Blackstone Group Doubles Down on Ad Industry Investment as John Bernbach Becomes Chairman of Ai Media

Former DDB president to advise the real-time marketing company

John Bernach is the chairman of the board at Ai Media.
Omnicom/Blackstone

Last October, private equity firm Blackstone Group entered the digital media and marketing industry for the first time in its 30-plus year history by acquiring a minority stake in Ai Media, a search engine marketing organization that defines itself as an agency rather than an ad-tech company.

This week Blackstone, whose CEO Stephen Schwarzman currently serves as President Donald Trump’s economic advisor, reinforced its investment as Ai Media named John Bernbach chairman of the board.

Bernbach is a 45-year veteran of the ad industry who spent more than two decades at DDB, the agency launched by his father Bill in 1949. He had been advising Ai Media as CEO of the consulting firm The Bernbach Group, and he will work with company leaders moving forward to help the company expand and develop new offerings.

“Historically we haven’t made much of a play [in the ad industry],” said Viral Patel, managing director of Blackstone’s Tactical Opportunities Fund, noting that Ai Media’s performance-based business model was particularly attractive to investors.

“Think about the trouble with transparency, especially on the agency side, over the past year or so,” he continued. “Ai’s approach to the space is based on measurement; they consistently work with customers to find KPIs, and that level of accountability is very refreshing in the marketplace.”

In short, Ai bases its fees on “measurable outcomes” rather than using the established CPM or “cost per thousand impressions” approach. “Lots of ad-tech guys do this,” added Patel, “but Ai is much more of an agency: They manage campaigns rather than sell software to the agencies.”

Patel said that this approach, combined with a series of longstanding client relationships, positioned Ai Media as a more secure investment than a pure ad-tech company.

Bernbach introduced the company founders to the equity firm, and his appointment effectively serves as the second stage in their relationship.

“I admire what Ai Media Group is able to do, their ability to understand and find deeper connections between brands and consumers,” said Bernbach in a statement. “They are able to understand the customer journey better than any media company out there that I’ve seen, and I’m thrilled to play a part of their future growth.”

Bernbach helped facilitate the 1986 merger of DDB, Needham Harper Worldwide and BBDO that created the Omnicom Group, and he subsequently served on the holding company’s board as one of its five original directors while running all domestic and international operations for what was then known as DDB Needham. He launched his eponymous advisory firm in 2015.

Several media and tech industry veterans launched Ai in 2008 to fill a perceived need for real-time marketing services. The company’s client roster currently includes Ferrari, Time Warner Cable, Allstate, Porsche and Met Life, among others.