The departure of long-time television investment executives at two of the world’s largest media agency groups, Omnicom Media Group and GroupM, underscores the changing television marketplace, accelerated by the pandemic.
At GroupM, changes to the investment team began in 2016, when longtime chief investment officer Rino Scanzoni left. He was replaced by another investment vet, Lyle Schwartz, who stepped down in March after 37 years with GroupM, just before lockdowns were ordered in the United States.
Schwartz’s replacement, Matt Sweeney, has a digital background as the former North America CEO of Xaxis and chief revenue officer at ad tech company Pixalate.
At Omnicom Media Group, chief investment lead Chris Geraci left the company in April as part of broad cuts at the agency. He held various executive investment roles at the group since 2002, including president of national video investment at OMG and managing director for national TV at subsidiary OMD. His role will not be replaced.
Omnicom Media Group recently shifted its go-to-market strategy for TV from an individual agency approach to a group approach, making certain investment roles redundant.
GroupM and Omnicom declined to comment.
“When you see tenured executives moving out, it can simply be a natural changing of the guard,” said Forrester analyst Jay Pattisall. “But it could also be representative of an agency workforce that is on the cusp of radically changing.”
The linear TV business, while resilient, has been transforming for years. As consumers cut the cord and ratings decline, old-school investment practices such as the upfront have been under scrutiny. The cancellation of the 2020 upfronts due to the pandemic could also be a watershed that modernizes decades-old ways of transacting.
“The economics of the industry, the talent drain due to layoffs and the changes in consumer behavior will permanently change a number of things inside the industry,” Pattisall said.
These shifts will cause big advertisers to rethink their media mixes long term, and agencies must reposition talent in response.
“Personnel shifts could be a result of an accelerated effort toward addressable and digital television,” Pattisall said. “Buying resources would need to be optimized as a result of that.”
Agencies tend to part ways with mid-level staff during downturns. But the unique nature of the pandemic means staff at all levels have been impacted, leaving tenured leadership with significant salaries – especially those that don’t directly bring in revenue – particularly vulnerable. Agencies are also trying to protect talent that works on client accounts, as opposed to people with external relationships with TV networks.
And in the current environment, cost-cutting might be necessary, but so is digital know-how.
“The media world is becoming less focused on the core planning and buying, and also includes much more data science, marketing content and consulting services,” Pattisall said. “That has accelerated under these circumstances.”