Three years ago, Patrick Walldén sold of the majority of his 165 employee agency to a real estate billionaire looking to diversify his portfolio. Arena group was formed when Patrick created Engage, a new lead agency, and combined it with leftovers from his previous company: Kobama, a digital production agency; and Parapix, a film company. Engage works on building engagement within companies . . . and between companies and their customers . . . .to build brand loyalty. Patrick describes Arena as “where brands meet target groups and interact with them in some positive way.”
Rob met up with Patrick at the 2019 South by Southwest Conference in Austin, TX. The two discussed some of the differences and similarities between marketing in Scandinavia and in the USA—the most notable difference being the difference in market size. Arena does work with some large clients. Patrick describes Arena as an activation and communication agency which provides experiential marketing content and event marketing – theater blended with brands and events. A lot of what Arena delivers is product-based.
When Scandinavian Airlines faced constant pressure from discount airlines, Arena helped them establish House of Scandinavia, a physical and digital “bonding platform” where Scandinavian Airlines’ frequent flyers can interact with the company. The focus is on “all things Scandinavian” – food, innovation, and such trademark Scandinavian values as equality and diversity.
Arena creates big brand pavilions for such companies as Volvo and Ericsson in telecommunications. Before social media, it was difficult to get an ROI on huge event marketing platforms. Patrick believes that Social media spin provides the leverage that now makes these big events profitable.
Originally, people thought social media and digitalization would eliminate the need for physical interaction. Au contraire, Patrick claims. Social media actually drives the need to meet more in real life.
No longer are the high-priced marketing experiences targeted to VIPs. Social media has exploded the number stakeholders or influencers that can leverage this type of marketing campaign. So, business to business marketing is becoming more “personal,” – much of it is becoming business to individual or business to person.
How does Arena measure campaign impact? Patrick emphasizes the importance of setting clear targets from the beginning, knowing what you are trying to achieve, and knowing what you could lose. You not only need to know what you need to measure . . . but how you will measure it. If you don’t think it through from the beginning, you may be forced into “faking it” by clever post-campaign KPI placement.
Patrick has found the huge explosion of skilled gig freelancers in the past 10 years has greatly reduced the need for having a large permanent staff . . . agencies can now expand quickly to meet the demands of a large project . . . and easily reduce staff when the project is complete. He feels flexibility and the ability to quickly adapt will become increasingly essential for agency survival.
ROB: Welcome to the Marketing Agency Leadership Podcast. I am your host, Rob Kischuk. I am live here at South by Southwest with Patrick Walldén, CEO and Founder of Arena Group based in Stockholm, Sweden. Welcome to the podcast, Patrick.
PATRICK: Thank you. Great to be here, and I love your pronunciation of my name. It’s really good. You could move to Sweden.
ROB: I appreciate the coaching, and I should move to Sweden. Patrick, why don’t you start off by telling us a little bit about the Arena Group and what you’re great at?
PATRICK: Yeah, thank you. I love being in the USA because here you can actually say what you’re great at. In Sweden we have – a bit hard doing that. We have to learn to be more proud of what we actually do.
I think you have to go back. My background, I’ve been running agencies for 20 years. My experience mainly comes from experiential marketing. I’ve had a lot of events about experience agencies. Actually, I’m a journalist from the beginning. My whole background is a mix of content and event marketing. I sold my last agency 3 years ago, and the founders that left, we started this new team of agencies called Arena Group.
When we say arena, we’re talking about brand arenas. Arena is where brands meet target groups and interact with them in some positive way.
Under the Arena Group umbrella, we have actually three agencies. The lead agency we call Engage. That’s the lead agency. Engage, activation and communication agency. Then we have a digital production agency called Kobama and also a film company called Parapix. These three agencies are the core of Arena Group, the brand Arena Group.
ROB: Did you start with all three of those agencies on Day 1?
PATRICK: Actually, two of them were leftover from my former empire. [laughs] We tied them together and we started this new lead agency. That way we could quickly get more muscles when it comes to production and be able to deliver to our clients.
ROB: Who did you sell to?
PATRICK: We sold to an entrepreneur in Sweden. He’s a billionaire within real estate. I think he just wanted a communication agency to complement his other portfolio of companies.
ROB: How did you come to connect with the partners that you started the Arena Group with?
PATRICK: You have to go way back. Some of them have been along for a long time and some of them are new. I used to work with Eurosport for TV channel as a TV reporter. Some of the people I still partner up with, they come from that time. Then we have a next generation that’s a lot younger than me.
I would say in Kobama we have an average age of 28, and the film company maybe 30. The lead agency I think the average age would be like 40. So, we have seniors and then we have the young, upcoming guys that work on film.
ROB: On the lead agency, what does a typical client – if there is one – what does a typical engagement look like? What are you doing with them?
PATRICK: I think the name says a lot about what we do. We’re called an engagement agency if you search for companies in Stockholm. Today most of our clients have a big challenge getting involvement and engagement, both internally among their staff, their employees, and also among their clients. We try to find ways where we actually can make employees proud and involved and engaged about what we’re supposed to do in our companies, and also create loyalty among our clients’ clients.
We do that by doing – I would say we’re a campaign agency. We’re not super strategic. Typically, the process is 3 to 6 months and very often product-based.
ROB: Anything, in particular, that you’re recently proud of that you can share?
PATRICK: We do some interesting products with Scandinavian Airlines. That’s one of the reasons I’m here. We have created a concept called House of Scandinavia. I would say it’s like a bonding platform for the core travelers of Scandinavian Airlines. They have a payoff called We Are Travelers because SAS earn the majority of their revenue from frequent flyers.
Since they have been challenged by low-cost airlines for the last 10 years, we tried to focus on loyalizing their core business travelers. So, we created this concept called House of Scandinavia, which is both a physical place to go here in Austin, and also you can interact digitally with SAS both at home and here.
ROB: Those can be pretty interesting places. I ended up in the Comcast NBCUniversal house yesterday, and it turned out to be like the House of Philadelphia. Because they are from there. I guess you spent some time there. Did you see people you might not have expected to see at the House of Scandinavia?
PATRICK: Actually, it’s a lot more Americans coming than you would expect. This concept is about Scandinavian food and quite fine dining and things like that, so we brought some chefs from Sweden, Denmark, and Norway. It’s a great mix of Brazilians coming, Germans, and obviously the majority is still the Scandinavians.
ROB: I would imagine you’re actually in that case able to represent Scandinavia authentically rather than – I don’t know if you know Epcot Center at Disney. You get this caricature of each country. So, what are you communicating to people through the House of Scandinavia? What are you telling people that Scandinavia is?
PATRICK: Nowadays, it’s very complex to describe what Scandinavia (or Sweden, Denmark, Norway) is today. But I think we focus a lot on, since we’re here, there’s a lot of focus on innovation and being innovative companies when it comes to startups and things like that. But, also we have Scandinavian values, which we talk a lot about also. That could be diversity and equality and things like that.
ROB: Is Noma in that? Did you bring –
PATRICK: Noma was actually last year. We did that last year. That, as you say, used to be the most renowned restaurant in the world. Number one for some reason.
ROB: Very notorious, in a good way.
PATRICK: Exactly. We have a couple of others, but they are more or less on the same level. One guy we bring is called Paul Svenson, and he is a specialist of creating great food experience when it comes to vegetables. Vegetables you wouldn’t expect you would eat, and parts of vegetables you wouldn’t expect you would eat. He makes vegetables taste really cool.
ROB: Very interesting. I’ll have to ask you where that is when we’re done here.
PATRICK: He makes books also you can buy.
ROB: That’s pretty exciting and interesting. You’ve been to the South by Southwest orbit before. It’s often strange to ask someone how their own normal experience is different from other places, but what do you perceive, from having been here and talked to people, is different about running an agency in Sweden?
PATRICK: It’s my third time here in Austin, and first of all, I must admit I get sometimes a bit envious about the huge market that the U.S. is. Sometimes I say if we were having an agency in the U.S., it would be 10 times the size of our agency in Sweden without any larger effort because the market is so big, so you get a lot of leverage here once you get a big account or big client. I mean, Sweden has 10 million people, so it’s nothing.
Of course, when you see some of the projects down here – like an agency called Giant Spoon. They do the HBO activation for Game of Thrones. Last year they did Westworld. That would be fantastic to do that kind of project out of Sweden. But of course, we have to focus on our brands, like IKEA, H&M, Volvo.
But the number one reflection is, of course, how small our market is. On the other hand, when you work with smaller budgets, you still have to be – or maybe you have to be even more creative, actually, to make things fly.
ROB: Very, very interesting. Have you been to some sessions here? What have you been learning that is interesting that you’re taking back with you?
PATRICK: Since it’s my third time, I think I’ve learned to navigate. The event program is huge. You have to be selective. That’s the biggest challenge when you’re here, to do the cherry picking. You also have to realize that you can never visit everything. Of course, some of the keynotes will be good – yesterday I went to Amy Webb and listened to her trend survey, the digital trends within AI and things like that.
One of the main reasons I go here is there are so many great, smart people down here. It’s also a great place for networking. I could actually consider coming here without my Delegate Pass.
ROB: Absolutely, as I am. Because you are in this experience business, it might be worth tapping into a little bit of some of the experiences you have seen set up here and some of the traits you’ve seen that made them really good or not so good. What have you taken away of what people have done well that’s a good experience, and what people have done not so well that could’ve been a better experience?
PATRICK: Of course, it depends on the purpose of why they are here. My impression is that some of the brands that are here, like Twitter or Google or Mercedes or whatever, they are here for several reasons. Most of them seem to be here to find some kind of early adopter target group to start an interest or a spin around the new brand, like the Mercedes EQ, their electric car. There seems to be defined influencers that they can actually build from and then get a broader fan base from that.
Also, many brands are here since they seem to want to gauge internally – it’s a strong thing to say, if you work for Dell for instance, maybe you have the opportunity to be here and hang out with your colleagues, your clients, and your brands. I think it’s internal pride also for your company and your brand to be here and feel “I’m at the right company doing the right career.”
But of course, some of the things stand out. Like last year, it’s HBO activation.
ROB: HBO here is doing very significant Game of Thrones activation, right?
PATRICK: Exactly. It’s the Giant Spoon agency. They did Westworld. I was here last year, and that was a real eye-opener when last year I came and experienced the Westworld activation by HBO, because that was the first time I’d had a full, immersive, experiential experience where I actually became a part of the actual content or actual experience, together with actors.
They do a similar thing with Game of Thrones, which is really great also. That’s why it’s really hard to get in also. Long lines. Took me 2 hours, but we did it first day, before the crowd came here.
But on the other hand, you might say it’s hard to fail when you have such great content you’re working with. That’s one way of looking at things. But they also do it in a great way, I would say. It’s like theatre, like marketing theatre. That’s where we’re going right now. We’re theatre blended with brands and events.
ROB: What does the process look like for a client to decide that this sort of event to put together – that is really a one-time thing – is worth it? Do they come in believing it’s worth it and they want to know how, or does it take some persuasion?
PATRICK: We do some similar projects in Sweden and Europe for clients like Ericsson and Volvo where we create big brand pavilions. I would say before social media – I actually was around and I had agencies before social media. I even sent telefax in the beginning. [laughs] But anyway, before social media it was really hard to get return on investment on these huge event platforms.
But nowadays you can because you get the spin within the social media. That’s where you get the leverage and you get some exciting content that engages people. So that’s how we get return on investment, through social media.
ROB: We’re in the measurement business. How do you measure those campaigns and communicate them back to the client? Is it more anecdotal and subjective? Are there hard numbers that you like to present to them?
PATRICK: Both, I would say. There’s always a part of – there still is a gut feeling in this that we’re doing the right thing for the right target. But that doesn’t pay the bills. You have to be certain about what you’re talking about.
One important thing from my experience is to actually set up clear targets from the beginning. What do we want to achieve here, and what could we actually lose here? What would an alternative be? You have to be clear how to measure this before so you don’t try to do a construction afterwards where you have to be really clever when you put up the KPIs.
ROB: There’s many things you see now that feel like they are designed for Instagram more than actually being there in person. How has the social media impact changed how you design an experience? Are there more focal points now that are really set up to be juicy, visual, and ready for a phone picture?
PATRICK: If you walk around here in Austin, you will see there’s Insta photo opportunities. That’s what people are chasing here. Even if you go inside the event venues where people are listening to the keynotes, you can see most of the people are not actually listening, but are at the same time posting things on LinkedIn, Insta, Facebook, etc. It’s so integrated today, the social media and events.
I remember when social media came and there were people saying, “This will be the end of event pieces because now we don’t have to meet physically. What’s the point? You can just email or you can talk on social media.” But the funny thing is that social media and digitalization is actually driving the need to meet in real life more.
From my point of view, the social media explosion has been fantastic since it’s driving the need for more events also. It’s like a symbiosis.
ROB: It seems almost like, at one point, events needed to be designed for a VIP because the VIP was the only person who could possibly justify the return and the amplification of what you did.
ROB: Now, you can provide a VIP experience at a larger scale, but it’s interesting because you’re designing a little bit for what goes through the phone rather than through the person who’s there.
PATRICK: It’s interesting to see the trend moving from doing business-to-business, and now it’s more like business-to-people in a way. There’s so many stakeholders or influencers that can have leverage in your marketing. It’s really interesting. This used to be the B-to-B VIP activation, but now it’s open for everyone.
ROB: That’s probably an interesting thing to dig into a little bit. One thing I think we see here that is different – it’s not surprising necessarily when Twitter or Mercedes-Benz has a setup for consumers. But we also here see SAP set up with a very large and very prominent event space. How are things different, maybe, when you are – SAP is a business-to-business product with a very high price point.
PATRICK: German also. [laughs]
ROB: How do you design those experiences differently from Samsung, where it’s like, “Look, here’s our phone”? They’re doing that, but SAP, Accenture, they are here as well. Those are different events.
PATRICK: I totally agree. I work a lot with a company called Ericsson in telecommunications. They are a B-to-B company also, selling 5G equipment and things like that. They are also moving more to getting inspired by the traditional business/consumer communication. I would say that’s a big trend we can see. Traditional B-to-B companies, now they act more like Samsung and more of the car brands. Even though they target B-to-B, they still want to act more cool and be more open. We will see a lot more of that.
The thing is, the effect gets almost stronger if a more boring company, like Price WaterhouseCoopers, do some cool stuff. Then it’s unexpected. It’s like, wow, are they doing this? So, the effect can be even stronger, I would say. In the future, I don’t think we will see a lot of difference between traditional B-to-B and B-to-C. It will all blend together. Like I said, business-to-people or business-to-human.
ROB: Interesting. Ericsson actually lives in I think a very interesting place in the market, because, as we are in the middle of this 5G rollout for phones and for everything, possibly for your home internet – I feel like we don’t even fully know – Ericsson lives in a place where they are notably not a Chinese company.
What I mean by that is, there’s a lot of sensitivity that most of the 5G providers are from China, and Ericsson is not. It almost seems like some of the angle may be to be a friendly and familiar brand that you can trust, that is not from China – because the number of access points you have to roll out for 5G is tremendous.
PATRICK: It is. I think this almost surprised the Ericsson company a little bit because they don’t really know what to do with this from a marketing perspective.
ROB: [laughs] It seems almost untouchable, but you have to.
PATRICK: Because they are a democratic company, long tradition. I don’t know, 150 years they’ve been around. So, they’ve been around for many, many years, and suddenly they have this opportunity, especially in the Western world, to have this unique selling point: that they don’t have any strange built-in things in the system and being the democratic choice. This is a great opportunity for Ericsson.
Just a couple of years ago, Ericsson was really under pressure. It was almost that they were going to be going under as a company since the Chinese, Huawei, has been such price pressure. Now suddenly this could be a great comeback, I think.
ROB: It seems like an interesting line to thread. How do you seize the market opportunity while still – you kind of have to communicate that you are nice and friendly and safe.
PATRICK: Exactly. I think also, the best way is if they don’t actually have to communicate that, but if you still feel it without saying it, in a way. That would be the best way. Ericsson is a fantastic company in many ways. They have great values. So, I think it can be experienced that way without them actually having to say it.
But maybe they have to say it a little bit more. Be more American, like I said. Say, “We’re great.” [laughs]
ROB: Yeah. You mentioned this yourself earlier as we were talking here, as well as yesterday when we met – which is part of the wonderful serendipity of South by Southwest, sitting in the lobby of the JW Marriott and saying, “Hey, let’s do a podcast tomorrow. You’re doing some really interesting work.”
PATRICK: Exactly, I like that.
ROB: But you mentioned that you are a little bit more inclined to put yourself out there than a lot of your peers.
PATRICK: Yeah. I’m definitely not typical Swedish. Most of my Swedish friends think, “You’re like an American. You always hand out your business cards and you talk to strangers.” [laughs] That’s usually not the typical Swedish way. Until you get a couple of drinks. Then the Swedish start talking. [laughs] We talk a lot here in Austin, during nighttime anyway.
ROB: What is the beverage of choice?
PATRICK: For Swedes? I think they would start typically with beer, and then it will transform to vodka later in the evening. [laughs]
ROB: I believe that. Patrick, tell me a little bit about, in building the Arena Group, what are some lessons you’ve learned that you might do differently if you were starting from scratch today?
PATRICK: It’s quite new. It’s 3 years now we’ve done this. One of the many takeaways from my other company, which was quite big – it had 165 employees, which is big for being in Sweden – in those days, it was hard to find skilled freelancers.
Now, the last 10 years, at least in Sweden there’s been a huge explosion of skilled freelancers within the gig economy. So suddenly you can expand your business. When you have big projects you have to deliver on, it’s much easier finding additional freelancers now than 10 years ago. So, I don’t think you have to have a huge staff on the pay list, because now it’s easier to add staff than before.
That’s one learning, to focus on the core team and then work in tight cooperation with your network. That’s the way you have to work today to be able to get any profitability from a company.
ROB: Those freelancers, are they local?
PATRICK: Yeah, it depends on where we’re working. We might be out in the big world doing things, so then we of course find freelancers with some international background. But they’re diverse also, the freelancers that we use. Copywriters or creative designers or digital experts or similar skills. But they could be Swedish, Nordic, European, American.
ROB: Right. I think that’s something that a lot of our audience probably hasn’t thought too much about, filtering freelancers by language competency.
PATRICK: It’s a big thing in Sweden. Actually, if you would come to Sweden, being American or English, then you would have a great opportunity to get a job within a communication agency since many of our clients all communicate in English, like Volvo, Ericsson, IKEA, because for them, the world is their market.
It can be very strange. We can sit in a room in Stockholm, like 10 people or maybe 15, and there could be one person not speaking Swedish and we all speak English. It’s quite common. Being a small country, we have to learn the big languages.
ROB: Right. IKEA seems like they have also learned to communicate in pictures. How much of a trend is that? Is that something that is somewhat common? Regionally there are multiple languages, but also English, so the best way to communicate is by being visual and keeping the copy light? Is that common?
PATRICK: I would say that’s definitely common, since visuals or photos are harder to misunderstand. Let’s say you’re doing things in China, where the culture is more far away from the Swedish/Scandinavian culture. Then you take less risk using photos or symbols and things like that. On the other hand, the IKEA things that they actually sell in the IKEA shops, they have really strange Swedish names. [laughs]
ROB: Yeah, they don’t try at all to –
PATRICK: Exactly. Which is pretty cool, actually. It’s part of the experience, I think. It’s like when I come here to Austin. The first thing I asked myself is I want to experience something with authenticity. Like yesterday I went to The White Horse, a typical cowboy feeling bar. [laughs]
ROB: Very interesting. What is coming up for the Arena Group or the broader picture of marketing that you are excited about?
PATRICK: My own background is from journalism, working with a lot of editorial content. I think most marketing agencies have to – already today, but even more in the future – be organized a bit like a traditional newspaper or TV channel. You have to have this team that quickly can feel what the target group, readers, what they want. You have to be very flexible and quick to change, be able to adapt.
I can see a trend that marketing agencies are transforming into being small – it’s like being a group of reporters, almost.
ROB: Very interesting. Patrick, when people want to reach you and the Arena Group, how should they find you?
PATRICK: They should email me, I would say. That’s the best way. We have arenagroup.eu, like the European Union, so they can find my contact information there.
ROB: Excellent. Patrick, good to meet you this week.
ROB: Good to have a chance to learn more from your expertise here on the podcast. Thank you so much.
PATRICK: Thank you. Great being here.
ROB: Have a great week.
Thank you for listening. The Marketing Agency Leadership Podcast is presented by Converge. Converge helps digital marketing agencies and brands automate their reporting so they can be more profitable, accurate, and responsive. To learn more about how Converge can automate your marketing reporting, email email@example.com, or visit us on the web at convergehq.com.