CLOSE-UP: LIVE ISSUE/UNBUNDLING MEDIA; Can shops unbundle media but retain a culture?

By MICHELE MARTIN, Campaign, Friday, 15 December 1995 12:00AM

Michele Martin considers the trend for relaunching media as a new company

Michele Martin considers the trend for relaunching media as a new

company

Last week, McCann-Erickson rebranded its media operation and Lowe

Howard-Spink confirmed it is considering acquiring extra media volume.

As McCanns broadened its media net by relaunching its media department

as a separate company under the Universal McCann banner, Lowes admitted

it was also looking to increase its buying power, possibly through the

‘acquisition of a media independent’.

Unbundling media is not exactly new. The great surprise was Lowes.

Coming from a shop described by Campaign as ‘the ultimate full-service

agency’, it raised wider questions.

Following on from agencies such as Bartle Bogle Hegarty, GGT, BMP DDB

Needham and Collett Dickenson Pearce, which have all addressed the same

issue in recent years, Lowes’ decision prompted the question of whether

a creative shop can unbundle its media and still keep the full-service

culture on which its reputation is based.

In an ideal world, most top executives will tell you that the full-

service model is best. But the need to generate discounts through bulk

buying has forced a change of heart because, as Simon Sherwood, managing

director of BBH, puts it: ‘When you are our size, you have to modify

your belief in recognition of the marketplace.’

Yet recent media tales about medium-sized creative shops have proved

that it is possible to seek media clout without losing finesse. Central

to this has been agencies’ willingness to find solutions that fit

individual needs and cultures. CDP and GGT have set up joint ventures

with CIA in the shape of CDP Media and Media Solutions; Publicis and FCB

have formed a standalone dependant, Optimedia; while BMP remains unique

by keeping its media department - the UK’s third largest buying point -

in-house.

Lowes looks likely to keep its current internal media arrangements,

while using an external venture to give additional TV buying leverage.

It may be this flexibility of approach - rather than pragmatism after

the fact - that has led creatives and account men to sound relatively

chirpy about compromising their agency’s full-service credentials. Jay

Pond-Jones, joint creative director of GGT, says: ‘As far as I’m

concerned, media is in-house and, in the past, when I’ve worked with

media independents, it’s like they were our media partners.’

Dennis Lewis, joint creative director of BBH, adds: ‘The creative

contact with media here is exactly the same as it was before.’

But some agencies still worry about the effect of hiving off media.

Andrew Cracknell, deputy chairman of Ammirati and Puris/Lintas, is

fighting to stop the agency’s international management from stripping

strategic media from individual agencies (Campaign, 17 November).

Agency worries are threefold. First, a powerful media company that acts

as a separate profit centre and is given more clout by media-only

clients could have too much sway over creative issues.

Second, a department that has been physically separated from the rest of

an agency can disrupt the ‘chat across the photocopier’ environment of a

full-service shop.

The final concern is that a separate media entity could draw off profits

and cause friction, especially when the two companies are on different

contracts for the same business.

Nevertheless, many agencies claim to have found solutions. Nick

Horswell, a partner at the media independent, Pattison Horswell Durden,

observes that it always takes time for a dependant to fight a dominant

culture. He says: ‘There have been instances where the creative

department has wanted to go down a route I’ve found very difficult to

justify in cost terms, but where I’ve been put under pressure to comply.

In some of the new dependants, I’ve no reason to think that will

change.’

When it comes to protecting ‘photocopier culture’, many agencies have

got round the problem by siting their dependants near to their main

offices, as in the case of GGT, CDP and Publicis. Where close proximity

is not possible, account teams are structured to compensate for this.

Lewis says: ‘We may only be going 400 yards down the road, but that

distance becomes a barrier, so we’ll have a media person on each brand

group.’

By comparison, concerns about profitability are relatively

insignificant. Although, in theory, media independents could end up

scrapping with agencies for remuneration, most deals are amicable.

Agencies continue to negotiate fees or commission structures in the

usual way, while media companies pick up the 2 to 3 per cent that any

independent would.

If anyone at Lowes is beginning to get cold feet, the best advice they

can glean from shops that have already taken the plunge seems to be:

‘Take no notice.’

Sherwood points out: ‘Motive [BBH’s media dependant] faces two ways.

Inwardly, it’s just like our media department, outwardly, it’s

separate.’

However, he believes strong management control by the main agency, a

media client-list dominated by full-service accounts and personnel who

are grounded in the agency culture can ensure the media culture does not

clash with the main strategy.

Add to this the geographical proximity of a shop to its media dependant,

and Lowes may have less to worry about than the dissenters would have

you believe.

Leader, p29

This article was first published on Campaign