Frenemies: The Epic Disruption of the Ad Business (and Everything Else) (27 page)

“MediaLink is the embodiment of one zealous man's unwillingness to say no. Michael built a giant dating service between circles that don't know how to talk to one another. . . . He connected all these pieces. He has a rare ability to create a prom that everyone wants to be at.”

—Digitas CEO Tony Weisman

As his car inched along in clotted Cannes traffic, Michael Kassan's four smartphones vibrated relentlessly, a flurry of calls and e-mails pleading for a few extra invites to his annual dinner at the world's foremost advertising conference, the Cannes Lions Festival. Already he had approved four hundred media and marketing executive invitations to the exclusive June 2016 event he and MediaLink host at the Hotel du Cap, and some five hundred more people were clamoring to squeeze in. He had carefully added attendees to the $400,000 dinner from the cream of his media and platform client list, including NBCUniversal, Microsoft, the
New York Times
,
the Walt Disney Company, 21st Century Fox, Facebook, Google, Twitter, Condé Nast, Hearst, Dow Jones, the
New York Post
,
the
Washington
Post
,
Gannett, iHeartMedia, Viacom, Turner Broadcasting, Bloomberg, Flipboard, and Vox Media. He had included the holding company executives who often have a love/hate relationship with Kassan, wanting his favor yet fearing he might whisper to his brand clients they should move to a new agency. Brand clients like Unilever, AT&T, Verizon, L'Oréal, Bank of America, Colgate, and American Express were, of course, also invited.

No other gathering during June's weeklong festival—not those hosted by Facebook or Google with libations on the beach, or WPP's afternoon buffet and Stream conference on the adjacent island of Ile Saint-Honorat, or even a luncheon invite from Rupert Murdoch—is more coveted.

As usual, in Cannes MediaLink was performing a role that was a cross between curator and concierge. It dispatched a total of forty-five staffers to service ninety-one attending clients and participate in over seven hundred matchmaker meetings over the course of the week, not counting the onstage speeches and panels MediaLink arranged for clients. Each staffer organized about six meetings per client. Scott Goodman, the MediaLink vice president in charge of coordinating staff assignments, said most media clients first requested meetings with prospective advertisers, and then with agencies. “The event itself is the easy part,” Goodman said. “Even if you're the best wedding planner, the wedding itself is easy.” What's hard are the months of planning.

Michael Kassan's ready smile camouflaged the stress he felt in Cannes. “Just imagine,” he said as the chauffeured car headed to a dinner, “for five days at the end of June in a four-block radius on the Côte d'Azur, 100 percent of my revenue is there. Virtually every client is represented there. Here's the
Wall Street Journal.
Am I going to turn down Dow Jones? I'm going to say, ‘You can have four dinner invites. You can't have seven.'”

An e-mail beeps from Revlon owner Ron Perelman asking to bring
all the guests on his yacht. No, Kassan dictates to his chief of stuff, Martin Rothman, seated in the front seat.

Beep: An e-mail from a CEO at one of the companies that reports to his friend Bob Pittman's iHeartMedia, the powerful radio station owner who provides the dinner's entertainment. Pittman induced Chris Martin of Coldplay to perform this year, as he induced Sting in 2015, Mariah Carey in 2014, and Elton John in 2013. The iHeart executive asks for an additional five dinner invites. Kassan has a sly solution: “This is like when my son got married to the daughter of our best friends and we were making the wedding list and someone was friends with both sides. I said, ‘This is on your fucking list!' Am I going to be the guy who tells him no? I'm going to have Bob tell him no.” His chief of stuff makes a note.

In Cannes, too, Kassan is a celebrity. He gets the choice Hollywood star–named suites—Sean Connery, Sophia Loren, Cary Grant (renamed the Liu Ye suite)—at the festival's ground zero, the Carlton Hotel. He knows the names and embraces most folks who say hello or seek a private word. He slips from one meeting or panel to another, rarely staying long but always able to boast that he was there. Maître d's bow as he calls out their first names, no doubt remembering the many times he has generously schmeared them. After hosting a cocktail party Tuesday night, Kassan turned to his chief of stuff and asked Martin Rothman to book a table at the Le Maschou restaurant. Athough a long line in front of the restaurant snaked a good distance down the cobblestone hill, Kassan was immediately escorted to Le Maschou's exclusive outpost directly across the narrow street, where his party of three dined alone in a space that could accommodate maybe ten.

Tony Weisman, then the CEO of Digitas, which retains MediaLink to arrange meetings, speeches, and panels at industry events like Cannes, marvels at a feat Kassan pulled off here. Viacom was a client, and its CEO, Philippe Dauman, was on the cusp of getting fired, his
cable ratings plummeting, his pay climbing to $54 million in 2015 as his stock dropped like a rock. Dauman would host a dinner Thursday, and he tasked Kassan with producing an A-list of guests. “I would love to know what Philippe Dauman pays Michael to get the four holding company CEOs to attend his dinner,” Weisman said. One lure to attend was the reality-TV equivalent of watching how Dauman handled his pending corporate death.

Weisman salutes Kassan and MediaLink: “They do not have a competitor. MediaLink is the embodiment of one zealous man's unwillingness to say no. Michael built a giant dating service between circles that don't know how to talk to one another.” Brand clients like Unilever and AT&T, which in the past did not have to think about new ad tech or digital companies like Facebook, and publishers like Condé Nast or Hearst, which “didn't have to worry about knowing the brands” because the brands sought their platforms, were suddenly at sea. “He connected all these pieces. He has a rare ability to create a prom that everyone wants to be at.”

The Lions festival
was launched in Venice in 1954, alternating between several cities, including Cannes, before making Cannes its official home in 1984. Initially, it was naturally dominated by the creative agencies. Philip Thomas, who was the CEO of the Cannes Lions before being promoted to CEO of Ascential Events by its corporate parent in 2017, remembers that in 2003 Jim Stengel, then CMO of Procter & Gamble, was the first client to make a point of attending, and this represented “a big, big shift. That attracted more of the media agencies.” Today, Thomas says, clients comprise one quarter of all attendees. Next came the digital companies, then the media and publishing platforms, and most recently, the consulting and software companies. A breakthrough in getting celebrities to attend and bulking
the press contingent up to six hundred, he says, was the arrival in 2014 of Kim Kardashian. “The
Mail Online
were very, very clever. They took a yacht at our festival” and invited her. It was the same year that the festival invited her husband, Kanye West, to appear. The
Mail
“got blanket coverage,” providing an incentive for celebrities to flock to the festival. Hoping for buzz, more companies hired yachts or gave opulent beach parties and invited celebrities.

Some old-timers, like Bob Greenberg of R/GA, are devoted to Cannes. R/GA brings thirty executives. “I go and I come back and I can see patterns,” he says, whether it is glimpsing the disruptive power of WeChat in China or digesting the creative work of competitors. Not all of his creative colleagues are as enamored. Jeff Goodby, who was anointed president of the festival in 2002 and head of the prestigious Titanium jury in 2006, is troubled by what he sees as a diminution of attention for creative advertising. “It's about making money. It changes everything,” he says. It changes the festival, he has written, into “a plumbers' or industrial roofing convention, after which I go home and begin to explain to a friend that there is an amazing new fiberglass insulation technology.”
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The Cannes festival is owned by Ascential Holdings, a company based in the UK that organizes festivals and exhibitions, and provides economic information and analysis for clients around the world. The Lions festival is a lucrative business. Each of the fifteen thousand delegates who attended paid as much as 3,750 euros (approximately $4,400)
*
for the full eight days with “line-skipping privileges,” or a somewhat lesser amount for fewer days and perks, down to 895 euros “for students and professionals under thirty.” Each agency from the 110 countries that attends and submits creative entries in one of the
twenty-four Lions awards categories pays an average of 500 euros for most entries, rising to 1,399 euros for the most prestigious prize, the Titanium Lions. In 2016, there were 43,101 submissions and 1,360 Lions awards presented. If only four awards were given in each of the twenty-four categories (Grand Prix, Gold, Silver, and Bronze), the total number of winners would only be ninety-six. Cannes inflated the number of winners by giving multiple prizes for each category.

A third Lions source of revenue comes from its four hundred event sponsors, who Thomas says, pay from $20,000 to $700,000. This includes the cost to Samsung of its virtual reality exhibit, and the total of $300,000 for MediaLink's sponsorship, and two large LED electronic screens on the lawn outside the Carlton Hotel, which clients like the
New York Times
and the
Washington Post
subsidize to carry their news flashes and promos. Other revenues sprout from its archive of speeches and talks and ad campaigns presented at the festival or at its three regional festivals. (For 18,000 euros, 20 employees in a company get digital access for one year to 270,000 ad campaigns and 450 hours of talks.) Yachts receive a parking spot in the harbor plus five festival passes for $22,715. In all, the 2016 festival hauled in $62.5 million for Ascential.

Attendance is pricey, and not just because a Black Angus chateaubriand in the Hôtel Martinez costs $161 and Delta raised its round-trip first-class nonstop New York to Nice flight from $5,332 to $12,069. In addition to the attendance fee, MediaLink pays for its forty-five staffers' airfare, hotels, and food, plus the Hotel du Cap dinner they host, plus the separate Kassan-hosted Boys Night Out sponsored and mostly paid for this year by Hulu, and the Millard-hosted Girls Night Out party cohosted by Facebook and iHeartMedia. The cost to holding companies like WPP and Publicis works out to about $20,000 per employee. WPP had a thousand employees attend in 2016.

The awards are especially prized. “Awards fulfill a function in our
industry,” Philip Thomas says. Since choosing winners is subjective, “the only way to prove you're creative is the external acknowledgment of an award.” Bob Greenberg's loftlike R/GA offices at Tenth Avenue and West Thirty-third Street contains a shrine of six walls of trophies and plaques, including the thirty-three Lions R/GA won last year, when he was also awarded the coveted Lion of St. Mark lifetime achievement award. Greenberg extols the awards: “By winning awards you are proving to clients you are good. It's not that different from the movie business. The attraction for me of the rewards is to attract and retain talent.”

Amir Kassaei, the chief creative officer at DDB Worldwide, disagrees. Although Kassaei says his agency had won more Grand Prix Lions at Cannes than any agency, nevertheless he wrote in a 2016 newsletter that winning awards took too much time and money and did not prove the effectiveness of the advertising. He pledged that DDB would vie for fewer awards. Why? “Because we believe that winning awards only means that you are good at winning awards. Because we care more about selling our clients than ourselves. Because we care more about emptying our clients' shelves than filling our own with trophies.”
*
(Kassaie's words are not matched by his agency's boasts. If one clicks on the DDB Web site, it touts the hundreds of creative awards won, including almost a hundred Cannes Lions.)

Strolling along the Croisette across from the Carlton on the way to the Palais, which houses multiple theaters where awards are presented most nights and where a crowded program of daytime speeches and panels occur and ad campaigns are displayed, one passes what Jeff Goodby has described as a strip mall of vendors. The festival calls this part of the Croisette, which overlooks the beach, Cabana Town. Along the way one strolls past the buildings containing the IBM, Oracle, Adobe, Accenture, PricewaterhouseCoopers, McKinsey, and Deloitte
cabanas, among others; on the sand below are the private beach spaces—Facebook Beach and Google Beach and YouTube Beach, each featuring exhibits and talks and free-flowing rosé.

Walking past these consulting and tech company cabanas in Cannes is a reminder, if any is needed, that space at the marketing table is getting crowded. These companies have gobbled up ad and marketing agencies. In the two years before Cannes, IBM absorbed thirty-one marketing companies; Accenture bought forty; and Deloitte twenty-six.
*
Advertising Age
has reported that eight of the top ten ad agencies are not traditional ad agencies but consulting and tech companies.

Looking back at Cannes
is also a reminder of another marketing change. No, not Unilever's Keith Weed's chartreuse sports jacket, one of two gaudy green jackets he brings to Cannes every year. With the jackets and his thick head of blondish hair that flops over his forehead, he could pass for an aging British rocker. Weed's Wednesday keynote to an audience packed into the vast Grand Théâtre Lumière was billed as “The Future of Brands.” He made the case that to successfully engage with consumers in the future brands must convey that they are “a purpose-driven business.” Weed and an increasing number of brand managers believe this is what younger generations expect. The way to win their trust is to demonstrate a social purpose. He displayed a number of film clips and Unilever commercials warning of climate dangers like deforestation, spoke of how their Ben & Jerry's brand promoted gay marriage, and showed a clip from a film Unilever made for a conference of world leaders that ended with their CEO, Paul Polman, declaring, “Help us by adding your voice in the battle for climate change.”