With UTA, Michael Kassan skirmish, why do Hollywood and Madison Avenue make for strange bedfellows?

The allure of Hollywood paired with the savvy of advertising — is it a match made in business heaven or a recipe for disaster? Recent events, like the clash between talent agency UTA and marketing consultancy MediaLink’s founder and CEO Michael Kassan, suggest the latter.

These unions are notorious for unraveling, though they typically do so behind closed doors. UTA and Kassan have definitely shattered that mold with their public dispute which played out in the trade pubs after it was revealed both companies are locked in a legal dispute.

Yet, in many other aspects, this partnership is just following a well-trodden path in yet another collision between Hollywood glitz and Madison Avenue pragmatism, inevitably stumbling into an unavoidable breakup.

“It’s like a body rejecting the organ — Michael [Kassan]’s model is not a fit for UTA’s more institutional model,” said Shannon Pruitt, a longtime content executive in marketing and current global chief content and partnership innovation officer at Stagwell’s Brand Performance Network. “The nuance of this particular situation is that you introduced an entirely different business model into what is a Hollywood institution and [talent] agency model that didn’t necessarily fit.”

These partnerships have worked before — even if there are few exceptions. Naysayers may cite Maximum Effort Productions, Ryan Reynolds’ successful marketing agency, as evidence of synergy between the two realms.

The two worlds seemed to first collide in a meaningful way when Michael Ovitz, co-founder of CAA, snagged the Coca-Cola ad account from McCann Erickson in 1991. There was hope at the time that it would spark a trend. Instead, it’s been more of a slow drip. For every UTA venturing into advertising through acquisitions like that of MediaLink in 2021, many others have found scaling in this arena a daunting challenge.

Take a slew of efforts in the early aughts and 2010s – think Funny or Die’s advertising work or Will Arnett and Jason Bateman’s DumbDumb Productions or Ashton Kutcher’s Mr. Social – from Hollywood stars that have seemingly fizzled out. Hollywood stars may be open to working with advertising but it’s rare for that to continue for long, according to industry insiders and agency execs. 

The clash of egos and cultures is largely responsible for the repeated pattern of breakups between the Madison Avenue and Hollywood partnerships, according to industry insiders and agency execs, who say that the UTA-Kassan standoff is unique, but not entirely surprising. Both advertising and entertainment are ego-driven, relationship businesses even if the finer details of how deals within each realm shake out can be different, leading to tension. It’s a bit like watching Sauron fight Lord Voldemort.

“When you put oil and vinegar together they don’t mix — they’re both used to running their own show and having autonomy,” said Allen Adamson, brand consultant and co-founder of MetaForce. “When [Hollywood and advertising execs are] in their own bubbles, they can do what they want. But then you try to put these two bubbles together and then you have huge egos on both sides of the table saying, ‘I know how to run a business,’ — it’s hard to teach old dogs new tricks.”

The marriage of Hollywood and Madison Avenue makes sense on paper, especially now as advertisers want more than ever to immerse their brands in culture amid an ever fragmented advertising landscape. It’s logical for advertisers looking to be part of culture to make deeper inroads with those making said culture, making it easy for Hollywood and Madison Avenue to pitch a marriage on their ability to work together to help brands become more culturally relevant. And marketers are open to bigger investments in Hollywood now; LVMH’s recent announcement of its venture, 22 Montaigne Entertainment, is one recent example of this.

However, Hollywood talent agencies are in a volume and velocity business that works at a much faster pace than most advertisers do, making the marriage difficult. When one side of the business is looking to ink deal after deal aiming to get the next commission and another is hand-holding risk-averse marketers — many of whom are already dealing with more demands, tighter budgets and CFOs holding the purse strings tight — that can make for a rocky partnership. Hollywood seems to be looking for more consistency from Madison Avenue and that isn’t easy to deliver, especially now.

Despite a rocky precedent, industry insiders and agency execs believe both Hollywood and Madison Avenue businesses will continue to pursue closer ties. It may be a matter of the talent being a drive force rather than Madison Avenue or Hollywood execs, as has been the case with Ryan Reynolds Maximum Effort Productions, Kendrick Lamar’s pgLang or Ben Affleck’s Artists Equity.

“It’s not as if anyone’s reinventing the wheel here — if anything, the lines are blurring between entertainment and advertising,” said Ken Robinson, partner at search consultancy Ark Advisors, who noted that the Barbie movie and the surge of interest in advertisers working more closely with the entertainment industry is an example of that.

But it can also be “muddy” to work with ad agencies run by Hollywood stars, noted Robinson, who said that celebrity-founded shops have wanted to get in on pitches run by search consultancies.  “You hire one of these advertising agencies and, ‘Boy, I wonder who they’re gonna recommend as a spokesperson, who directs, you know?’” 

While some marketers may be interested in the potential to work with or meet a celebrity through these efforts, the cream of the crop when it comes to celeb-run agencies are few and far between. 

“I think they will always sleep together but never get married,” said Andrew Essex, senior managing partner at TCS Interactive and former CEO of Droga5, when asked about why Hollywood and Madison Avenue are strange bedfellows. 

Jonathan Miller, CEO of Integrated Media Co., which invests in digital media, noted that the Hollywood agency model and the Madison Avenue agency model are heading in divergent directions. “The marketing services side requires teams on everything — if you’re working on Coca Cola, it’s a team,” he said. “The Hollywood agency world is a much more siloed, solo-ish kind of world. They’re not used to working in teams and that may be reflective here.”

Miller also noted how marketing is so data-driven these days, where the Hollywood agency still operates very much on relationships — be it cajoling or intimidating.

Questions remain when it comes to what happens next for UTA and MediaLink. What will this mean for Cannes Lions where MediaLink is central to what the culture of the festival has been? During the run-up between SXSW and Cannes Lions in June, Kassan is often on the phone, managing relationships to finalize details of the festival, according to someone familiar with the Cannes planning process. What that looks like without him is yet to be seen.

Despite this uncertainty, UTA plans for MediaLink to be at the Cannes Lions festival. “There is a strong executive leadership team in place at MediaLink that continues to carry the business forward,” said a spokesperson for UTA, without putting a name forward as to who will be filing Kassan’s shoes.

Other industry insiders told Digiday that they could see Kassan returning to Ascential and taking over Cannes Lions personally — he’s often said that he would one day love to own the event. Whether that comes to pass remains to be seen.

“Michael started MediaLink 17 years ago and it has been his life ever since,” said Nick Shapiro, Kassan’s spokesperson. “He never would have permitted the sale to UTA to go through had he known [CEO] Jeremey Zimmer would break the deal. Michael invented this industry and whatever he does next, it will be successful, and with a martini in his hand.”

And that frustration spills over into Kassan’s lawsuit against his former employer. He’s alleging UTA sweet-talked him into the sale, only to turn around and renege on promises about his role and budget.

UTA begs to differ, arguing that Kassan allegedly committed fraud using company funds for personal expenses and that they had grounds to terminate him on March 7.

“In order to secure UTA’s investment, Kassan presented himself as a trustworthy businessman who had operated with the stringent controls and regulations of a publicly traded company. That turned out not to be the case,” said a spokesperson for UTA. 

The battle will play out in court. Not even three years later, UTA’s $125 million acquisition of MediaLink is called into question. Should UTA have bought it in the first place? 

“I think UTA made a bad decision — they failed to let Michael Kassan be Michael Kassan,” said Lou Paskalis, CEO and founder of AJL Advisory. “And that diminished their asset. When push comes to shove, Michael knows how to win a scrap.”

https://digiday.com/?p=538072

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