Bill Cella proposes nothing less than to “rebalance” the business of buying and selling television advertising, and as the chairman of Magna Global USA, he’s one of the few people in a position to do it single-handedly.
In the new post-consolidation world, where just a few globe-girdling behemoths control most programming inventories and distribution, Magna, the newly formed negotiating arm for the Interpublic Group’s Universal McCann and Initiative Media units, is meant to be the counterforce.
Approximately one of every four dollars spent on TV advertising in America next year will pass through Magna, which was officially formed in July 2001.
If you tell him he’s the $8.6 billion man, the soft-spoken Mr. Cella just smiles wryly. His midtown Manhattan office, filled with sports memorabilia from his days as a VP at ABC Sports Sales, is remarkably small and unprepossessing. In any show-business typology of power, you would characterize him, based on his manner, as a whisperer rather than a shouter; a man who wields power with a smile rather than a sneer, one who makes deals without making enemies.
EM: What was it that made you take on all this?
Mr. Cella: Here’s the gestation of it. There is a company in Germany called Intensive Media. It exists today and has existed for the past several years. It’s a buying entity on behalf of Initiative Media and Universal McCann in Germany. They’ve been negotiating for several different media, not just national broadcast, for a bunch of years. And it works. There are efficiencies of scale.
So the thinking last December, when a bunch of us got together, was to roll out an Intensive globally because of all the consolidation that was going on.
And of course what’s happening in the States is another factor. So we saw that, and we said, `Let’s introduce this on a global basis.’ So we started to talk to Initiative … about where we thought the market was going, what the opinions of the market were, what the history was. And it was fascinating.
So we were doing that, and we wound up doing it with True North, too, when True North became part of Interpublic. And it became a very fascinating picture.
The picture of this [past] upfront became dreadful, because we saw that budgets were down across the board-and not insignificantly. We saw it early, probably in early April.
So the upfront gets started and doesn’t go anywhere for several weeks because the sellers didn’t have the picture we had.
EM: In the broadcast upfront, you were in an advisory capacity?
Mr. Cella: We were not Magna as an entity then. We were more still sharing information, but we were sharing it with our sister agencies to make sure that everybody was getting a square deal. But we went to the cable market as Magna because we felt that we wanted to get some learning [curve] before next year’s upfront.
EM: So this was Magna 1.0?
Mr. Cella: You got it. Went to the cable upfront, and aside from the fact that it was cumbersome and laborious and burdensome and took a long time, it worked. To an extent.
And we’re still going through the good points, bad points, best practices, what we do well, what can we improve stage as we prepare for this year’s upfront.
EM: What was the measure of it working in the cable upfront-that you drove the CPMs down?
Mr. Cella: We feel as though we did that. We communicated with one another as an entity. The communication to the networks was a little bit burdensome and troublesome; some were not happy with the way it proceeded. And I admit it, because we weren’t set yet.
EM: What was the worst and what was the best in this process?
Mr. Cella: The best was that the Interpublic companies that we represented really, really embraced this and communicated well with one another.
The worst part of it was it took too long. There was some miscommunication with some of the networks. Our biggest challenge is to streamline the process, make ourselves be more user-friendly.
EM: What was burdensome for the networks?
Mr. Cella: The contact points were kind of hazy for them. Who should they deal with? Should they deal with someone from Universal McCann? should they deal with someone from Initiative Media? Who’s our point person? It was really sort of a communications challenge.
EM: What’s on your agenda now?
Mr. Cella: The advisory council [which consists of the heads of the buying departments of each of the agencies] has bimonthly meetings. We talk about issues-nothing proprietary. We’re now going to design a format on how we go to market. We may assign people different networks, we may assign people different dayparts.
EM: Different conglomerates too? How about cross-platform deals?
Mr. Cella: Right now we’re national broadcast, strictly. I envision Magna being the ultimate cross-platform environment. Once we create a footprint on how we go to market and how we address the networks, then we’ll bring other media in-print, magazine, direct response.
EM: Where are the goalposts for the next 12 months?
Mr. Cella: Magna’s goals are to create more value for our clients in the marketplace, be it price, be it marketplace knowledge, be it models of the marketplace so they can see the future a little bit.
EM: Do you expect this buyers’ market to continue?
Mr. Cella: We’ll probably be in a flat mode for several quarters. It’ll probably take three or four quarters for the market to start picking up significantly.
EM: Can you affect this market with the dollars you control, just from this office?
Mr. Cella: Yes. With the volume, we can make a market. Networks probably can’t close a market without our business. So we are very sensitive to that.
But the most important part of Magna I think is the knowledge base that we are going to create. When we’re able to look at volumes of dollars and at certain dayparts, we can create models that really get a strong look at where we think upfront’s going to be, where we think scatter’s going to be.
Knowledge is power. The more knowledge we have, the more information we have to give our clients so they can better plan. That’s pretty awesome.