Mark Coad on Mediabrands’ COVID-19 response: ‘We’d rather overreach and give back than ask again’
After six months in the job, Mediabrands’ chief executive Mark Coad speaks with Mumbrella’s Brittney Rigby about handling a crisis in a new business, why pitching has become more humanised since ‘ditch the pitch’, and what media agencies and marketers should be thinking about. Here, in the first part of that interview, Coad clarifies the company’s ‘hiring freeze’, assures staff they will return to full capacity and pay in January, and explains why there’s no more local cost cutting to come this year because ‘we’ve done ours’.
At the end of April, Mediabrands’ COVID-19 response strategy, dubbed ‘Resilience 2020’, was leaked. Newly-installed chief executive Mark Coad had emailed staff, asking them to agree to nine-day fortnights, and confirming there would be a pause on pay rises and discretionary spending, and a small number of redundancies.
But there wasn’t a hiring freeze, according to Coad; he says those were Mumbrella’s words, not his. His all-staff email read: “We will cease hiring for the remainder of 2020 to preserve our current employment opportunities. Our hiring program is on hold, bar critical and exceptional circumstances which will be dealt with independently.
“This means that if a client pauses or radically changes their activity it will be our own teams who will be deployed to new opportunities.”
In a recent interview with Mumbrella, Coad clarifies that “we always made it clear that we’d be recruiting for necessary roles where we had to. And we also made sure that when we did have vacancies, we would look within to preserve the jobs of the people we had rather find new people”.
He confirms there “have been times since then where we’ve had to employ people because we don’t have the skillsets and we’ve done so, in limited numbers, given the circumstances”. But there was never a hiring freeze, he reasserts, “we never phrased it that way”.
“Are there instances where we need to employ people? Yeah, there are. Would our preference be to bring our guys back online from a full salary point of view? Yeah, that’d be our priority, but it doesn’t always work that way.”
Coad recalls employees asking him “what are we doing?” as the pandemic began to take effect locally. The former PHD CEO was “getting a bit anxious” to communicate the leadership group’s plan; he knew getting it right was a big opportunity to establish trust and respect with his new, 800-strong team.
“There’s no question we took a really considered approach to it,” he notes.
“We wanted to understand as best we could what the impact on the business was going to be. We needed to understand what the expectations of our stakeholders were. We had to think through some of the implications for people, and we just had to piece that together with the limited knowledge we had.”
The business was hardest hit in April and May, and reducing costs was inevitable.
“We knew that we had to find some costs in the business to address that in terms of the revenue reductions, but we couldn’t possibly mirror those reductions … so we had to amortise them over a period of time and we just worked through it,” he explains.
“If we had to achieve a certain amount of cost reduction to mirror the revenue reduction, how would we map that out and over what period of time? But having said that, we didn’t do it. We had to ask our people if they were happy to do it. So we sat down and worked through with them what the various alternatives, and we all opted into that.”
The measures, implemented across the holding group’s agencies, including Initiative and UM, are set to expire at the end of the year. Unlike some other media companies, Mediabrands’ program was designed to last the whole year, because it “want[ed] to do this properly, not quickly”. And the end date still sits at 31 December.
“If we can stop it earlier, we will. But it’ll certainly go no longer,” Coad says. “If we hit a catastrophe where we went into wave two and three [of COVID-19] and we had to, it wouldn’t be without further consultation and further opt in.”
At the end of July, IPG reported that its profits fell 127% in the second quarter, and chief executive Michael Roth flagged additional cost reductions of US$90m to US$110m in the second half. When asked if there’s an expectation for Mediabrands to cut costs further in the local market, Coad is adamant: “We’ve done ours.”
“You’ve seen it, we’ve done it,” he adds. “That was part of the brief that we received to readjust the business when we did. And we did it. Is there more to come in the second half? No. We haven’t planned for any more.
“Barring a second or third wave COVID catastrophe that is not going to happen, with all of our fingers crossed.”
Coad is currently planning for 2021 – “We’ve got some wins we hope to annualise into next year, we’ve got some clients who’ll come back online, and we’ve got some clients restoring marketing budget” – and is confident it will involve growth, even though “I’m pretty sure COVID hasn’t got a calendar”.
“Within the budgets we set, there’s going to be some revenue expectations as clients either restore their marketing budgets or come back online if they’re categories that have been really badly affected,” he says.
“And in line with that, we’ll be planning budgets to equal that, and that’ll be a combination of existing people, there’ll be new hires next year for sure as our business grows. So we’re not taking the  mentality at the moment into next year, we’re hoping COVID has got a calendar in that regard.
“We’d like to think there’s growth next year for us. And we’re planning accordingly. I think the whole market has that has that mentality, but like I said, we’re all seeing 2021 as ‘COVID is behind us’. There’s no guarantee of that. I’m an optimist, but we need to keep an eye on that as well.”
Overall, Coad is proud of how his team has handled a tough year. He’s all too aware that Mediabrands employees are “still enduring some of the consequences”, even if the worst is behind us. But “in hindsight, [the resilience plan has] worked pretty well”.
“On reflection, if we had to do it over again, knowing now what we didn’t know then, I don’t think our response would be terribly different,” he says.
“Our thinking at the time was we did definitely only want to do this once. We’d rather overreach and give back than to ask again.”
The CEO notes that stakeholders have entrusted him to manage the business effectively, which importantly means looking after its people. That was, and always has been, high on his priority list, he says.
“We wanted to come out of this as together as we could be, and we felt this [the plan] was a way of achieving that … When you can have an authentic care for [employees’] wellbeing and their ongoing employment, and you can demonstrate that you mean that, I think that goes a long way.”