In the latest episode of the ‘Ad Lib’ podcast, the MDC Partners CEO opens up about his first six months with the holding company—and what to expect next
“Coming out of WPP and working at Microsoft as head of advertising and chief strategy officer, I said to myself, ‘What would the holding company of the future look like and what would it have to have?’” Penn says on the latest episode of the Ad Lib podcast.
In teaming the creative assets at MDC with the tech and data flywheel at Stagwell, he says, he could see a way towards scale “and also manage costs the way they are at the other competitive holding companies. … There are five Droga5s sitting inside MDC and that’s what makes it an incredibly exciting place.”
A former chief executive of the WPP-owned communications firm Burson-Marsteller, Penn was also a co-founder and CEO of Penn Schoen Berland, a global market research firm. He has also held senior corporate positions at Microsoft, and has served as a senior adviser to corporate and political leaders including Bill Gates and Steve Ballmer, UK Prime Minister Tony Blair, Senator Hillary Rodham Clinton and President Bill Clinton.
He has been vocal about cutting operation costs and making MDC more collaborative across its holdings, which had previously operated independently. Toward that end, in July MDC Partners announced it was integrating media agency Assembly into a new network with Gale Partnersthat combines media, technology and data. Also pulled into the network were agencies EnPlay, Unique Influence, Varick and Trade X Partners.
It’s a model he plans to replicate throughout the holding company, though he says he is aware there are individual shops that will need to retain their individuality—and there are agency founders within the holding company that are approaching their earn-outs.
“My strategy with the founders: Give them a bigger job; give them a bigger future at MDC. You want to keep the founders in terms of growing the culture,” he says. “Smaller specialty companies who felt somewhat adrift, now they can be part of an organization that’s going to do more efficient marketing and help us get more clients in a way that MDC wasn’t doing. … My goal here is that there’s a class of contracts that individually these agencies, no matter how great their creativity, are not able to bid on. Companies with lesser creativity, lesser data operations, are scooping up because they’re slightly bigger at scale.”
Case in point, MDC is in a cross-holding company pitch for Kimberly-Clark led by creative agency 72andSunny, the first of its kind for the company.
“It turned out no one had ever really done an MDC pitch before,” says Penn. “Win or lose, we are learning we can get to be a true holding company by working together.”
We get to what’s next for MDC, a publicly traded company, and how he simultaneously operates at Stagwell, a private equity firm. We also talk a bit about his background. The former political advisor hasn’t been shy about offering commentary on Fox News in recent months in defense of President Trump at the end of the Mueller hearings on the Hill. (Asked if he’s actively providing counsel to the president or any candidate currently declared for the 2020 election, he says, emphatically, no.)
“I did a little commentary because I spent some time—a year of my life—defending president Clinton on impeachment,” he says. “I’m pretty busy now. My commentary is trending down.”
The interview was recorded just hours before House Speaker Nancy Pelosi announced a formal impeachment inquiry into the president on Tuesday, Penn doesn’t go there. But he shares what he learned from working with leaders including Ballmer and President Clinton. And he explains how running a business is like running a political campaign.
“You need to have five things: A slogan people can remember; you need to have a bio, people need to know who you are; you need to have a target; you need to have issues; you need to have a pushback against the competition,” he says of running a political campaign. “I don’t think it’s any different running a business.”
Source: Ad Age