Pedro Lerma Full Episode Transcript:

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Hello everyone. Welcome to Question Everything, a podcast all about learning from the successes and the failures of those who dared to, well, question everything. This podcast is part interview, part therapy, and part Price is Right. We have our own game board stacked with questions that'll make even the most successful CMO sweat. I'm your host, Ashley Walters, CMO and partner at Curiosity. On today's episode, I sit down with Pedro Lerma, CEO at LERMA/, a full-service cross-cultural agency known for its Super Bowl spots, and award-winning work for Home Depot, Salvation Army, and many others. Between industry war stories and heartwarming tales, today you'll learn three ways to infuse cultural fluency into your creative. The real story behind the He Gets Us Super Bowl ad backlash, and how Pedro turned his biggest mistake into a lifelong leadership philosophy. So plug in and get ready to rock out. This episode is going to light up the charts.

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Pedro Lerma Full Episode Transcript: Pedro Introduction

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Pedro Lerma is the CEO of LERMA/, an agency acclaimed for its innovative and inclusive approach to the industry, earning back-to-back Ad Age Small Agency of the Year titles and A-list standout in 2024. Additionally, Pedro has been recognized as Ad Age Executive of the Year. and as an inductee to the Southwest Advertising Hall of Fame. Besides being known for producing Super Bowl spots for brands like Avocados from Mexico and He Gets Us, Pedro is also known for his unique approach to leadership. All right, Pedro, welcome to Question Everything. How are you? I'm doing great. Thanks for having me. I'm excited to be on my first game show. Awesome. I'm excited to have you. This feels like. I don't know, for me, this is a very iconic moment. I have followed you.

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I have followed your agency. You guys have done some really remarkable work. From what I can tell, as an outside fan, you do it the right way. You lead with kindness and compassion. And inclusivity is just part of your DNA. And I cannot wait to unpack some of that today. Okay, so you know how this podcast works. We have a game board stacked with 12 super spicy questions and the power is completely in your hands. So what's your favorite number? Well, I don't want to go for seven because I've watched your podcast and lots of people pick seven. So let's go with number five. Okay, okay, I like that. All right. I love this photo. So for the people listening who cannot see what we're looking at right now, I want you to explain this photo and then talk a little bit about how your experience as a musician has shaped your view of creativity and culture.

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Pedro Lerma Full Episode Transcript: How music shapes LERMA/’s creativity and culture 

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Ooh, so explaining the picture, I think it's probably the easiest part of that question. It's a picture of me with a guitar standing on our stage. We have a stage here in the office. It is set up all the time. So we have drums, guitars, amplifiers, we have PA system, lighting, everything. And we have an annual holiday party where we will hire a professional band. So we are all— I say we all. Lots of people within the agency are musicians. Um, But I would call us recreational musicians and we bring in professional musicians for those parties. And. From time to time I will get up there and do a song or two with the band and it's a lot of fun. So cool.

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Um now I guess to answer the second part of your question, um how I guess my love of music has influenced our work. I feel like audio is such an incredible way to make connections with people. Yeah. I used to think that music was really about the beat patterns or the chord progressions or even the lyrical content, and it is. But there's also a physiological part to enjoying music that is um more about the vibrations and what your body feels. And there are certain notes or tones that make you relax, make you excited. And so there's this whole other part of audio being a way to to make connections that to me is fascinating and. And it's been something that we pay a lot of attention to.

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A lot of the work we've done has featured music as a big part of it. A couple of Super Bowl spots where we had a cover of NXS's. Never tear us apart. And our most recent Super Bowl work for He Gets Us featured Johnny Cash. um doing a Depeche Mode cover, which was amazing. Music is a big part of who we are as an agency. but also a big part of our business, as you know. That's cool. And from a culture standpoint, like I can't even imagine what it's like to be an employee up there— just like jamming out with the CEO. That says a lot about you as a leader and the kind of environment that you're creating in the office as well. Well, I just said I've always enjoyed music.

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Pedro Lerma Full Episode Transcript: How LERMA/ takes DEI a step further – and how that translates to results

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It's a big part of my life. Um, and I wanted us to have— A way for us to express our creativity beyond just what we do. For work and so it's been a really neat part of our culture. I think that's really really cool. Thanks for sharing that. Sure. All right, let's go back to the board. Okay. Now let's go with number seven. Okay, okay. So Home Depot, one of your clients, was named one of the most culturally inclusive brands by ANA. And as you know, many agencies talk about inclusion as who has a seat at the table. And I know you do as well, but you guys go so much deeper than that. And I'd love for you just to talk a little bit about inclusion, especially as it relates to the creative product and your philosophies there.

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Okay. Well, inclusion has always been really important to us. We started as a Hispanic agency and evolved into what we call today a cross-cultural agency. But built on the foundation of multiculturalism. And so that's always been a sensibility. That we have. But we've really leaned into. We have a practice here called cultural fluency. And that practice is to do three things, and that is to elevate, mitigate, and grow. I'll explain that. So elevating is making sure that we represent communities, often underrepresented communities. We need to make sure we represent them in authentic and respectful ways that we're lifting those communities up. The second part of that is to mitigate, and that is to mitigate reputational damage.

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As you know, there's been a lot of that in our industry in the last year, and so we work really hard to make sure that we don't make missteps when it comes to inclusion. and the last part is to grow. My guess is that you, as head of new business for Curiosity, have seen lots of new business briefs that ask you to connect with a growth audience, but to do it in a way that doesn't alienate the legacy customer. And so, our practice helps us ensure that we do that. With a brand like the Home Depot, we've been working with them now for 15 years. They have always been, uh, big believers in the black and the Hispanic customer base. And so they have had a long-term relationship with that customer base, which I think is foundational.

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I tell people, if you're going to go after a new growth segment. You need to make sure that you stand behind the idea that we have had a real relationship and we have supported this community. Uh, up until now, um, because if not, you know it's often seen as performing, and so our cultural fluency practice is just an incredibly important part of what we do, and it makes sure that we, you know, deliver the kind of work that we've delivered for the Home Depot that has helped them. You know, be recognized by the ANA as multicultural brand of the year. Hmm. That's fascinating. So true. Is this a true story? Did I read this correctly? So, Home Depot, your beginning relationship with them was you were serving as the multicultural arm of the agency responsible for that. And then you won full AOR duties. So is that true? I want to clarify that. We are the Hispanic Agency of Records. But um, there was a point in time when they had to part ways with the Richards group. Um, something you probably know about. And they continued with us. So we were in a position to help them through a transition period. They knew that they wanted to hire another agency to replace the Richards Group in their roster. But for several months, while that process was happening, we took on all of the work. And so we weren't AOR. But we were doing both Hispanic and general market work for them. And so eventually they hired a new agency, BBDO.

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They've gone on and done a lot of great work for the Home Depot as well, but it put us in a different position with the client, where they see us now as not just a Hispanic agency, but an agency on roster. And we have done lots of general market work. And continue to do so. And we're thrilled with the expansion of that relationship. I think that's fascinating. Just that, like, even just a slight even just shift of your roster status, I think probably is a big contributor to a recognition like this. The ANA when it's not just like done in a silo or a side agency. You're actually part of the big brand briefs and opportunities. So, you know, kudos to everything that you're doing on that business.

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Pedro Lerma Full Episode Transcript: What the creative process for a Super Bowl spot looks like

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That's really incredible. All right, let's go back to the board. Where are we going next? Are you going to stay in a line? Let's go with number one. Okay. Up to the top. All right. So you've produced multiple Super Bowl campaigns. I actually was eating some avocados last night in preparation for this. So I'm really curious because we have not done a Super Bowl spot yet. How, if it does at all, how does your Super Bowl creative process differ from your traditional, you know, everyday creative process? I would say it differs in that there are a whole lot more people involved in it. We have here three different creative groups, and they work on different sets of accounts. And when the Super Bowl comes around, it's really kind of an all-agency, kind of a process.

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Um, as you know, great ideas can come from everywhere. There are teams that know a client and know a brand really well. And sometimes it's good to bring in somebody that just brings a new perspective to it. I would say that's really about the only thing that changes. Doing a Super Bowl spot versus doing any other spot. All hands on deck. Yep. How early do you get started? So we've got the Super Bowl coming up not too far from now. Are you already thinking about it or would you typically be thinking about it by now? Uh, well, it depends a lot. Often, that's driven by our clients. Clients might be ready earlier, in that period of time. Sometimes, you know, we're scrambling at the last minute. That's not unusual.

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We know other agencies that have worked in the Super Bowl. And it can get pretty crazy leading up to the week before the event. Right up to the week before the sequence. Cool. All right. Let's go back to the board. 

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Pedro Lerma Full Episode Transcript: Why trust isn’t built by being perfect, but by being accountable

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Where do you want to go next? Let's go with number 12. Number 12. Okay, so you've said that trust isn't built by being perfect. It's built by being accountable. How has this proven to be true in your career? So I think where that quote came from was an article I wrote about just kind of lessons I'd learned in the industry. Early in my career, I had a furniture brand, and we were a small agency. I grew up in Bristol, Falls, Texas, and started a small agency there.

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We had a media schedule that was supposed to run, and for whatever reason, uh, one of his spots didn't run, and I knew it was going to be a big deal. I was really nervous about it. But I walked into his office. Um, took complete responsibility. I don't remember if it was my fault or somebody on the team. Nonetheless, I felt responsible. Um, I owned up to it. I told him what I was going to do to make sure that that never happened again. And I really expected. Thank you. An ass chewing, and instead, you know, he said something to the effect of, you know, I appreciate your integrity in this, and I do trust now that it won't happen again. And this was a client who was not an easy client.

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For him to respond that way was really impactful. And as a result, you know, I've just kind of carried that idea with me. Throughout my career. If you make a mistake, own up to it. It's okay to be vulnerable. Um, but along with that vulnerability, you know, talk about what you're going to do to make sure it doesn't happen again. Yeah, I think that's really great advice, especially as you're starting to enter your career, but then even in an elevated leadership role. One of the things that I say a lot is: 'you know, oops, and ouch, you know, oops, it's just such an easy word.' Like when you've made a mistake, it's 'oops,' you know, and then you kind of explain yourself and say what happened.

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And then, also on the reverse is, 'ouch,' like that hurt. What was said or done had an effect on me. So you can have an open and honest conversation about it in the moment. I think is really important. We love that. I'm stealing it. You should. You should. I actually, I use it on my kids quite a bit as well. It works for them. Yeah. And I've, you know, I've said it a fair amount of times in my career too. So, all right. Great story. I think. There's a lot of lessons in that that we can learn. I imagine that shows up a bit in your values too in your organization today, and how your employees kind of handle their client relationships as well, which is really cool.

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Pedro Lerma Full Episode Transcript: Why Luis Messianu, Richard Edelman, and Pedro Lerma formed the MEL agency

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All right, let's go back to the board. Let's go with 10. Number 10. Okay, so you recently joined forces with, how do I say it? Mizanu? Yeah, I know. And Edelman to form MEL, which is a minority-owned Hispanic-led full-service communications agency. I'm super curious to learn a lot more about this, but tell us what does this collaboration represents to you personally and what larger shift do you hope it signals? It signals for the industry at large. Um so the partners in that are Luis Miguel Messianu, he is a well-known creative talent primarily in the Hispanic market, but he's well known beyond that. The other partner is Richard Edelman. From Edelman PR, the largest PR firm in the world. And we set out to build a Latino-focused earned media.

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The thought was, that within public relations, there is an opportunity to bring more creativity to those solutions. And then, within the Hispanic market, that really hasn't been addressed. And so that came at a time when Luis Miguel was leaving ALMA, the agency he founded in Miami, and within the DDB network. I happened to run into him in Paris, France. On our way to Cannes. I spent some time in Paris before that, and he was in the same hotel I was in. Didn't know that. But we ran into one another. And that happened the night before Ad Age announced that he was leaving Alma and launching his own agency of consultancy. And so I ended up reaching out to him, congratulating him.

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And then, when we got to Cannes, I talked with him about the vision I had, which was—um— to better represent the Hispanic community and to do it in a way that was really lifting up the community and helping brands forge authentic connections through earned media. And a lot of what he had in mind for the practice that he was going to build. Um was aligned with that so we talked on one day. We had breakfast with Richard Edelman the next day in Cannes. And so that was in June. And by September, we had launched an agency. It's been a great, great experience. Luis Miguel is somebody that I had admired for a long time, and now, working with him, I have an even greater appreciation for him.

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Richard has been a huge champion for the Hispanic Latino community. His wife is very involved, Claudia Romo Edelman, in the hispanic community and so it's been a great great partnership and really excited about that. So are you splitting your time between both organizations? how is that working for you personally? So I am ceo over both companies. But Luis Miguel is a grown-up. we tell people here. Built an amazing agency before this. and so, he really runs the day-to-day, Chief Creative Officer, and essentially CEO. Okay. And is the strategy, are you partnering with other agencies? What's the kind of growth plan there? We have. Some of the brands that we've worked on are within the Edelman portfolio. Others are because of relationships that I have had or Luis Miguel has had.

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And in many of those cases, there are other agencies in the mix. As you know, that's more common than not. And uh, and so it's it's just been A lot of fun building something else. Awesome. Very cool. 

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Pedro Lerma Full Episode Transcript: What being a service-minded leader looks like

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All right, let's go back to the board. You're not busy at all, are you? Dual CEO. That's great. Let's go with number six. Okay, number six. So you've said that you see leadership as a service rather than an authority. What does that look like? And what do you consciously do to be a service-minded leader? Yeah, I tell people I exist here to support you. Everybody that works, um. And so, you know, I often ask. What can I do to support you? What can I do to help you?

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Um, it really comes, I guess, from just my leadership philosophy. There are a couple of experiences that I've had. The first was early in my twenties. I went through the Dale Carnegie course, which was a public speaking course, but it's really so much more than that. Is really a course on human relations. As part of that, I learned a lot about. Uh, leading. I learned about knowing how to deal with difficult situations and I came to realize it was a lot of empathy-led approaches. I later read an article. And it was about emotional intelligence. And it referenced a book called Primal Leadership. And in that book, it talks about four characteristics of a great leader. That has emotional intelligence. And the first was um, self-awareness.

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So I know what I'm good at, and what I'm not good at. Second is self-management. So I'm going to put myself in situations where my strengths shine and my shortcomings are somehow compensated for. The third is social awareness. So I know the strengths and weaknesses of the people around me. And within the agency, I often talk about That includes our clients. Our clients have strengths and weaknesses. And we have to consider those things. And the last is relationship management. So self-awareness, self-management, social awareness, and relationship management. And that has really. When I read that, I thought, well, this is. A lot of how I've been behaving, I didn't realize there was a structure to it. And so I really embrace that structure. I give. The book away, Primal Leadership, all the time.

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I will send you one. I would love that. And the other book that I recommend a lot is How to Influence and Influence People, which is Dale Carnegie. But those Those two books and those ideas really shaped. Who I am is a leader and I consider myself a lifelong student of leadership. Um, You know, sometimes I think I happen to be in advertising, which I love. A thorough love of this industry and what we do. Um. But I've been a lifelong student of leadership. If the world blew up and I had to do something else, I think I could probably do okay. Hmm. I read— I was reading, you know, comments and articles preparing for this. And somebody said, 'You are the kindest leader. They've ever witnessed.

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And I thought that was pretty remarkable of a statement to make, because I think sometimes people can conflate kindness and success, and the fact that you're able to do both so well. I think there's a big lesson there. So I appreciate you sharing that. And we'll make sure we link to those books, too, if anybody wants to grab a copy themselves. How do you train your leaders? How do you make sure that they're developing their skills? Well, a lot of it, a lot of our careers. We haven't had a lot of training. I know.' Beginning of this year, we hired a company called Exec Guru. Okay. And they are— executive coaches and so. Every one of our senior leaders has been going through executive coaching.

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It has been a really, really eye-opening process because, I guess, there are i guess truths that they have shared with us, they have helped us identify blind spots in ourselves, and it has been a real growth experience for all of us and so I would say that's the most recent thing that we've done to really train the people here. A lot of it has just been leading by example. And. You know, communicating a lot, making sure that we're all on on the same page, and that we have similar philosophies around leadership. And it feels like, as a result, we built it. A great culture. Um, where Kindness is Is that the foundation? That's great. All right, let's go back to the board. Let's go with number four. Okay, number four.

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Pedro Lerma Full Episode Transcript: The headline that should’ve been written after the viral 2024 He Gets Us Super Bowl campaign 

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The 2024 He Gets Us Super Bowl spot drew some backlash for looking AI generated, even though it wasn't. And so, if you could rewrite that headline today, what would you have wanted it to say? Well, it might be something as simple as you might have thought that this was AI, but it's not. And it's kind of an interesting time to be having that conversation because, you know, J. Crew. and guests have both recently faced backlash because they use AI in some of their communication. I feel like. A lot of people. Well, they're starting to feel like they want. more authenticity. in the imagery, right? And I feel like it's a time where we need more human connection and not less. I will say specifically with the He Gets Us. Super Bowl ad.

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We worked with a fine art photographer. Her name is Julia Fullerton Batten. and she is amazing but her style is this surreal, hyper-realistic style. And if you go and look at any of her work, Um, you know it might make you think about AI, but it's not. It was absolutely. human, real people. and work that we're really proud of. It was beautiful work. I mean, yeah. What was it like at the office? Did you anticipate this? Were you surprised by any of the feedback? Well, as part of our cultural fluency process, we— We go through a little bit of an exercise before campaigns launch to um to try to anticipate any any concerns right somebody uh might raise a concern or you get some backlash and we want to be prepared for that Um, In this case, we did not anticipate that.

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There were lots of other things that we kind of prepared for, but not that way. I imagine. I read some about how you won this business and how you were the perfect agency for it. And I love how you kind of position that journey. Just curious, what was the client's perspective? Were they surprised by some of the comments or were they okay with it? From their perspective, I think that people thinking that it was AI was the least of their concerns. That campaign has been incredibly impactful. I would argue one of the most talked about campaigns in Super Bowl history. Um, A lot of that. So. conversation is really positive. People love the work. But it is the kind of work that gets criticism from people on the far right, people on the far left.

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and the way we've always thought about it and the way our client thinks about it is: If you're upsetting those people, you're probably doing something right. And the other thing that we think about is: What we say is your reaction to. That he gets us work whether it's in the Super Bowl or anywhere else says more about you than it does about the work, and so in any case, that. That work has been incredibly impactful. Work that we're really proud of. Our agency vision is to channel creativity for good. And so, whether we're doing that kind of work or doing work for the Home Depot or we've done work for avocados from Mexico, as an example, and we say, um. We want to do. Work that, when people encounter it, it enriches their lives in some way.

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And so, like with avocados for Mexico, if we can put a smile on your face, we feel like even if just for a moment, we've enriched your life. Um, for the Home Depot, if we can help you improve your home, the home is an important part of your life. Um, salvation army— if we can get you to be more philanthropic, we believe that that will be um something that enriches your life, and so with him, we get us. If we can get somebody to stop and consider their faith, that that's pretty impactful. Very. Messages you know hundreds and hundreds of messages. But people have told us we've had a dramatic impact on their life— not just with the spa, but also as a catalyst for a spiritual exploration of some sort.

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We have had people—say, that they were considering taking their own lives. And they saw an ad. It stopped and went a different direction. And so. Um. You know, if doing this kind of work results in some controversy here and there, but it means that we're impacting people's lives in that way. I'm good with it. You're doing your job well. I know, I think you're friends with PJ Pereira. He was on the show not too long ago. And we talked about a similar topic with the Coca-Cola spot. Yes. And that was an AI-generated spot, maybe a little bit before its time. And I think that classic holiday iconic— you know, moment— got a lot of backlash too. Like, why is Coca-Cola doing AI?

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And he said, you know what, that was one of the highest performing Coca-Cola ads of all time, and I think that's absolutely remarkable. And I love kind of your take on that as well. Where are you guys on your AI journey, just overall? Or is that something you're adopting and using frequently? We are, I would say, kind of AI forward. I love it. So I grew up in digital before launching Richard's Learner. Mm-hmm. Excuse me. And so I've always been interested in innovation. And so. I would say, probably three years ago, I had come back from Cannes, and I spent time with our leadership group. I said, 'Look, AI is going to impact your discipline. No matter what discipline it is. It's your job to figure out how it's going to impact the discipline.

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And how do we get ahead of it? And I said, adoption is not enough because every agency in the world is going to adopt AI. We've got to figure out how to innovate with it. And so we've really committed ourselves to that. We've done some work that has been recognized in the industry.' Um, for he gets us, I don't know if this is accurate, but I feel like I could say we did one of the first AI-generated pieces of communication. Uh, ever and it was just using Mid-Journey in the early days, where a lot of what you would get back from it really wasn't it kind of realistic; it was these more abstract images. And um, and but we created a spot around that.

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Pedro Lerma Full Episode Transcript: How LERMA/ is combating generative AI bias

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We've also done work to really help advance AI as it relates to AI bias. So early on with AI, if you were to type in 'CEO,' what would come back was not a woman. Not a person of color. And so we knew that there was kind of this built-in bias. And so what we did was we created a model. That we shared openly with the world using photographs of some of our employees. We took lots of employees. We took lots of pictures from different angles. We rendered that to create unique features, and it created thousands of unique facial features. That would help generative AI render more multiculturally representative images. And so, it's just— it's a. It's really a part of who we are. We're excited about it.

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Um, you know, deploying it where it makes sense in our client relationships. Wow. That's awesome. All right, last question. Okay. Here we go. I thought we were going to get all the way. Well, you know, I wish we could. I'll have to have you back on. Well. We've got some good ones in here. Let's go with number nine. Okay. That's my favorite number. 

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Pedro Lerma Full Episode Transcript: Why Pedro went back to school and got his degree at 53

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Okay. So after opening a bar and dropping out of college, you recently finished your degree at age 53. Why was that milestone so important to you now? Well, it was kind of a weight that I carried for a long time. I always felt like I had to work twice as hard to be half as smart as the people around me. And I was willing to work.

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Um, But it was just always this dark cloud of insecurity for me. And uh. The way finishing came about was I was asked to speak at a scholarship dinner by the university that I had gone to, Midwestern State University in Wichita Falls, Texas. and I told them I said, look um you need to know that I didn't graduate college and they said, Well, you've done a few things, and so we'd still like to hear your story. And so. in a room full of about 400 people. told my story and, of course, it was a cautionary tale, right? Don't do what I did. um And. It was me being vulnerable. again. a big group of people. That was a Saturday. That next Monday, I got a call.

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or a LinkedIn message, rather, from a professor at Midwestern State University who had attended that dinner. And he said, I heard your story. And if you ever want to complete your degree, I will be happy to help you. And I was moved by that. I thought, if he cared enough, to reach out and I'll respond. And we ended up having a call and he had a couple of other professors on the call. And they were really helpful and encouraging. And so I felt like, if they cared enough to reach out, then I should care enough to finish. For several years, I took a class a semester. Will I continue to build the agency until I finished? And in terms of what it meant to me, I didn't know that it would mean so much to me.

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I tell people it wasn't like I was going to get a raise at work for completing my degree. But when I got that degree in my hands, it was an emotional moment where I came to realize that. The dark cloud was gone. Thank you. And something else. Had replaced that, so you know, this feeling of— not necessarily, you know, confidence as opposed to insecurity. A gratitude. And uh, and it's it's been yeah, it's been really important to me. Wow. Congratulations. Thank you. That's pretty great. What was your degree? What was like the final degree in? It was a bachelor's of applied arts and sciences, which is just kind of a general degree. I love that though. All right. So you've seen the show, you know how it ends.

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Pedro Lerma Full Episode Transcript: Closing remarks

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We love to end with a little of this or that. So our audience can get to know you even more. So it's rapid fire. You just pick the first one that comes to mind. Sound good. Sounds great. All right. Let's go. Okay, electric or acoustic? Electric all day long. A live performance or a studio recording. Live performance. There's nothing. They can replace it. I need to know your favorite live performance. All right, Tex-Mex or barbecue? I would say barbecue. Okay. If you had asked me about real mechs or barbecue, I probably would have said mechs. Oh, okay. Good one. We'll have to look into that. All right, owning a bar or owning an agency? Owning an agency, owning a bar was a lot of fun.

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I learned a lot of things not to do when you own a business, but owning an agency has been much more fulfilling. Thank you. All right, Home Depot or Lowe's? Please. I don't even have to, Angela. Home Depot, of course. I bleed orange. That's right. Loves to. Oh, Pedro, this was so much fun. Thank you so much for joining and just sharing your true, authentic and kind self. What's the best way for our audience to connect with you? LinkedIn is always easy. You can find me there and send me a message. You can go to our agency website, lermaagency. com. Um. We'd love to hear from anybody. About anything, whether it's music, leadership, advertising, or cultural fluency. Unite. Oh, thank you so much. We'll make sure we link to all of that in the show notes as well.

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