It may not be apparent at first sight, but two companies that reported poor results last week have several things in common – losses and heavy bank debts being just two.
When you look more closely at Adventis Group and Media Square, what do you see? Sadly in both cases, they comprise a hotchpotch of marketing businesses none of which really sets one alight with excitement at either its creative calibre or client quality.
Of course that’s a sweeping generalisation and no doubt both groups can produce evidence of past awards and a few well known names on their client lists. Indeed some of the companies that have been acquired were once highly regarded in their field but the gloss seems to have worn off. However the overall impression that comes across is that most of the individual businesses are just not at the top of the league in terms of reputation.
And while that may seem like a statement of the obvious in explaining the losses the groups have incurred, it often remains a blind spot in the strategic thinking of would-be entrepreneurs and even established wheeler-dealers in the marketing sector. Perhaps a little more thought and effort needs to be devoted to product rather than profits. Get the product right and normally profits will follow. And getting the product right needs the right calibre of leadership and management.
Whether the wholesale clear-out of senior directors at Adventis will achieve that result remains an open question. As at Media Square, the executive reins at the top have been handed over to management consultants and financial wallahs with limited evidence of first-hand marketing expertise. They may get the bank debt down, but what will be left of the businesses afterwards?
Bob Willott is editor of “Marketing Services Financial Intelligence” at www.fintellect.com.