SPOTLIGHT ON: Agencies as new-media owners - The ’Wild West’ e-commerce environment won’t last forever. Walsh Simmons is one of many to grab some dotcom action, Alasdair Reid says
By ALASDAIR REID, campaignlive.co.uk, Friday, 30 June 2000 12:00AM
Not so long ago, Walsh Simmons was a humble direct marketing agency based in Manchester. Times change. It’s still based in Manchester, but it is no longer quite so humble and it now has a whole handful of branches in cyberspace.
Not so long ago, Walsh Simmons was a humble direct marketing agency
based in Manchester. Times change. It’s still based in Manchester, but
it is no longer quite so humble and it now has a whole handful of
branches in cyberspace.
However, none of its new websites have anything to do with the
old-fashioned marketing services business - Walsh Simmons has been
rapidly reinventing itself as an e-commerce entrepreneur, with sites
flogging everything from insurance and printing services to flights,
hotels and holidays.
It’s not the only service company looking to muscle in on a bit of
front-office business. Only last week, for instance, Static, the digital
design company, did a deal with Canal Plus, the French pay-TV group, to
offer an interactive games service on the CanalSatellite digital
interactive satellite TV platform.
Since the readjustment in e-commerce stocks, most of the online ’gold
rush’ metaphors have been quietly forgotten - but the Wild West
analogies clearly still apply. Where else would you see marketing
services companies effectively becoming media owners?
Isn’t there a huge potential for conflict of interest here? Steve Walsh,
the managing director of Walsh Simmons, doesn’t think so. He says: ’We
get 350,000 people a month going through our websites (they include
LateRooms.com, MiniBreaks.com, EasyCover.com, HolidayDeals.com and
LateSeats. com) so, yes, we are definitely a media owner. But for banner
advertising we use AdPepper. Yes, if we see a financial services company
on there we tend to think about why EasyCover.com, our insurance site,
isn’t there, but the two sides can be kept at arms length.’
Good in theory. But if this sort of thing were happening in more
traditional media there would be an outcry.
There are two potential conflicts of interest here. One is the notion
that companies in a position to offer strategic communications advice
shouldn’t be media owners. The other is a broader point - design
companies could now pitch themselves directly against clients whose
websites they have designed.
’So what?’ many observers say. Greg Turzynski, a managing partner of
Optimedia, argues that the old rules may not apply to new media because
it is more transparent and its effectiveness is easier to measure.
He says: ’The perfection of data and the inherent accountability mean
that the advertiser will immediately know whether a recommendation meets
It all comes down to trust. If a blurring of lines brings that trust
into question, all the data in the world won’t reassure a nervous
Do clients have genuine grounds for worry? And how do online media
owners with a more traditional heritage feel about this?
Hugo Drayton, the managing director of Hollinger Telegraph New Media,
says that this is just a stage the market is going through. ’Everything
is a bit of a free-for-all at the moment but that will change when the
models become clearer and people will go back to what they recognise
they do best.’
Simon Sadie, the director of innovation at Media Planning, agrees, but
he also points out that there is more than a little admiration in the
business for service companies which cross the divide.
On the other hand, there are obvious downsides. He says: ’My feeling is
that the conflicts of interest are unlikely to be about buying and
selling banner advertising. But if I were a client I would worry about
how much revenue is being channelled away from the service side of the
Sadie believes that priorities change when you stop being a service
’For instance, when you are developing a site for a client, the agency
needs to put in a certain level of investment - but when the task is
completed there is a return on that investment. When you’re developing
the site for yourself you need to make the development investment and
then you need resources to market it. Clients might worry that resources
might be channelled away from their projects.’
Might is the word. But that’s not going to stop people experimenting
with what is possible. Walsh says: ’Yes of course the rules are
When you think about it, it is incredible what we are doing, selling the
things that we sell. Only the internet could have made it possible to be
involved in those areas. What other medium could have made it all
This article was first published on campaignlive.co.uk
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