Harold Mitchell: Emitch and their digital partners

In 30-years Mitchell and Partners has become the country’s largest media buying agency, but it is with emitch that Harold Mitchell looks ahead.

Mitchell and Partners has some 700 clients who turn over $900 million using traditional media including radio stations, newspapers, magazines and the various forms of advertising that have been in existence since media marketing began. But in 1999, Harold Mitchell saw a gap in a new medium that was ripe to be tapped. The burgeoning Internet would take advertisers into the digital world. “I started to see real opportunities in the emergence of the Internet and the digital world. So we separated our thinking from the mainstream company and formed a separate business called emitch, to concentrate on the development of advertising forms on the Internet. It was the same structure we had for the media buying company,” says Mitchell.

Thinking ahead

Mitchell has always been a forward thinker, a trait that has helped him become the go-to man for media comment in Australia, and has seen him build the most famous and long-standing of all the media buying companies. The divestment into online media was a natural progression, which Mitchell pioneered on the backbone of the existing business. “We established partly on the basis of the business we already had,” he states. “So we had strategists and planners and buyers, a small but active client base and standard business forms put to what was new media.”

It was a great start, but caught up in the excitement of the dot.com boom of 2000, emitch was valued much higher than was appropriate. “When we launched it suddenly had a value of 50 cents per share and some $90 million in value, so it quite correctly collapsed down to 2.5 cents per share, but underlying it was a very solid foundation of cash, so we had a very solid feet-on-the-ground, old fashioned approach to business in the new media world.”

There was no huge paradigm shift in the philosophy of how the business should be run. “We concentrated entirely on what we did, which was to use the Internet services and the digital world to sell products and services to customers. We didn’t get carried away with the fact that this was an entirely new way of business management.”

However Mitchell did, over a period of time, develop specialists and a specialist approach. This took time and patience, particularly in building up a client base, but he never lost sight of the fact that emitch would be successful if it made money for other people. And it would do this by concentrating on advertising. “In the case of the media company, you could get much of the content from newspapers and magazines, so we knew that the base to run one of these services would have to be advertising. We established our first advantage because of that. Now some six years later, where we see so many people coming into the market, we’ve been established.”

The vision to see that the market would move this way, and the understanding that it would still require basic business principles, has allowed emitch to stay one step ahead of the emerging competition. “We started emitch only a year or two after Google, well ahead of MySpace and YouTube, so we’ve been fortunate to see the effect of the move.”

Know the market

Mitchell is also a great proponent of isolating a target and he recognised early on that the Internet was the perfect way for advertisers to isolate individuals. “We knew that the world of the individual was developing at a really fast pace. The Internet is the perfect way to isolate the individual. We saw that as an enormous advantage, without ever, I have to say, seeing it grow as large as it has. It is possible that this is another revolution, not as large as the industrial revolution, but broadband and Internet can supply information, entertainment and commerce around the pathways that are truly international and economical.

For Mitchell there is also the small matter of newswires and media organisations all creating an online presence. Media has to diversify its interests to keep up with the changing trends and habits of their customers, subscribers and readers. More and more people are obtaining their news from Internet services. “It won’t spell the end of the big media companies,” says Mitchell, “because they will hold on for as long as they can to traditional forms, but they will ultimately move to establish themselves in new space. We have already seen that with News Limited.”

As the media organisations change with the times, so too does emitch. “You must be very active and alive to everything the Internet represents. Search is becoming bigger than we saw in the beginning and interactivity is a large part of it. Media forms such as MySpace are indicative of that, so we have adapted.”

Mitchell understands that the World Wide Web is not geographically confined and has thus set his sights on Asia, something the company as a whole has never done before. “Asia is now the most populace zone in the world and pretty soon, within ten years, will be the biggest economic zone in the world. Australia is well placed for that. Internet business is developed quickly here and we’ve got major Asian families as part of the investment base of our business. They’ve discovered us as much as we’ve discovered them.”

The family stone

Expansion is a high priority for Mitchell and he expects the next generation to push into the Asian countries, that includes his son and daughter (36 and 32 respectively), who will be prominent in the company’s next growth phase.

Family has been an important motivator. “I’ve seen many service industries established, sold and disappear. I have planned for that not to ever happen. There needs to be a sense of ownership. I’ve seen it as much as anything in the Asian families; how family can bring value to a business because of the solidarity and continuity. Our company is more than the one I started, it has a dozen arms which have emerged because of the new generation and that’s important.”

As the new generation push forward there is still a focus on basic business principles. The company will stay focused on the area it knows best – media. And the factors that drive Mitchell will remain the same as they did when he first started in business – he will not fail.

This edict, this fear of failure stems back to his childhood. “It isn’t so much about wanting to win, it’s that you don’t want to be beaten and that’s driven me always.” Mitchell says that while it’s impossible to be number one at everything, it is possible to be successful at everything you do. “I’ve learnt to be very patient over time and to realise that objectives will be met if you set them.”

People are also an important part of Mitchell’s motivations. He believes that size and profit come with the correct interaction between company and community. “I’ve always been concerned with people and the people we have and the interaction between the community and the customer base. If you get the first things right everything else follows.”

Mitchell has thrown his support behind many community activities and is well regarded and honoured for his philanthropic efforts. Having come from nothing, it is important to him to be able to share the wealth, “firstly with my family. Progressively, I have made sure that my family are major participants in the ownership, and equally we’ve established a foundation where we put equal sums into it.” The Harold Mitchell Foundation has $10 million in funds and is growing. That $10 million goes to positive change in the arts and health.

There is no slowing. Mitchell is not one to retire and travel the world, he has taken the time (because his time is valuable and he manages it extremely well) to do the things he has always wanted while working. He has led a full life. He is the Chairman of the National Gallery of Australia Council, currently has Non-Executive Directorships of Care Australia and Opera Australia and is President of the Museums Board of Victoria. He writes a regular column for AdNews and has been involved with several radio programs. He has done what he has wanted taking the lead from his father. “My dad used to be a saw miller, his hobby is cutting down trees.”

Mitchell has been successful because he is able to spot trends, but most importantly, apply simple strategies and philosophies to all that he has turned his hand to.