Reciprocal Brands: Interpublic Trades UM's Telesco To Orion, Cites Barter Expansion

Orion's Tom Telesco

As part of a major expansion of its corporate media trading unit, Interpublic is trading one of its top media executives, Universal McCann Managing Director Tom Telesco, to its Orion Trading unit. Telesco, an 18-year veteran of the UM, is joining Orion as president of its North American operations at a time when the barter media unit is expanding globally, and beefing up its organization to handle demand from marketers seeking to convert unsold merchandise and services for media time and space.

In an internal memo explaining the moves to Interpublic's Mediabrands organization, Orion worldwide chief Brian McMahon noted that Orion's revenues have grown "99.1%" over the past three years, as a variety of factors have accelerated demand for barter media deals.

In an interview with MediaDailyNews, McMahon explained that demand for barter media deals has been driven by two primary factors: the global economic recession, which has contributed to higher-than-usual capacities of unsold inventory that could be converted into media credits as part of barter media deals; and an expanding awareness of the underlying value barter can play in the media mix, especially in overseas markets.



McMahon said the U.S. has the longest history of barter media deals, and is the most mature and sophisticated market, but that Western Europe, Asia and Australia are all expanding rapidly.

Those factors, coupled with a shakeout over the years of major independent barter media services, has led other blue chip agency holding companies - most notably WPP's GroupM and Havas - to launch barter media divisions. But McMahon says most of the other majors are primarily U.S. focused, and that much of Orion's expansion is international.

He declined to disclose revenues, but said that Orion now derives about 30% of its revenues outside the U.S. and expects that to climb to 40% over the next year or two.

Orion currently has a workforce of 300 people, which McMahon said breaks down closely to the revenue break, and that it currently operates in 13 countries with a managing director in each one, Telesco, being the 13th addition, representing the U.S. and North America.

Telesco said he has worked on a number of barter media deals through his conventional media services role at UM over the years, and was attracted to the opportunity at Orion, because believes more marketers will begin using it over time.

"What I find interesting about the barter business is there is a very clear value proposition that Orion provides to clients. It's quantifiable. It's geared toward the bottom line," he told MDN, adding, "The ability to help clients in a very clear and profound way is what attracted me."

Telesco said it was not deterred by the old reputation of the barter media industry, which was rife with stories of shoddy practices, and occasional fraud, but which has grown into one of the most sophisticated, and arguably most complex, parts of the media services industry.

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