If you ask an average Joe about the similarities between a person serving coffee at Barista and an advertising creative, you will probably get a long list of dissimilarities. But try asking Per Pederson, Founder and Creative, By the Network, and he will tell you that in today’s world, they are almost the same.
Pederson, who is ex-Creative Chairman at Grey, has a whole different voice at the Cannes Lions 2022, one that is freedom loving, and passionately creative. The dispassionate involvements of tech companies, and consultancy firms has not gone down well with him, as he says that his current organization, By the Network, is not owned by a holding company and runs on creativity, above all else.
You have been attending Cannes Lions for over 20 years now. Over the years what has changed here that you disapprove of?
Cannes 2022 is too much about the tech companies, they have invaded the festival. We will be dependent on what they are doing but the degree is now ridiculous. If you go outside to the Palais, you will see how they have wrapped up the walls with really ugly communication from tech companies. To me it is an insult to creativity that at the Mecca of Creativity you have the worst communication. Cannes deserves better. The organisers need to either get such companies to improve their standards or simply say no.
What do you think is creativity in the modern context? How has it evolved?
All good creatives are good at killing their darlings. You let go of the stuff that you, at some point really loved, but then we are in an industry that loves their darlings and are not killing them. Today you have big organizations, more than a thousand people in an agency run by a corporation. All of this made sense 20 years ago (or maybe it never made sense), but as a result a lot of people feel alienated, especially the young. Today they get into this industry thinking it’s a creative organization. But in reality, they walk into a grinder, it's like working at Starbucks where you produce the same coffee every day. So eventually it becomes a job, but creativity is not a job, it will never be a job.
At the fag end of the pandemic, we saw a lot of people, after a year of work from home, realizing that they didn't want to go back. Simply because there are other ways of doing things. Technology aided Zoom meetings, virtual networks, and you could team up on a project basis. Why would anybody go back to a factory and start serving Starbucks coffee again?
What, according to you, would be the biggest threat to advertising? You've mentioned two things – consultancies or the tech companies and holding companies. So, which amongst the two would be the bigger evil?
I think if you are a tech company, you will always be a tech company, if you are a consultancy, you will always be a consultancy. Even after you end up buying the most creative agency in the world, it doesn't change the fact that you are a consultancy. While that sort of coalition can be interesting, but at the heart of it, the owner always has the last word, and they want your creativity to support their consultancy product. So you're always going to play the second fiddle in the orchestra, if you can manage that conflict of culture, which I think is pretty evident, whether you are consultancy owned, holding company owned, or tech owned. If you can manage that, some people can really be good at it. But I think a lot of creatives don't want to manage that, they want something cleaner, something more pure.
There is a pure model, and then there's this mixed-up model of consultancy-led creative agencies, or holding companies. As far as the clients are concerned, would they be happier in a model where they are being serviced by a consultancy and they have a creative engine, which is supporting them? Would that be an argument that it's working for them?
There's nothing that these companies have done that doesn't make sense from a logical point of view, but you are dealing with something very illogical, which is creativity and creative people. Creative people decide on their own, they are more related to artists than to factory workers. But as I said, some can manage that for years, and I personally did so for many years. But you get to a point where it just feels empty and hollow and wrong, and you want to do something on your own terms. That's what we are seeing now.
How is the structure at By the Network different? What is your revenue model like?
The biggest difference is that this network is owned 100% by the agencies. So, we don't have a holding company that owns anything. When you are in the network, you are an owner, you're a partner, so it's a collaboration, a co-op business model. It's a little bit more democratic, so you may need an extra meeting about certain things, because a lot of people have to agree, and no one dictates. There is no boss talking about revenues, we don't look at their numbers. The agencies pay a subscription each year to be part of the network, and this subscription is small so that we could have agencies from all parts of the world, including emerging third world countries. I also wanted to be able to take on start-ups, like agencies, where two of the best creatives in the world get together and open their own agency and they don't have money. We would still want to work with those guys. I run a network with 30 agencies right now, with maybe about a thousand people, so we are getting bigger. But the minute we are too big, we are back to the old structure.
What is the parameter of getting an agency on board, and also, how do you define their success if it's not through numbers?
We are owned by the agencies, who pay a subscription. When we win a business, a certain amount of money goes to the network. Like 10 per cent of incremental revenue, the rest is split by the agencies that are working on it. So, so let's say 90 per cent of all income stays in the agency. That is how simple it is. If you work hard to win a piece of business, you keep the business. A very good example is Atom, who played a big role in getting our first client, Snapchat. We allowed a completely new agency in India to pitch against big agencies in the world, win it, and keep the business.
Who are your biggest clients at this point?
The biggest client we have at the moment at least in the US is Prime Video, and the deal they have with NFL for the Thursday night football in North America.
What would you say are your biggest challenges at this point?
The challenge here was launching during a pandemic, but it was great for us because it meant everybody was open minded. However, we haven't really had a chance to get launched by the network. This is the first time we are at a festival, our first Cannes Lions outing. So everything that we have built in the past year and a half was basically with LinkedIn. I think the challenge is if you are small and you don't have a big budget, you can't buy media space. How do you get a voice? How do you get on the mindset of the big clients? I know when clients hear about us, they're extremely interested, but most of them have never heard about us.