The Stagwell Group
- Mark Penn's Stagwell aims to challenge ad-agency giants like WPP and Publicis.
- The former pollster sees a significant opportunity for AI to shake up the ad industry.
- He said brands often botch supporting social issues because they lack a balanced worldview.
- This story is part of "What's Next?," a series where we ask CEOs of prominent companies across industries about how rapidly evolving trends influence their approach to leadership.
Mark Penn's background working on political campaigns and as a pollster for the likes of Bill and Hillary Clinton makes him somewhat of an outsider within the ad industry. He's now the chairman and CEO of Stagwell — an advertising and public-relations group that aims to challenge ad-agency giants like WPP, Publicis, and Omnicom.
Stagwell made $2.7 billion in 2022 from its agencies, including Code and Theory, KWT Global, and Anomaly. Insider spoke with Penn about why he's betting on artificial intelligence, buying experiential marketing shops, and how brands should handle thorny social issues.
This interview has been edited and condensed for clarity.
Do you think AI will eliminate creative jobs like copywriters or art directors?
I think it will make those processes more efficient. When things get more efficient, several things can happen. One is you can have fewer of them. The other is that you can have more of them because it's fundamentally cheaper. A lot of people who couldn't afford a copywriter might be able to afford a copywriter.
Big brands like Bud Light and Target have been in the news after backlash for supporting social issues. How should brands handle supporting social issues?
I think the problem often is that companies have great communications and marketing teams but they don't have teams that are skilled on issues. And if they do, they often have someone from one party — they don't have a team of both parties.
We've put together people who have been involved in politics from the Democrat and Republican sides with polling and financial communications capabilities.
There is no cookie-cutter answer to these questions. It depends on your mix of stakeholders, your values as a company, and what you do and do not stand for. People hate Johnny-come-latelys who suddenly decide to virtue signal on issues — there is a lot of potential exposure for people who do that. The biggest problem is that [companies] don't have a balanced group of professionals.
Part of the problem is that companies never like to spend on this until there's a crisis.
You recently bought the experiential design studio Tinsel for an undisclosed amount. What other acquisitions are you interested in?
The topic du jour is AI. There's obviously a lot of clients who want to know how they incorporate AI in their marketing, and I think this will generate a lot of work for digital-transformation teams.
We're building a suite of tech products. We have PRophet — we'll help you write news releases, see who's going to be interested in it, write the pitches, and send the pitches out [using AI].
The very first thing that you have to be cognizant of is that we're used to people interacting with links that they click on — generative AI changes the whole way that one interacts with technology and how one is marketed to. We're all used to clicking on links — now we can get a response and we can then have follow-up interactions.
There are obvious production enhancements and storyboard making, but the biggest impact [of AI] is once you begin to incorporate it into the work itself. I don't think people are spending enough time or thinking about that as the fundamental change.