• by David Kaplan , May 13, 2005

A day after suffering the loss of the $3.2 billion General Motors media buying account, Interpublic Group sought to change the subject with the appointment of Mark Rosenthal, the former MTV Networks chief operating officer, to oversee the holding company's media properties.

As chairman and CEO of IPG's media properties, Rosenthal will be based in New York, and will oversee all of the company's worldwide media operations, including Initiative, Magna Global, Universal McCann, and a number of leading specialist media agencies.

IPG's special GM-dedicated agency, GM Mediaworks, Detroit, had handled the business for five years. It was the latest in a string of setbacks plaguing the holding company over the past year: IPG's Universal McCann lost Nestle's estimated $550 million U.S. media account, and IPG sister Initiative lost roughly $650 million in European media business it handled for Unilever.

There have also been defections to other media agencies. Most recently, UM's top researcher, Jim Kite, left to join MediaVest last month, a week after fellow "communication architecture" founder and Chief Strategy Officer Mark Stewart, exited for Omnicom's OMD unit as managing director for its eastern region operations. Last November, Marston Allen, director of the Universal unit, also joined MediaVest as director of business development and marketing.

Still, IPG executives have pointed to a number of successes, such as UM winning the $700 million consolidation of GM's European media and planning business, as well as the $400 million L'Oreal media buying assignment. And Initiative did retain the $300 million AOL account last year. And on the personnel side, UM attracted Catherine Warburton-Scott, who resigned her post at Aegis Group's Carat USA in February to handle national broadcast at UM on client Sony's estimated $600 million media account.

That same month, Initiative attracted Alan Cohen--the former marketing czar at ABC and NBC who helped define network TV branding and cross-promotional marketing deals--to lead a new unit called "Innovations" to develop branded entertainment opportunities for the agency's clients.

As for Rosenthal, media veterans gave him high marks as an innovative executive who can deal effectively with marketers, has the ability to deal with far-flung and sometimes recalcitrant subsidiary units, and has a passion for consumer research. Still, when it comes to turning around IPG's condition--that's got to come from those at the top.

"I don't presume to be someone who should be telling IPG how to run their business; they're very smart people, and there's no reason to think that he can't manage IPG's media given the job he's done at MTV Networks. But there are some areas that are outside his control--such as IPG's financial condition--and some areas outside his curriculum vitae, which doesn't include managing media agencies," said Gene DeWitt, president of DeWitt Media Solutions. "But one has to assume that he'll have total support from both IPG and from the operating companies. And if he does get that, he should work out."

Rosenthal exited MTV Networks last July, after a decade as COO, when the Viacom cable unit passed him over to name Judy McGrath chairman and CEO despite the fact during his tenure, revenue and earnings from the company's operations more than tripled.

As for Rosenthal, he fairly dismissed the bad news that's hovered over the holding company and its agencies.

"There are very few companies you could go to where you have all the forces that can reshape the media landscape," he said in an interview. "And being charged with bringing those forces closer together is an exciting challenge. We have a huge responsibility to help clients invest major budgets in the media space and get the best return on their investments, and ultimately be their supreme navigator for anything and everything that is coming down the pike. It's a responsibility I take very seriously, and one that intrigues me."

An IPG insider noted that there are hopes that Rosenthal will inspire the various media shops, and bring some focus back to the operation from the holding company.

"There was a point three years ago when IPG was early to the game with Magna and the idea of aggregated negotiation," said one IPG insider. "Then other things happened that made the company take its eye off the ball. The mere fact that the release says that all of our media units report to Mark and that Mark is working directly with [IPG CEO Michael] Roth."

As for what he brings to the table from his experience on the media sell side, Rosenthal said the common point was research and being consumer-focused. In the meantime, in charting a course for the newly created post, he plans to meet with clients and organize a strategy for the media units, which he and IPG executives strenuously note will remain independent of each other.

"One of the things about Interpublic that is similar to MTV Networks is that this is a company that is driven by creativity as well as the need to understand consumers," he said. "Right now, I want to get in here and I want to walk around, meet everybody, get the sense of what they do, what they'd like to do--and then talk to our clients and get a sense of where we are superb and where we can improve what we do. A lot of it is going to involve me listening."