Launched in the UK in 1990, acclaimed media and communication agency network PHD Media was the first media agency to offer strategic and creative planning, and today has more than 6,000 people working in over 100 offices worldwide.
CEO Mark Jarrett is proud to lead Australia’s fastest-growing media agency. PHD has been recognised by the Australian Financial Review (AFR) as one of the most innovative companies in Australia for four consecutive years, and was voted AFR’s Number 1 most innovative company in the media and marketing industry in 2022. Mr Jarrett’s communications planning background reflects a passion for understanding what motivates and drives people, and his long media career has afforded him insight and experience across almost every major category, including Alcohol, Finance, FMCG, Automotive, Telecoms, Travel, Government, and QSR. Mr Jarrett spoke with us recently about PHD’s strategic and creative approach to media and advertising, the current industry issues for the advertising space, and the importance of understanding how to achieve clients’ unique business needs.
Advertising and media investment
“People who know the [advertising] space a little bit would think of PHD as a media agency,” Mr Jarrett says. “What that means for us is a strategic and planning driven agency that also looks at communications planning and how to connect with audiences that our customers – the businesses we deal with – want to sell their products too.”
PHD converts these insights into a media buying strategy, which includes traditional media such as TV and outdoor, as well as digital media like Meta and Google. It also works with clients to analyse data in order to understand consumers.
“On a very simplistic level, [our clients] are looking for a return on their investment. People often talk about ‘media spend’, but we’re really talking about advertising and media investment. Depending on the type of client and their approach, they need to drive sales either now, in the short term, or sometimes they’re looking at the longer term – how do they create advertising that will benefit their business over the next few years.”
The most recent studies show that sales are generally driven by taking a broad and long-term approach. This contradicts many business cycles, however, where results are needed within much shorter timescales.
“You can go both wide and deep. One example is a client of ours, Virgin Australia. They run broad, brand awareness campaigns. Bring on Wonderful is their current brand campaign that is focused on telling all of Australia about their service, creating value for the brand.”
Alongside this, Virgin Australia also takes a different, deeper approach. PHD helps them optimise against all flights, making sure that they are filling seats for every single flight and every single route they fly.
“The most important thing is actually understanding what we’re trying to achieve. Sometimes that gets lost, and it becomes about advertising, reaching people with a message, and creating awareness. For a client of ours, that’s not what we’re actually trying to achieve. What we’re trying to achieve is their business goals.”
Although these business goals all boil down to sales, in some shape or form, there are plenty of nuances within the needs of each client, such as timeline or price. This means that PHD must make sure it understands exactly what needs to be delivered.
“It’s also measuring that from the very beginning to the very end of the campaign,” Mr Jarrett adds. “Often advertising gets put out there without people understanding what they’re trying to achieve.”
In terms of the details, it’s about identifying a specific audience which will respond to tailored messaging, whilst also understanding the wider audience the brand needs to reach. PHD works out how to do that in the most effective way and identifies which channels offer the best means to do so.
“It’s about understanding what we’re trying to achieve, the most efficient way of delivering that in terms of targeting people, and then negotiating with those media owners to get the best quality, the best placement, and the best rates.”
In the middle of a difficult business environment, the advertising sector is down around 5.5% at the beginning of 2023 in terms of holistic advertising. However, government and tech advertising account for nearly 4.5% of that downturn.
“The government downturn is because of big spending around the Federal Election last year, and I’m sure everyone is more than aware of the Tech woe. The market is down 1% if you take those out – that’s not great, but it’s not a complete disaster.”
Mr Jarrett believes companies are actually in control of more than they have been over the last 3-4 years, where the COVID-19 pandemic, the talent crisis in Australia, and other factors put a lot of uncontrollable pressure on businesses.
“We’re now in a market where we’re in tough times, but we’re also in control of our own destiny within that. So it’s difficult, but it’s not impossible. There are sectors that are actually on the up within these economic environments as well.”
Evidence suggests companies that invest during such a downturn have a greater market share at the end of the downturn. As soon an upturn begins again, those with the biggest market share always see a disproportionately large return in terms of sales and income.
“Many private companies continue to invest through downturns because they know in the long term they are going to make significantly more money, significantly more sales, and gain significantly more market share by taking that approach. The only challenge they have is that it is a long term strategy that will pay off in several years’ time. This can be difficult for listed companies where a quarter is often their maximum timeframe.”
In terms of the industry as a whole, the current Privacy Law reviews are an area that will change the landscape in the coming months. A recent report published by the Australian Government will drive changes in the law to ensure greater privacy for consumers.
“At the same time though, that will change the level of targeting, especially in digital media, that companies and advertisers can use. It’s important for companies to understand what’s going on in that space in the next 2 or 3 years. The risk of people having data breaches within the first party data – the information consumers share when contacting your business directly – is probably high.”
This means that all businesses, big and small, will be well advised to keep an eye on happenings with the new data privacy laws. In terms of risk assessment, this will be an area under a lot of scrutiny over the next few years.
Built on a culture of smart strategic thinking, creativity and innovation, PHD delivers effective solutions for the business needs of a diverse client base. Find out more about PHD Media by visiting www.phdmedia.com.