Bates bosses are stepping up efforts to tighten control of their
offices across the world and are preparing to expand the Healthcom and
Campaign Palace brands as the network gears up for demerger from its
Cordiant parent.
Often criticised for running an alliance of personal fiefdoms rather
than a genuine network, senior managers are using the demerger as a spur
to replace affiliations with equity arrangements.
Michael Bungey, the Bates worldwide chairman, said this week that he
hoped to complete negotiations with five key Latin American offices,
including Brazil, within six months and with others in Central and
Eastern Europe over the next three years.
He explained: ’The reason we are doing this is to capture more
revenue.
Some of our affiliated agencies have been on at us to do this for some
time but we have never been a cash-rich company and we’ve not had the
money to spend.’
Equity agreements will also be used to fuel the growth of Healthcom,
Bates’s healthcare subsidiary operation with which it aims to carve out
a greater share of the burgeoning market in over-the-counter drugs.
Existing affiliation arrangements with healthcare specialist shops in
Europe will move towards equity deals while start-ups are planned in
Hong Kong and Japan.
Meanwhile, Bungey disclosed that the network was looking at the
possibility of exporting the high creative profile of the Bates-owned
Campaign Palace in Australia by opening offices in the UK and the
US.
Bates chiefs once discussed the possibility of aligning Campaign Palace
with Germany’s Scholz and Friends to form a second-string network. But
Bungey stressed: ’We don’t intend using Campaign Palace as the basis for
a network. Campaign Palace would not necessarily attract global business
but it could recreate a culture that’s been very successful in
Australia.’
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