EMI turns to Reckitt man to raise volumes in its music business
on July 8th, 2008 at 4:58 am· Leoni-Sceti’s task is to save £200m in operating costs
· Plans to shed at least 1,500 jobs and slash salaries
He has proved that he knows how to sell things that make your home shine, but Elio Leoni-Sceti is now bracing himself for a stiffer challenge: to make troubled music group EMI sparkle again.
The Italian-born marketing executive, who as a Reckitt Benckiser high-flyer has overseen the branding of products such as Cillit Bang, Finish and Airwick, was yesterday appointed as chief executive of EMI’s recorded music business, EMI Music, putting him in charge of star bands such as Coldplay and Gorillaz.
The 42-year-old described himself as a music lover, with “eclectic” tastes, namechecking three artists – the Beatles, Norah Jones and Coldplay – who all happen to be on EMI’s roster.
Leoni-Sceti said his 20-year career in marketing had made him an expert in understanding what consumers want – something EMI’s private equity boss Guy Hands has earmarked as a priority. “Branding develops an emotional relationship with the user that creates loyalty,” Leoni-Sceti said. “Creating brands and the values associated with those brands will be a possible value adder I could bring to this industry.
“Music deals with the human being, the choices that relate to the emotional side much more than selling a product … but the approaches and what levers will grow the business can be related.”
The elevation of a marketing executive to a key post in a creative company follows the BBC’s appointment of marketing head Tim Davie to be its new director of audio and music. The Channel 4 chief executive, Andy Duncan, who once masterminded the branding of I Can’t Believe It’s Not Butter, is another example of how media companies have been looking to marketing brains to steer their businesses.
Leoni-Sceti has been given the task of supervising EMI’s plans to cut costs by up to £200m a year and develop new ways of making money from music. Although digital sales are increasing, they are not yet offsetting the decline in CD sales, while piracy and illegal downloading remains a problem.
“Translating growth into financials is the number one challenge,” Leoni-Sceti said. “It’s about the monetization of growth.” He said he personally still bought CDs and also purchased music digitally.
His appointment allows Hands – whose Terra Firma firm bought EMI for £3.2bn last year – to step back from the frontline into the role of non-executive chairman.
Recorded music is the creative heart of EMI but has struggled to adapt its business model to the digital age. The music publishing business, which generates revenues from the company’s back catalogue, is far more lucrative and was crucial in attracting Terra Firma’s interest.
Hands has embarked on a restructuring of the recorded music business, pledging to make EMI “the world’s most artist focused and consumer friendly music company”. The controversial programme involves slashing artists’ salaries and cutting between 1,500 and 2,000 jobs.
Leoni-Sceti is the latest appointment Hands has made from outside the music industry, after former Google executive Douglas Merrill and Cory Ondrejka, the co-founder of virtual world Second Life. Leoni-Sceti comes from one of the FTSE 100′s highly regarded management teams, a protege of Reckitt Benckiser chief executive Bart Becht. For the past three years he has been responsible for Reckitt’s products in its core European market. He will start his job in October.
