Jaws dropped when Publicis' chairman, Maurice Levy, decided to axe the 94-year-old D'Arcy network last year. After losing its flagship Mars account, D'Arcy was regarded as the runt of an impressive litter of networks including Saatchi & Saatchi and Publicis. So it was folded into the Leo Burnett network, ending an era of advertising history.
It was the first real signal that being an agency brand with a global network of offices and a parent company with the will and means to invest was no guarantee of survival.
D'Arcy's demise was not simply the result of calculator-waving at the holding company. It was also a reflection of the fact that multinational blue-chip advertisers, who previously clung to the global network proposition, are now increasingly confident about returning to smaller, local advertising solutions. Gone are the days when independent local advertising agencies could hope only for parochial business; the world's biggest brands are in flirtatious mode. Take Coca-Cola, once wedded to the McCann-Erickson network in most markets. Now Coca-Cola Great Britain, for example, has a raft of different styles of advertising from smaller, less corporate operations, on its non-flagship brands. Mother manages Schweppes, Oasis and Dr Pepper; Fanta is with Soul; and Lowe looks after Diet Coke and Sprite. With the exception of Lowe, they are all independent outfits and can probably turn out ads without fuss and, crucially, without having to battle through endless layers of bureaucracy.
After years of mergers and acquisitions on the part of the holding companies in the race to be the biggest company in the history of advertising, certain companies could stand accused of some major oversights. While so much attention was being focused on shareholders, paperwork and endless sessions with a calculator to estimate the true value of stock options, how much were staff being valued or clients being serviced? When Orange had to move out of Lowe and chose the suit-less Mother instead, it was hardly a ringing endorsement of the traditional agency structure. Other moves across the globe caused similar surprise: the German independent Wiegertpirouzwolf handles Ikea in Germany and on the original pitchlist for the account were the other independents Jung von Matt and the Amsterdam hotshop 180.
You can bet Germany's biggest agencies, the local offices of the global networks, will have lusted after the business, but Ikea was looking for something different.
Wanting it all
So what does this tell us about what today's advertisers are looking for? It seems they want it all ways: the security of a big network for the global brands with a generic message, while brands seeking a more distinctive look want that injection of creativity that will generate a buzz, column inches and, crucially, sales. Some advertisers use both networks and boutiques. Yet there appears to be a definite shift towards the smaller shops and networks and a rejection of the weary giants. Clients have welcomed the originality and innovation offered by some of the smaller players as a breath of fresh air. Take Fallon winning the £70 million Sony Europe creative account last year out of Saatchi & Saatchi; and Wieden & Kennedy London picking up the £30 million global creative assignment for Sony's sister brand Aiwa a few months later. It sounds like the perfect set-up for one of the holding companies to approach Sony and offer a deal for both Aiwa and Sony advertising.
And yet advertisers just don't seem that interested in the economies of scale promised by the holding companies as a result of consolidation; too many have had their fingers burnt when the holding company agreed a price with a client that the agencies just couldn't deliver. Small wonder that they prefer the idea of strong advertising ideas executed by the people they met in the pitch. Compare this with the all-too familiar disappointment of clients being fobbed off with junior teams after having been dazzled by the creative creme de la creme at the pitch.
Unsurprisingly, though, it's not necessarily the same story the world over. We asked Campaign correspondents across the globe to find out if now is a good time to launch an independent agency. While the time may be right in the UK, Germany and the US, such a launch would be trickier in Japan where Dentsu, Hakuhodo and Asatsu still maintain a tight hold over the local advertising market.
While Japan recovers from a decade of recession, however, all eyes are on China where the advertising economy has almost doubled in three years.
ZenithOptimedia estimates that adspend there will increase by more than 10 per cent in 2003, although growth in Russia will be more than 40 per cent and in Myanmar, the country formerly known as Burma, it will shoot up by almost 60 per cent.
Gearing up for growth
According to both ZenithOptimedia and Initiative Media, the use of media in these markets differs from what we've become used to as the norm.
Cinema is tipped to be the fastest-growing medium in 2003 and it will take local communications solutions rather than multimarket strategies to recognise these differences.
So the smart money will be on Asia, Eastern Europe and Latin America, whose countries make up the lion's share of the ZenithOptimedia top-20 countries by adspend growth.
But the smartest money of all, of course, is already out there.
THE BIG FOUR AND THEIR SHARE OF GLOBAL MEDIA
Holding Main media Est billings %
company networks (USdollars m) change
2002 2001 2002
Publicis Groupe Starcom; ZenithOptimedia 34,550 32,290 6.8
Interpublic Initiative Media;
Universal McCann 31,880 31,880 -0.3
WPP MindShare; Mediaedge:cia 31,550 30,300 4.1
Omnicom OMD; PHD 22,500 22,090 1.9
Holding Main media 2002 2001 Change
company networks market market market
% share % share %
Publicis Groupe Starcom; ZenithOptimedia 21.87 21.33 0.54
Interpublic Initiative Media;
Universal McCann 20.13 21.06 -0.93
WPP MindShare; Mediaedge:cia 19.97 20.02 -0.05
Omnicom OMD; PHD 14.25 14.59 -0.34
Source: RECMA 2003.
GLOBAL ADSPEND BY SECTOR
Sector adspend % change
USdollars m 2003 (est) (2003 v 2002)
Television 134,431,736 6.1
Press 99,877,517 2.6
Radio 11,502,184 3.8
Outdoor 10,898,486 2.2
Internet 4,293,692 4.1
Cinema 1,003,378 10.6
Total adspend for 2003 (est) 262,006,992
Source: Initiative Media.