Interpublic's Michael Roth: Ad industry diversity still 'fairly pathetic'

Roth told Spikes Asia that diversity and inclusion are business imperatives that have played a big part in his company's recent turnaround.

Michael Roth
Michael Roth

A notably relaxed Michael Roth, global chairman and chief executive of Interpublic, told a Spikes Asia 2019 audience that commitment to inclusion is not only an important initiative but a competitive advantage.

"It's a business imperative," he said. "It's not just because it's the right thing to do. Fifty-seven per cent of our managers are female now, but if you look at our industry, it's fairly pathetic in terms of representation of women. And then when you look at people of color and Asians and… we just don't represent the marketplace, as an industry."

Advertisers not only respect a company that emphasizes representation, but are also demanding it, he added. Roth claimed that having managers accountable for reaching diversity goals isn't a tick-boxing exercise, but part of a wider commitment to doing the right thing. 

"This is a business of communication," Roth said. "How can you communicate with the consumer and do quality work and represent your clients in reaching those consumers if you don’t understand the consumer? And if you look at the marketplace, the consumer is diverse individuals."

That Interpublic has been outperforming its peers for a number of years now is no accident, Roth claimed, because his goal after taking the top job was to create a holding company that was different from others.

Roth discussed the holding company model and how strange he found it when he first joined the Interpublic board (before taking the chief executive role): "If you look at the history of the holding companies, the genesis was to do hundreds of acquisitions and just have these disparate businesses with no connection at all. And the holding company – all they did was count up the profits. And that was it."

The process of hoovering up businesses "with frankly no great thought to the strategic plan for the future" was a "formula for disaster", he noted.

Besides disposing of 50 or more businesses in two years to focus on core capabilities, Roth said Interpublic's turnaround depended on a single message getting through. "We became very client-centric," he explained. "This business wasn't about just our own siloes. It was about meeting the needs of our clients."

The focus was on building entrepreneurial spirit and fostering collaboration. But, importantly, he said, Interpublic still believes in the power of its agency brands, so it has sought to maintain their distinctiveness while boosting integration. 

"That's who clients like to deal with," he said, referring to brands such as McCann, UM, R/GA and Initiative. "That’s who people want to work for. That's where their careers are."

Roth welcomed other holding companies' tendency to continue to "focus on things that are not client-centric and not human-oriented", adding: "We'll continue to outperform."

After showing a piece of Cannes Lions Grand Prix-winning work for Ikea that focused on 3D-printable add-ons that make the brand's furniture more accessible to those with disabilities, Roth elaborated on the impact of such work.
"It's not just the consumers that are using the product," he said. "Think about how people think about that company now. [This kind of work] develops a relationship that can't be broken. And, in today's world, when everybody is fighting commerce competition and price competition, the only way you can compete with that is to develop the value of the brand."

Meanwhile, Roth defended Interpublic's $2.3bn acquisition of data-services company Axciom, saying that some people still misunderstand the importance of the purchase.

"Two-thirds of the Axciom business is first-party data management," he explained. In that capacity, 50 of the top 100 companies and financal institutions entrust it with their data. "If you take that competency, and overlay the issues today with privacy, for example, and couple that with our creative capabilities and media capabilities and PR and experience – all together, that’s the holy grail of our business. And we're seeing positive results."

A version of this story first appeared on Campaign Asia-Pacific

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