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‘Fortunate to work for a company that has never rested on its laurels’

By Rajiv Raghunath - October 21, 2022

NOVUS, an independent media planning and buying agency headquartered in Minneapolis, USA, has had a riveting l business journey since its inception in 1987. From being a top print buyer in North America, the agency has evolved its offerings to deliver customised, fully multichannel media programmes, strategic planning, data and analytics and marketing services to advertisers and agencies across all major industries. Melony Rios, CEO of NOVUS Media talks about the business journey in an interview with Rajiv Raghunath.

NOVUS was a print media-centred agency. What factors propelled the complete makeover of your business?

Two things. NOVUS has a history of transformation. Looking back to when I started 22 years ago, we transformed the way we thought and worked…  augmenting our operating models to address marketplace changes, evolving customer needs and new client segments. While we did this in the realm of print, rethinking our business model to deliver breakthrough value for clients was not new to us. I’ve been fortunate to work for a company that has never rested on its laurels and has maintained a culture and mindset of thinking two steps ahead – regularly evaluating how we can deliver and maintain a compelling and competitive marketplace advantage for our clients. As a result, we went from a small print agency specialising in direct response remnant newspaper advertising to the largest buyer of print media in North America representing some of the biggest brands – many of which we still work with today.

Melony Rios, CEO, NOVUS Media, USASecond. Over a decade ago we were seeing signs of deterioration in the print marketplace. Consumers were shifting time spent with media to rapidly evolving digital platforms. Advertisers were feeling diminishing returns on print ad spend and shifting to higher ROI channels as a result. And as newspaper properties were merging and/or acquiring other newspaper properties, they were quickly thereafter removing print impressions from the marketplace to optimise and control costs. It was this 3-headed monster eroding the future of print advertising that we did not ignore. In fact, we embraced it in two ways. First, we leveraged readership and media mix modeling data in our print buying and planning methodologies to maximise as much return as possible for our print clients. And second, we launched a digital practice and began shifting low performing print media dollars into geographies where our response curves indicated digital would deliver a higher ROI.. We applied, frankly, very similar tools/tech and insight “machinery” used in our print buying approach… to our digital buying approach and it worked. In fact, our print and digital programs were generating ROIs (as measured by 3rd party media mix modeling partners) for clients 2-3x better than traditional approaches and 1-1 digital campaigns.

What were the major challenges that you faced as you steered the change in business focus?

Transformation in general is hard.  70-95%  is the published percentage of companies that attempt to transform but fail.

We had two major challenges out of the gate. First, we needed to address the skills in our organisation which is a humbling but necessary exercise. We recognised early on that while we had a company filled with remarkably bright, entrepreneurial individuals, we needed to add new intellectual horsepower to the machine. Most of our existing key stakeholders had day jobs anyway and freeing up their time to focus on transformation was not realistic. We needed to find and hire individuals with rich multimedia experience, strong track records of delivering results for clients, and who were willing to embrace taking a chance on a newspaper agency in the midst of transforming its business.

Think about that for a second. Trying to recruit the best of the best in multimedia by asking them to quit their day job to help transform a print agency with no guarantee it would work. But we did. Our success stories in print resonated and we learned many other agencies hadn’t cracked the code on local media in the way we had with print. We made a handful of key executive hires. For example: Montrew Newman, a 20+ year Omnicom veteran who today is NOVUS’ Head of Strategy. And Rob Davis, a 25+ year Executive who ran some of the biggest global brands for Publicis. Rob is NOVUS’ CMO and the President of our multimedia practice.

Today, we have a high-powered multimedia team made up of individuals with rich media backgrounds, diverse client experience. And we’ve successfully transitioned a significant number of our print-legacy talent into our multimedia practice.

The second challenge was facing the reality that the “NOVUS brand” didn’t do what we had expected it to do. Our 25+ years of excellence in the print market didn’t play favourably in the multimedia space like we had hoped. In fact, it often worked against us as marketers who knew us as print couldn’t “get passed” the fact we were a print agency. We spun off a division called “Novus Next” as a remedy… and it helped significantly. Interesting story: we participated in a multimedia AOR RFP in 2021 with 20+ other agencies. The prospect shared their concerns with the RFP consultant that “they knew NOVUS and they could take NOVUS off the list” as the prospect was remembering the “NOVUS” from our early days. The consultant suggested to keep NOVUS on the RFP list knowing we had changed significantly from our early days. And believe it or not, NOVUS went on to become the AOR for that client.

Back to the transformation.. and adding talent. So at this point we had invested in new intellectual horsepower, new tools, new tech and a new division name (Novus Next) that we believed would all contribute to taking us to that next level. At first It was slow going, you now  - writing a new narrative for your company – especially one that has been so specialised for decades – is hard.  But we were seeing signs of success. We were winning small-medium assignments here and there, but the important part here, is that we were making remarkable strides in driving results for these clients. And each of these was a case study for the next client win.

And before we knew it, we had a nice little roster of multimedia clients. Our revenue mix was about 90% print/ 10% multimedia heading into 2020. Note: Today it is 40% print / 60% multimedia. And then Covid hit.

Like many companies, we moved quickly to protect our employees and our clients’ businesses. We shifted over 150 people to 100% remote work in two countries and didn’t miss a beat. We kept an intimate pulse on clients, vendors, strategic partners and kept everyone up-to-date on Covid/marketplace learnings. We were cancelling campaigns and adding campaigns.  Running models to understand financial impact to business under a number of “what if Covid” does xyz scenarios. But I think the key here is that we didn’t spend 100% of our time on survival tactics. Once we were semi-stabilised, we got back to work. And I remember asking my team, what do we need to do to come out on the other side of this better than we were before? In print? And in multimedia? We stayed focus on protecting our print revenues while simultaneously growing our multimedia practice.

Ironically, Covid accelerated some of those multimedia growth opportunities as marketers quickly began to understand the value of planning media through a local lens. 

In broadening the scope of activities, do you see the opportunity of working on Out of Home advertising / branding for clients?

We have a robust OOH practice in Canada planning and placing OOH media on behalf of a few dozen clients. In the US, OOH has become an integral part of our local multimedia practice leveraging both static and DOOH. In fact, when we placed our submission for Ad Age’s 2022 Ad Agency of the Year award, the case study we submitted included a clever use of OOH for a regional low-price grocer. We went on to win Ad Age’s Agency of the Year Silver Award. Which as you can imagine was huge for us. We were getting recognition from clients, but now from the market that we had, in fact, arrived in the multimedia space.

In this age of omnichannel marketing and integrated communications, how do you plan to strengthen NOVUS’ competitive positioning in the addressable markets?

From a capability perspective, we can and do plan and execute addressable 1:1 media campaigns.  We leverage 1st and 3rd party data to target specific subsets of audiences to deliver the right message to the right person at the right time. In terms of how this fits into our positioning in the future, it’s important to keep a few things in mind when it comes to  “best in class” 1-1 marketing:

First, “addressable” requires significant investment by the client’s data infrastructure team  - for example strong CRM, investment in a CDP or the aging DMP. Secondly, client’s marketing department (they likely must partner with a safe haven like LiveRamp to merge data sets in a compliant way). And third, agency capability  - does the agency know how to bring the right media partners, measurement, analytics, activation teams, and planning teams to properly leverage all of this data, again in a privacy and legally compliant way?

All that said, we can do this today if a client has 1st party customer data we can facilitate uploading that directly into a platform like Google or Facebook, or pushing to LiveRamp that will give us customer IDs that we can match within our own DSPs.  However, we frankly don’t have a lot of campaigns needing this level of capability right now, because what accompanies best-in-class addressable are a lot of costs.

Addressable is just one technique out of many available to marketers to reach a desired audience and business outcome. We don’t think it’s necessary or appropriate to bet our future on it. In fact, we have found that our unique angle gives us a way to leverage our knowledge of local to appropriately target DMAs, zips, radius from store locations, etc. which does not require additional targeting or data costs to effectively reach our audiences based on where we know that they live, work, or play.

It’s not lost on us that at times we will reach people not within our target audience. However, we know some ad waste is actually less costly than the data costs needed to eliminate that waste.

In some scenarios, if needed to achieve our objectives, we will layer additional targeting (and the accompanying data costs) but only if it produces incremental results beyond investment required.

Will 1:1 be a thing in the future? Yes, but we think likely with more individual control. With the right value exchange, most consumers will share their personal information with a company which fuels 1st party data enabling future 1:1 marketing. Also, 3rd party data will still probably be a thing, but again with some sort of value exchange with customers allowing them to opt in.  Finally, the addressable audience pool sizes will go down as more and more opt-in is required. We believe this is where our approach plays favourably in the future - uniquely harnessing the powerful lens of local and geographical insights to drive better returns.

Is programmatic media buying redefining the way agencies function?

Programmatic hasn’t necessarily redefined how we function as an agency, but it has certainly impacted and revolutionised areas of our business. How we work, our organisational structure and so forth. But that should not be a surprise given the significant changes in our business model and frankly because programmatic has revolutionised the traditional digital, video, audio and OOH advertising. The trend will continue, yes … but the future of programmatic in a cookieless world remains unknown. The end of cookies doesn’t mean the end of ad targeting – what it will mean is that marketers will need new solutions that can still deliver results.  This, of course, plays into NOVUS’ unique approach and frankly our sweet spot.

Where do you see NOVUS in the agency business in the next 2-3 years?

Our rapid transition into multimedia and client results suggest we are here to stay. And we are positioned to make meaningful marketplace impact in our work.  We are now competing with some of the largest public and independent multimedia agencies in this space and winning. We are attracting more and more top talent from top agencies. Which means we are doing something right. Evidence, as marked by the change in our revenue streams, client mix and frankly better business outcomes for clients indicates we’ve carved out a white space that has tremendous potential. We think an exciting future awaits!


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