Lewis Hamilton MediaCom

Wolfing it down

By The Drum | Administrator

April 10, 2008 | 6 min read

So what about this company that has potentially swallowed the media buying for the entire Scottish public sector? The Drum speaks to Mediacom’s Euan Jarvie and discovers that the firm’s early days represented a very close shave indeed.

The pace of change at Edinburgh’s Mediacom may be about to quicken, and soon. MD Euan Jarvie says that the company is planning on developing its own creative agency, as opposed to recommending partner agencies to their existing clients. If the agency performs poorly, it reflects badly on Mediacom, Jarvie says. Retaining the creative function as part of their own purpose-built offering is a preferable option to buying an existing agency, a move that Jarvie has ruled out. The start-from-scratch formula has worked so far, and as it is not broken, he has no plans to fix it. “Things are good. The business is growing again, probably in the region of 40 percent this year. We try not to focus too much on it or we end up picking over the bones and wonder how it all works. The reality is we have to keep moving forward,” he says.“We don’t pitch much as a business but when we do, we generally win. We have a very, very high hit rate. It’s about an 80 percent success rate. We only did six pitches in 2007, but won a collective £40m.” That’s a bullseye rate that would make even Robocop proud. It’s in stark contrast to the agency’s early days a decade ago – when it was launched by a then fresh-faced 28 year old Jarvie. He said, “The first 18 months were horrendous; a real slog. We really had to battle and were very close to being shutdown. A large win saved us nine months in, but then that client was bought out six months later.” However, the company now seems to be freewheeling on a momentum of comfortable confidence. Future expansion seems a logical next step for the company that has often been criticised by its peers for being a London wolf in tartan clothing.“It’s an interesting one from a Scottish perspective. We are a media independent who happen to be domiciled in Edinburgh,” he says. Global market“The market we operate in is, at the very least, a UK-wide market, but ostensibly it’s a global market. The problem is, Scotland is not an international advertising territory. It is part of another territory, the UK. Major multinational advertisers will not invest into Scotland, they will invest in the UK. For you to get a slice of that, you have to be at the table of the UK market.” Jarvie is far from apologetic for positioning Mediacom the way he does, arguing that the Scottish media buying scene retains a dominant sense of small-minded parochialism. “The Scottish market is killing itself. We have an issue in Scottish marketing and advertising that everything in Scotland should come to us by default. There is an over-reliance on the public sector, and a lack of ambition, a lack of daring that Scottish businesses have in our sector, to go outwith Scotland,” he says. “Most of our business is not from Scottish advertisers. They are national advertisers, and our growth has been fuelled yes, by the Scottish Government – they are a big part of what we do – but also by people like Autotrader, RBS, Standard Life, Baxters. Although largely Scottish brands, these are national, well recognised brands with international appeal. Our job is to ensure we have consistency and continuity in our business, to bring in world class advertisers to our operation.” But could the Government have inadvertently created – what some rivals describe – as a monster? Under the terms of the Single Framework Contract 199 public bodies, from Caledonian McBrayne to Royal Botanic Gardens in Edinburgh, are now eligible to use Medicom. If they all take the government up on this offer, Mediacom – who do not have the option of turning away this business - are in danger of being swamped. The flipside of this is, if they can take on the business, that it is likely others will never want to take the business from them. The cost of the account, complications of handling it and resourcing it might mean that Medicom is the only show in town for the Government, in other words a monopoly. Jarvie will not be drawn on this subject, saying only that when Mediacom went to retain the contract in 2007, there were still a number of agencies in Scotland who could still handle it “and its not any different now”. However, he does admit that any Government tender or public tender can have its difficulties. “It doesn’t have anything to do with your existing relationship or what has gone before on a previous contract. That doesn’t count for anything. The tender is the tender,” says Jarvie. “It is almost a mathematical exercise. We would always consider each individual tender based on what is appropriate at the time, regardless of what any other company might do.” Being part of the WPP group has also allowed Mediacom’s Edinburgh office to benefit from the economies of scale and enhanced buying power that comes from being part of a large ‘value pot.’ Some have criticised value pots for siphoning off work to London agencies within the group, where it can be carried out more economically, at the expense of regional opportunity and investment. However Jarvie says, this is simply good business sense. Attitude and expertise“Our market share in the UK is 29 percent of paid for media space in our trading arm. Mediacom bills over £1.1 billion pounds a year. It would be professionally incompetent for me not to use that leverage. The fact that we have it and use it is acknowledged and respected by our clients. The fact that our competitors criticise – I would say – is a great thing,” says Jarvie. “We are a London-based media independent with an Edinburgh postcode. What I mean by that is that we have the same attitude and expertise that you will find in any London media independent. We have strength in depth across our business that doesn’t exist anywhere in Scotland. No one has strategic planning in the depth we have, and no one has data analysts, no one employs econometricians, no one employs the skill and depth of digital research people we have. That has borne great returns for our business and our clients. “We are different, and have always set out to be different. If you are different, people will set out to have a knock at you. If you are successful and people don’t understand how you have done it, it is difficult for them to lavish you with praise.”
5G Lewis Hamilton MediaCom

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