Mach9, the newly-launched agency from two former Philip Morris execs, has ambitious growth plans. But in the competitive talent market, can it convince the next generation of talent to work exclusively on booze, tobacco and gambling clients?
Jaime Suarez and Albert Moufarrij launched Mach9 earlier this year. Both are former Philip Morris International (PMI) executives; Suarez spent 13 years at the tobacco giant managing everything from its sales and marketing strategy to digital operations, while Moufarrij spent six years in various marketing roles. But a common problem they faced during their tenure was the time and energy it took to forge partnerships with ad shops that truly understood digital marketing in a highly-regulated environment. So they decided to make the leap from client to agency side.
“It’s like learning a new language,” says Moufarrij or working with restricted brands. “The agencies did not understand the different stakeholders present in these [highly-regulated] industries. The government, the anti and advocates; so many stakeholders that need to speak the same language. One issue we had was how long it took to onboard [ad agencies].”
The other issue they faced at PMI was simply that the technology most media and digital agencies used to ensure they were targeting the right people online and not, for example, minors, was not up to scratch.
“The solutions that were available at that moment were not adapted for highly-regulated industries. If you wanted to run a paid media campaign in digital channels, there were no [single-agency] solutions to ensure that the campaign would reach only the intended audience," adds Suarez. "There were no tech solutions to give a level of comfort to a highly-regulated company that the campaign would only be exposed to the right audience.”
Of course, tech platforms such as Facebook, Instagram and Twitter have sign-up processes asking people to confirm their age. But people lie. So, to “go the extra mile”, Moufarrij and Suarez developed a work around at PMI that allowed them to predict people’s ages based on their online behavior, rather than simply rely on native filters.
“These solutions are highly valuable, not just for [tobacco brands] but others in regulated industries,” Suarez explains.
They have now replicated these age-gating tech solutions developed at their ex-employer and are packaging them up for Mach9 clients across SEO, paid media and social. The pitch to brands is that Mach9 will help sell their products online "in a way that meets all the regulatory requirements and at the same time effectively engaging with their audiences."
The founders decline to name who they are working with, but say its roster covers the tobacco, pharma, gambling, alcohol and cannabis sectors with many brands appearing in the Fortune500 list.
“We saw an opportunity to combine understanding the challenges and the rigid standards highly-regulated brands have to meet in a one-stop shop," says Moufarrij.
And they are ambitious in projections of what this company will achieve. They set up offices on New York’s Madison Avenue and currently have in the realm of 50 employees, many of whom are former PMI colleagues, including Kathryn Parsons – PMI’s global head of digital marketing, now Mach9’s chief digital officer – and Sergi Garcia Calaf, who led PMI’s web and user experience division but left to become the agency’s head of client services.
They are hiring across the board, trying to pull in as many people specializing in digital marketing, SEO, CRM, web and experience, data and analytics as they can.
It’s hard for any agency right now to find that caliber of talent. But arguably it's even harder for Mach9 to woo the best and brightest, in an industry currently obsessed with ‘brand purpose’ and doing good in the world, to work exclusively with brands to sell more cigarettes and alcohol.
We’ve already seen the challenges traditional advertising agencies have faced by working with controversial clients. In 2019, the New York division of ad goliath Ogilvy and Mather faced a staff revolt over unwillingness to walk away from the $12m US Department of Customs and Border Protection (CBP) account. Other agencies have introduced policies rejecting certain clients, including AMV BBDO, which has declined to work for any tobacco company, while Interpublic Group has said it wouldn’t work for the National Rifle Association.
David Bernard, chief executive of recruitment firm AssessFirst, says as Gen Z - a more socially engaged and politically active age group than previous generations – comes into the workforce he is beginning to see talent put morals and ethics high on their agenda when looking for the right role.
"Companies involved with tobacco, gambling and cannabis must place greater emphasis in recruiting through personality-led skills, rather than via qualifications and experience," he adds. "This way, employers can locate candidates that understand - and are receptive to - the industry they work in, and understand the consumer-base which they pursue."
At most agencies there’s a quid-pro-quo staff buy into. For every big tobacco client that pays the bills, there might be a Patagonia, TomToms or Lush to work on.
Suarez assured that it's not "yet" faced any challenges in attracting prospective employees to the company with only a roster of highly regulated brands.
“We’re facing a problem with the labor market being very hot. Especially for detailed jobs in the tech space. With Covid, we experienced a lot of changes in the marketplace, including the rise of last mile delivery and a big shift in consumer behavior," he goes on. "There’s an appetite for companies to accelerate digital transformations and there’s a lot of demand for this profile [of digital-savvy recruits]. This is the challenge we’re facing. More than any other.”
It’s a burgeoning market, with the slow legalization of cannabis across the US, the increasing number of states giving sports betting the green light and billions being invested by PMI and its peers into e-cigarettes.
Against this backdrop, within the next six months, Mach9 predicts it will have doubled in size if it can win over prospective staff. For purpose-hooked ad shops unable, or unwilling, to work with highly-regulated clients, they may find this new media agency will hoover up business they could come to miss.