—CEO tells Campaign he is optimistic after reporting 4.5% growth in Q3, ahead of some key rivals—
By Gideon Spanier
Yannick Bolloré has said Havas was happy to pitch for and win Shell’s global media account, despite controversy about working with fossil-fuel clients, because “we believe the most effective change comes from within.”
Some groups are pushing for a review of Havas’ B Corp certification, which is linked to environmental, social and governance standards, but Bolloré played that down in an interview with Campaign following the agency group’s Q3 results.
The global CEO of Havas said he had previously spoken with B Lab, the organizers of the B Corp programme, about working with clients that are perceived as controversial across a range of sectors, including fossil fuels, and “as long as we are working on making things better, B Corp agrees that we can partner with those types of industries.”
Bolloré also quoted the French philosopher Voltaire as he defended the right of environmental campaigners such as Extinction Rebellion to protest about Shell, after several incidents at Havas’ offices, even though he does not agree with them.
He added he was “quite optimistic” about the business outlook as Havas, the smallest of the big six agency groups, after it reported 4.5% organic growth in Q3, which he claimed was among the “best in class.”
Havas bought a majority stake in London agency Uncommon Creative Studio in July and Bolloré said he was seeing a growing demand from clients for what he called “super-creativity” and awarded creative work, after a decade when many advertisers have cut investment.
This is an edited transcript of the interview.
How would you describe your Q3 results?
Havas’ results are very strong, up 4.5% organic, after a very strong Q2, up 6.3%. So we are very satisfied, especially given the macro-economic environment, which is not great, and when I look at the results of our peers, we are best in class.
Publicis is slightly higher than us at 5.3%, Omnicom is below [at 3.3%]. I guess IPG and WPP will be below [IPG subsequently reported a 0.4% decline, and WPP reports on Oct. 26]. So, given the circumstances, we can be super-satisfied with these results. We have growth in every region in this quarter—we have a spectacular LatAm—and the dynamic of the group is great in terms of of client satisfaction. Even new business is good.
I feel confident for the end of this year. Being transparent, I was not that confident [at the start of 2023]. If you had told me in January that we would have reached more than 4% accumulated organic growth after the first nine months, I would have been very positively surprised.
You sound quite optimistic in this situation—leaving aside recent events in the Middle East since the start of Q4.
I am quite optimistic because I know the trend for the year-end, and we have contracts with clients [in place]. I think the end of the year will be strong, and we are already starting budgeting for next year. The experts are saying that the advertising investments of clients might slow down, but still we will experience growth. Let’s say this year, it would be up between 4% to 5%. Next year might be up 2%.
What is sure is that, if we have some headwinds next year, I don’t think the communication budget from clients will decline significantly. Covid has proven over the past two or three years that, even in times of headwinds, companies that continue to invest in advertising out-perform their peers. So I don’t see any major drop in communication [budgets] next year. I think it’s going to be another year of growth [in 2024]. Maybe not as spectacular [as this year], but I would have said the same a year ago about 2023.
So I feel cautiously optimistic—and cautiously because of geo-political reasons [such as the Israel-Hamas war].
You mention new business. Would you pick out any highlights?
We won a very important client, Shell [for global media], a couple of weeks ago; we had a lot of talk in the press and internally [about that decision]. We have also had significant wins locally. Recently in France, we won KFC for media—it was a [Havas] Village win. We used to handle the creative assignment, and now we have the media [as well, as part of an integrated offer].
We just retained Lactalis for media in Europe and Latin America, we won a new assignment from Reckitt, which is one of our main clients, and we are starting to implement Danone [for global creative], which we won a couple of months ago.
Some of your peers [notably Dentsu] don’t have that many global assignments. Is that a big ambition for you to win more global clients to build out Havas?
It’s an interesting question. When I started at Havas [as CEO] 10 years ago, it was very local and clients were working with different agencies. We saw the first global media pitches starting. Then, three or four years after, it has been spectacular in health with global consolidation and holding company pitches for pharma clients.
And it’s also important in creative to have some global assignments such as Danone or Reckitt, because it helps us to structure the network—so people from different countries can work on the same accounts. It’s important that our agencies share not only best practices but clients. If you look at Reckitt, it’s global clients that are producing global campaigns, but the ideas can come from anywhere, like Vanish’s “Me, my autism and I” was produced by Havas London.
Tell us about the decision to pitch for Shell and take the business, and the fact that there have been protests, even in your office.
Peter Mears, the CEO of Havas Media Network, brought the subject up at our executive committee when we were invited to pitch, and we had a discussion because we know there is a sensitivity [about energy clients].
At Havas, we have a clear mission to make a meaningful difference for brands, businesses and people, and the question is not really about Shell. It’s more about an industry like fossil fuels or all of the industries that are considered controversial—it could be car manufacturers, airline companies, a bit of pharmaceuticals, even pet food can be perceived as controversial.
What we decided is to help brands engage in a meaningful transition journey. So as long as brands are engaged in trying to become more meaningful—to make a meaningful difference to the world—we believe we will make more effective impact from within. We believe the most effective change comes from within.
So we decided to respond to the [Shell] pitch but at the same time to be true to ourselves, to let them know that at Havas we are on a meaningful journey ourselves. And we have to say we won’t participate in any greenwashing whatsoever, and we will accompany them and help achieve their transition.
The vast majority of the investment that we will be managing [for Shell] is for the building of EV [electric vehicle] infrastructures and charging stations.
I would say there are two lessons from the fact that we won: first, congratulations to the team, because all of the industry has been pitching and there was fierce competition. And second, maybe in choosing Havas, [it shows] they are serious in their transition journey.
And when it comes to the protests, allow me to quote the French philosopher Voltaire, who said: I strongly disagree with you, but I will fight to the death to make sure you can continue to express your opinion.
Even if you anticipated the protests, there is some suggestion about whether Havas’ B Corp status could come under review. Have you been surprised by some of the negative reaction about Shell?
First, on B Corp, I talked to the inspector for the certification myself, and we discussed the fact that Havas was working with car manufacturers, airline companies, and all those industries that are perceived as being controversial. And as long as we are working on making things better, B Corp agrees that we can partner with those types of industries.
We will maintain all of our commitments that we have made in the reduction in greenhouse gas emissions and certainly hope to keep all our certifications—B Corp and EcoVadis, and ISO 14001.
What’s important is the Havas numbers [in the Vivendi annual report] show we have reduced our greenhouse gas emissions of CO2 by 43% in five years.
Vivendi has made environmental, social and governance issues a growing part of compensation for senior executives. ESG used to be 5% of variable compensation in 2019, and has now risen to 15%. Why does ESG matter?
I believe ESG is not just a buzzword. This is a revolution that is here to stay. I believe that companies which miss the ESG revolution will be like a company in the 1980s that would have missed PCs, or a company in the year 2000 that would have missed digital.
If you look at the reality of the world today, consumers really expect companies to make the world a better place. Whether you look at it from a talent standpoint, a client standpoint, or from as investor standpoint, it’s very important to have some proof points on ESG. When we started, it was more about talking about nice initiatives and charity work. Now there is a big paradigm change, where we need to have a much more scientific-based approach where we can prove what we are doing in terms of positive impact.
You bought a majority stake in Uncommon Creative Studio in July but we have seen across the industry that creative agencies have been growing more slowly than other disciplines such as media or healthcare. What trend do you see, and is it changing?
There are two trends. First, the global spend from clients for creating campaigns has been decreasing for the past 10 years. They are spending less money. They’re producing fewer campaigns and less content. They are trying to automate everything, to do one global campaign, with local adaptations or transcreation.
The [other] trend I have been witnessing for the past couple of years is a wish from clients to again become super-creative. After each Cannes Lions for the past 10 years, we have been doing feedback to clients, showing them the best campaigns, the best creative that has won the gold Lions and the Grands Prix. And I see more and more interest from clients in those campaigns.
Ten years ago, I am not even sure they were looking at what we were sending and they were clapping politely—they did’t really care about getting a Lion. Today, I would say clients really understand that an awarded campaign that is more creative than an average campaign will become a business asset, and will transform their growth trajectory. So I believe there is a move back to highly creative and well-thought, bold campaigns.
Is there a sense that Uncommon could be a unit that will work on super-creativity? You consolidated a lot of your creative within the Havas Creative network many years ago, before the pandemic—long before WPP merged Wunderman Thompson and VMLY&R, for example. Is it right to think that most of your creative is done by Havas Creative?
No, because if you look at France, we have the same situation [as with Uncommon in London]. We have a big Havas Paris main [creative] agency and we also have BETC, which is partnering with Havas Creative network. Look at Danone—it’s been led by BETC in Paris, with the help of all of the Havas Creative network. So next time Uncommon goes to pitch for a global client, they will lead it from London with the help of all the Havas Creative Network.
This article originally appeared at Campaign UK.