How do you juggle hundreds of jobs for your clients every month, while keeping costs down? This was the challenge facing Auckland-based Metromedia, which devised an innovative software-based supply chain management system, widely credited with fuelling the growth of the six-year-old business.
Metromedia is now one of Auckland's leading communications agencies, employing some 30 people and offering services as diverse as PR, design, advertising, web development, photography and sponsorship management.
Sitting in their Ponsonby Road office, Paul Manning with business partner Ant Hassett, reveal the secret of their company's success.
"The only philosophy of our business is client-centric - how that applies to technology is that we look to be leaders of the industry and continually do things smarter," says Manning.
Best mates since junior high school, the pair work together in developing technology solutions that set the young agency apart from the others. Manning focuses on client leadership, account direction and services, Hassett on technology and finance.
The supply chain system manages a client's business from brief to end product. It helped Metromedia attract the attention of Ernst & Young, which named Manning as its 2005 Entrepreneur of the Year. "Central to Metromedia's success is its robust structure with management of all core communications services occurring within the agency," says the consulting firm. "This allows it to offer unparalleled consistency, greater brand intelligence and significant savings through consolidation, whilst enabling the team to share knowledge across projects simultaneously."
The system was custom-made three to four years ago by Metromedia's own team of developers. It was built on top of a US system called Clients Profits as no similar broad-based ad agency software existed in New Zealand at the time.
"There's work to do in managing processes. We don't just hand a job to the printers and forget about it," Manning explains.
"As soon as a job request comes into the agency, it gets a job ticket. That stays with the job throughout its life. Cost estimates get prepared and entered within the system and if we don't get the job, that's the end of it.
"If the job is approved, as the job goes through its life, everything is entered into the software. Maybe the project requires design work, some media to be purchased or brochures made. As the job moves into the studios, the studio manager gets a report. When work starts, a stopwatch pops up to record time spent on the account. Insertion orders, print orders, purchase orders, all costs are recorded, it keeps flowing through," says Manning.
A job tracker feature also means fewer mistakes as the many staff that can enter the system will soon spot anything that seems untoward.
Customers can also easily receive 'work in progress' reports and Metromedia can easily assess how much time and effort is being spent on a job to see whether it is cost-effective.
Auckland City Council submits 1200 to 1500 projects a year to Metromedia and the system helps the agency produce quarterly presentations for the council, helping council directors see where their advertising spend is going.
"Then they can rationalise it against other means of information. As an agency, we end up knowing more about a client's business than they do. The system sets us apart as being more management savvy," says Manning.
Hassett says the software brought some four to five disparate systems together, taking Metromedia away from using MYOB for accounts and Excel for other data.
"We wrote a brief for a software developer, then we went to the market looking for an off-the-shelf product. That's why we came up with this US-based system. Its downfall was that it was not suited to New Zealand and it needed some changes but the functional structure was okay. It did not involve reinventing the wheel. We could have fallen into the trap of paying for it to be developed," he continues.
Hassett says the system has a few bugs but has worked well. It is also scalable, coping with Metromedia growing from six staff to 30 and revenue increasing annually from $1 million to $6 million.
"It's given our management team one centralised place to manage the information. I cannot imagine running the business without it. We manage a couple of hundred projects a month. That's a lot for a media agency," says Manning.
A significant share of the pie
In May 2005, Metromedia launched its internally-developed extranet online media database.
Digital images taken over five years are stored and clients, using passwords, are able to retrieve the information themselves. Thus, if Auckland City Council needs to find a picture of the Mission Bay fountain, it can find the picture itself, and not be billed by Metromedia.
"They can pull down PDFs and not be charged for little admin things. Part of the business case is we get rid of jobs we don't want to do, while making information more accessible," Manning continues.
The extranet is also linked to Metromedia's logistics facility in Grey Lynn which lets customers see what promotional materials are available. For BMW, Metromedia has developed a 'centre markets portal' so BMW dealerships can obtain various material, such as flagpoles, and see who is using it.
For Auckland City Council, the extranet's search engine lets the council check the last time something was mentioned in the council's weekly newsletter, for example.
"Clients can interact with the agency without picking up the phone or sending an email. They can look at the log and see who has done what," says Hassett.
The extranet claims to be the most significant of its kind in New Zealand and has helped Metromedia win corporate accounts like Fuji-Xerox and BMW.
Hassett says customers like the extra customisation that also makes them feel special. The system also offers them things that cannot be published freely on the internet. With the Java-based extranet now bedded in, Hassett says it will now be upgraded using HTML to make it look like a normal website.
Looking at the advertising industry in general, Metromedia reports an explosion in email newsletters. "The power of internet advertising has gone through the roof over the past two to three years and many of our clients have a website. We are looking to develop a system that makes the creation of these newsletters very simple, a proprietary system that we can sell on content management growth."
"I don't see online communications necessarily taking over from traditional media in the near future, but online has taken a significant share of the pie," Manning continues.
Indeed, it is perhaps more traditional business nous that has helped Whenuapai born-and-bred Manning build up his business and now drive around in a BMW M3.
Getting the breaks
He had wanted to work in tourism, studying the subject for a year at Unitec, before joining Fullers Group.
One day, nine years ago, while clipping tickets on a Fullers ferry, he passed on some comments about the business to someone who turned out to be its marketing director. The latter gave him his first break by moving him to the marketing section.
Two years later, with new-found skills in print and radio advertising, he moved on to media sales for INL's (now Fairfax) Suburban Newspapers, helping some titles achieve budget for the first time in years.
Manning soon learnt which type of ads worked and did not work and after a short spell at another publishing firm, he decided to launch Metromedia with Hassett, then a freelance Mac operator.
They would take existing newspaper ads and show potential clients how they would improve the ads - a method that quickly helped grow the start-up bring in business.
While technology helped the company gain much business through a high volume, low margins philosophy, with costs reportedly 30 per cent less than rivals, Manning believes Metromedia has now come into its own.
The Ernst & Young award and the BMW account put Metromedia into the limelight, he says, and led to other big account wins, such as Fuji Xerox and Auckland City Parking. The company is also launching its own sponsorship and events division.
"It was dear for us to have a premium vehicle brand. They could have gone for any agency but they went with us because we offered value for money. Even premium brands are aware of parallel consistency. Our agency isn't just for big, complex corporates, but also premium brands seeking something surgically precise," concludes Manning.
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