FORUM: Media experts present their predictions for 1999 - What sort of a year will this be for media specialists? Is there merger fever in the air? Last year, there was plenty of speculation, but short of the launch of a MindShare here and there, there we

If you believe even half of what you hear, 1999 is going to be the year of the global media brand. And about time too, you might think. A handful of the bigger players have been frustratingly close to going the full monty for a good while now. Take the established media specialists.

If you believe even half of what you hear, 1999 is going to be the

year of the global media brand. And about time too, you might think. A

handful of the bigger players have been frustratingly close to going the

full monty for a good while now. Take the established media


For years they’ve had networks but they’re patchy and have usually been

inspired by a 19th-century colonial model - strong in Europe with

scattered outposts in the rest of the world. They certainly weren’t

global in the sense of having any meaningful presence in the US.

Meanwhile, the US holding companies have always held fistfuls of trump

cards but have lacked the motivation or the vision to play them.

Obviously they have unquestioned status in the States and a long history

of managing global full-service agency networks, with all the logistics

and systems expertise this entails. They have merely failed to

understand not only that media is a business but that the media product

needs coherent branding and stewardship on an international basis.

This year, all that will change. The veteran media brands - CIA, Carat,

Zenith - will make more of an impact in the US and will continue to

strengthen other weak links. WPP’s MindShare will start pulling its

weight. Companies in the Leo Burnett and MacManus league will continue

to seek media joint ventures and alliances. And most importantly of all,

big US groups such as Omnicom and Interpublic might get their acts

together. We saw signs of it last year and during 1999 they will move

further towards the development of group media brands on an

international basis.

That’s the theory. As we saw towards the tail-end of last year, some

rather painful nettles remain to be grasped. As Interpublic found out,

internal politics can be pretty ferocious when change like this is in

the air. And then there’s the question of client conflict: how should it

be managed, or can it be adequately managed at all? So, will

consolidation really be the theme of 1999? Will it affect everyone? What

are the big issues facing media specialists this year?

According to Steve King, chief executive of Zenith Media in Europe, the

Middle East and Africa, what was truly different about 1998 was the

increasing number of clients looking to consolidate their media on a

regional basis.

He states: ’In 1998 we had 30 per cent of our regional clients

appointing us in three or more countries. Previously the figure was more

like 5 per cent. The proportion will increase linearly throughout 1999

and beyond.

’When Zenith launched ten years ago in the UK, there was a step change

in the way clients thought about media. Clients will now have the sort

of choice on an international basis that they were presented with

domestically ten years ago. And, as with ten years ago, we are able to

tell a great story about what we can offer. Not everyone has equal

abilities in this sector. This will be a challenge for clients, because

there will inevitably be conflict issues. But in order to take advantage

of media opportunities on a global basis, advertisers must be organised

on an international basis and have an international media network.’

Mark Craze, managing director of Carat, also believes we’ll see more

consolidation. He says: ’By consolidation, I don’t just mean

restructuring within groups. I’m talking about the big players getting

bigger in general.

We believe in scale because it generates resources that can be used to

deliver a demonstrable competitive edge. I think it’s also the case that

those who are already well placed have a clear advantage - it’s always

harder having to play catch-up.’

But Craze agrees that conflict is the potential downside. He adds: ’This

is impossible to predict because each client has a different attitude to

it and obviously they have to look at how each particular situation

impacts on their business. But it will become a more important issue -

as media companies get bigger, there are fewer places for clients to


Everyone is likely to be affected as the stakes rise. You’ll already be

sorted or moving that way; desperately seeking alliances or a possible

target for a panic buy. But will this make for good deals? Possibly,

Mark Cranmer, managing director of Motive Communications, says. ’There

are several alliances - take Optimedia, for instance - where the

constituent groups are arguing publicly. If people think alliances and

mergers will create better products for clients, then it is a legitimate

thing to pursue.

But the major groups must think carefully about their attitude towards

media and clarify the status of media operations within their portfolio

of companies.’

Cranmer believes there is no point in pursuing deals if you are only

doing it to improve your position in the billings league table. The

biggest issue of all, he adds, will be value. ’Media companies should be

focusing on what we deliver to our clients’ businesses. And when we are

able to demonstrate and articulate that, we can start charging the right

price for our services.

’We should look closely at how media integrates with creative and we

should examine the role of auditors. I’m very much for clarity of

thinking but the temptation is always to try to simplify things too

much. Auditors have been adding to the confusion by encouraging clients

to focus on the wrong issues. We should be very concerned about the

quality of the environment that we’re placing clients’ work in.’

Steve Booth, managing partner of Booth Lockett Makin, is not overawed at

the prospect of the big battalions squaring up to each other on a global

stage. ’For those who achieve the scale they are looking for, it will be

interesting to see if they can actually do anything with it,’ he


’21st-century businesses - the Nasdaq stocks - will want something

different from that provided by the old school. Evolving markets such as

telecoms, entertainment and high-tech sectors will be more interested in

gaining real access to emerging media.

The opportunity for medium-sized operators is to structure their

services around future needs rather than trying to ape their bigger,

uglier siblings.’


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