By Will Waugh
Normally I don't comment on AdAge articles, but the article this morning titled 'How private equity is reshaping marketing' (sub req'd) struck a cord. Why? Some of the key points:
- Accountability - This has been the #1 issue for marketers for three years running now. This quote by 2x Management's Andy Whitman says it all: "The fact that private-equity marketing executives are compensated based mainly on profit and enterprise value also helps solve marketing's return-on-investment problem."
- Marketing Talent - Another challenge for our CMOs and senior marketers. Our Annual Conference keynote, AG Lafley, said that private equity is his largest competitor for talent. Marketing recruiter Barbara Pickens said, "Five years ago it was almost never part of the conversation." Innovation and accountability are the two most valuable traits of today's marketer (in a nutshell). Perhaps by seeing the talent drain to industries like private equity, brands and companies will hold a higher value on their marketing brain trust.
- Agency Compensation - This one is close to us as our 14th triennial agency compensation survey results come out in May. In the face of a changing marketing model, private equity is buying up specialized shops, adjusting them for this new world and offering them to the highest bidder. Advertiser's issues with agency overhead, agency executive compensation and the like become moot points because these shops are reorganized for efficiency. Value based deals (which we are seeing more and more of) hold long term value to private equity firms because they are not one-off deals.
Technorati tags: private equity marketing accountability talent
Recent Comments