STEVE BOOTH CHIEF EXECUTIVE, ARENA MEDIA
- Is it inevitable that the raw spirit that drives independents is lost in an acquisition takeover?
Of course not. As far as clients are concerned, it's all about performance. For independents, merging with a big agency gives fantastic economies of scale, but it also allows you to combine research tools, technology and new processes. Naturally, though, any merger or acquisition has to be with the right partner at the right time. For many independents struggling in an uncertain economy, the right partner can renew that raw spirit. The challenges are different, but the buzz of creating something new is the same.
- What are the key challenges in absorbing another agency into a larger network?
That depends. If you genuinely become part of a network, then, ultimately, you benefit from scale while maintaining the culture of an independent. If you're working shoulder to shoulder, then the melding of two cultures can be challenging. Duplication is another consideration - will there be job losses, what impact will any instability have on clients and staff? The key is leadership, planning and clarity. You must be able to explain to staff and clients the clear benefits of any merger. What it means for them now, and what's next. The biggest challenge is openness. Clearly, commercially sensitive mergers and acquisitions are necessarily confidential. However, the sooner you can be honest with all stakeholders, the better.
- What do you imagine Dentsu's Aegis takeover will mean for the diversity of the media landscape?
Consolidation is not new. Commercial realities have impacted media agencies, creative shops, broadcasters and publishers for many years. It's a myth to think that perceived might is anti-competitive. Most businesses understand that diversity and breadth are the lifeblood of the industry. In the UK, you might argue that we are super-served. There are big networks, merged agencies and many smart, independent specialists. Of course, most brands also have parent companies and structures above them that don't impact on their day-to-day business. So they still expect diversity, unique approaches, creative thinking and a broad skillset from their partner agencies. Consolidation is an irrelevance if the service is still excellent.
- How big an issue is client conflict when an independent agency or network is absorbed into a large network?
I think this depends on your client relationships. Trust is central to all our partnerships - if this trust is embedded, then most "conflicts" don't become a problem. For some brands, however, it's a deal-breaker. In those cases, you just have to take your lumps and move on. Consolidation creates client conflict only on paper in the main, especially in networks. Very often, you are still working as an independent agency within an umbrella company. In those cases, it shouldn't even be an issue. Plus, for most clients, consolidation is a fact of life and they have faced it outside the agency relationship in their own companies.
- Is it best for media independents to retain individual brand names after a takeover or should its name be associated with the parent network brand?
With a true merger and cross-fertilisation of assets, departments and staff, normally, the larger agency's name prevails, or a new name is found. However, most will keep individual brand names - after all, it's that brand that drew the interest in the first place. In our own case, under Havas, we became Arena BLM, gradually dropping the BLM tag. To this day, however, there are those who still talk about us as BLM. Your name (or part of it) can be reassuring and reinforce the fact that the smaller, merged agency has its own identity and ethos that clients value. You'd never buy a Kraft Creme Egg, would you?
JIM BRIGDEN CHIEF CLIENT AND COMMERCIAL OFFICER, IPROSPECT; FORMER chief EXECUTIVE, I SPY MARKETING
- Is it inevitable that the raw spirit that drives independents is lost in an acquisition takeover?
If you can retain people and clients and keep the hunger that has driven you forward as a team, then absolutely not. By becoming part of iProspect, we are confident that we can achieve much more on a bigger stage than we could have achieved if we were to have remained independent. We are now focused on using that raw spirit to accelerate the growth of iProspect to create a best-of-breed specialist within a network agency framework.
- What are the key challenges in absorbing another agency into a larger network?
I can honestly say that the challenges are reduced by making sure that the fit is right. I Spy spent a lot of time with Rob Horler (chief executive, Aegis Media UK) and Ben Wood (managing director, iProspect) and the wider Aegis team, making sure that our respective businesses fitted well together. IProspect is gaining from the addition of a great team and lots of happy clients, and I Spy has benefited from the greater resources and the collective knowledge of a much bigger, very successful operation. We can now take our clients global and introduce them to offline services as well as a broader range of digital services.
- What do you imagine Dentsu's Aegis takeover will mean for the diversity of the media landscape?
Dentsu has established a reputation for excellence, particularly in the Asia market, while Aegis has a significant presence in Europe. The combined businesses will be able to compete effectively with the likes of WPP, Omnicom, Publicis and Interpublic. With its broad integrated digital expertise, data-driven approach and geographic footprint, it is well-positioned to be the global agency of the future.
- How big an issue is client conflict when an independent agency or network is absorbed into a large network?
It has not been an issue for us. Before the acquisition, we sat down and mapped out our clients and did not identify a single client conflict. It is one of the many aspects that attracted us to iProspect. I Spy and Aegis actually share several clients and our team was working closely with the Aegis teams. Conflict has not been a challenge at all.
- Is it best for media independents to retain individual brand names after a takeover or should its name be associated with the parent network brand?
We made a conscious decision to become iProspect from day one. IProspect is a globally recognised performance agency brand. As part of an integrated agency, we can go out and accelerate the growth in the iProspect business under one management team with one goal.