Michael Nathanson: Thank you. I have two for you, John. One is, as you’ve referenced before, you’ve had a very strong year in the media business. You’ve taken a lot of big wins. Can you talk a bit about what’s changed for the positioning of that business? What do you think are the factors driving some of these big wins that you’ve had versus your competitors? And secondly, I have you asked in the past about acquisition opportunities. Given now maybe the fall in kind of the pressures in venture capital land and the higher rates, talk a bit about the pipeline opportunity you see to kind of buy more companies in ’24 and then kind of your willingness to do that in ’24. Thanks.
John Wren: Sure. I think the success of the media operation is down, one, to management of that specific operation. We’ve expanded the suite of services that we make available to clients in the media area. It is, of all of our services, probably one of the most measurable in terms of when we utilize the data and the amount of data that we have, we’re able to optimize for the benefit of the client how they spend their money, improve it. So there’s a great deal of analytics that are there today that weren’t even possible four or five years ago. And I think, well, I do know this to be true. We have a reputation of delivering on what we promised when we’re pitching for business. And I dare say we have the best reputation in the industry of delivering what we promise. And that has benefited us through this process.
Phil Angelastro: Do you want to comment first on M&A? And then I’ll add.
John Wren: Sure. Yes, we’ve always had — the M&A pipeline remains very strong for us. We have a team that’s constantly looking at opportunities. They have to meet all of our internal criteria. It would have to typically be something that’s additive to the portfolio of services that we offer our clients. If it’s something that we can build and is expensive, we’ve steered away from it in the past, and we’ve been pretty consistent about that in the last — at least the 26 years that I’ve been the CEO. But there are opportunities, and some of them are in areas that we’ve had on our list for a very long period of time that looked more reasonable than they did when the interest rate was zero.
Phil Angelastro: Yes. I think that what we’ve seen certainly is that sellers’ expectations have kind of adjusted to the marketplace and to the macro environment that we’re dealing with. So strategically, there are some opportunities out there that we’ve been looking at, some of which we completed in the third quarter, that have been more attractive than they certainly were not that long ago.
Michael Nathanson: Okay. Thank you, guys.
Phil Angelastro: Sure.
Operator: And the next question comes from the line of Craig Huber with Huber Research Partners. Please go ahead.
Craig Huber: Thank you. I’ve got a few questions. I’ll maybe just go one at a time to make it easier. Can you just talk a little bit further about the tone of conversations with your clients as they say what their thoughts are on a preliminary basis for 2024, at this stage, maybe versus what the conversations were like roughly six months ago?
John Wren: I think, well, there’s still a lot of uncertainty in the marketplace because of all the things we talked about and in previous answers in our prepared remarks. Having said that, clients are pretty sophisticated, and they know that, no matter what the difficulties are, they have to continue to support their brands because if they don’t, when the good times return, they’ll have a much more difficult time regaining or maintaining their market share. So as we look at clients in ’24 — ’23 was a tough year for many sectors. And that’s why we referenced a couple of times earlier the tech sector. I would say, in my opinion, ’23 was the first time in the tech sector had to face readjusting its business. And people, earlier in the year, went through massive layoffs and cutbacks of their own staffing, which they hadn’t had any experience in their history of even needing to do.
It was pure growth prior to this year. That’s behind them now. They’re a lot more experienced than they once were as we look forward. So clients aren’t — they know we’re not through all the hurdles that exist out there, but they’re confident that their brands and their positioning from their companies, they’ve taken a lot of pain and they’re positioned well to go into the future.
Phil Angelastro: Certainly, a lot’s — it’s been an odd year. Certainly, a lot has changed, especially if you compare things to the last six months. But as we were going into ’23, about a year ago, most of the conversations were about was there a recession coming, was it likely. And I think 12 months ago, it was more likely to happen in the first half, then it changed to more likely to happen in the second half. It’s kind of been happening in slow motion. So the recent events in the Middle East certainly have changed things versus six months ago. But, yes, I would echo John’s comments in terms of our view on ’24 and client sentiment, they know they need to continue to invest in their brands. And I think that’s been proven certainly throughout the cohort period.
John Wren: And you can’t forget that, if you go back a year, interest rates were quite different for everyone. And sure, there’s been a lot of sudden changes as the Fed has increased rates, and it takes people a bit of time to adjust what they’re doing to those changing environments. But I think at this point — everyone thinks — they don’t know when it’s going to reverse itself, but they’re adjusting to the current environment, and they don’t think they’re facing the same headwind in areas like that going forward. So again, it just adds to the confidence.
Craig Huber: Thank you for that. My second question, if I could, on a pricing, apples-to-apples pricing, for your clients, just in aggregate for your company for this year. How do you sort of think about it, your 3.5% to 5% organic growth target for the year, with 5% being a stretch target? How much should we think about that pricing in terms of maybe basis points as adding to that? Is it roughly 100 basis points from pricing on apples-to-apples basis, not just upselling but pricing on apples-to-apples basis, that you’re increasing prices in your contracts and stuff? And where that number is roughly for this year, at a 3.5% to 5% target for this year, how does that compare to prior years? I’m trying to get at this because it’s obviously a higher inflation environment.
