IPG shops plan to pool media might

Interpublic Group is working on plans to pool the negotiating muscle of its three media brands, Initiative Media, Western International Media and Universal McCann, into a single operation that would form the UK’s biggest media negotiation point.

Interpublic Group is working on plans to pool the negotiating

muscle of its three media brands, Initiative Media, Western

International Media and Universal McCann, into a single operation that

would form the UK’s biggest media negotiation point.



Proposals under discussion would combine the three agencies’ billings

into a new volume-based operation negotiating media deals on billings of

almost pounds 700 million. The idea is to centralise the negotiating

power of the three media agencies to drive greater cost efficiencies for

clients.



The plans are part of a global move to bring the IPG media operations

closer together to maximise efficiencies in administrative areas which

don’t pose any threat to client confidentiality or the saliency of the

agencies as distinct brands.



According to Initiative Media’s European regional director and UK chief

executive, Jeffrey Merrihue, the global plan is for the three agencies

’to take advantage of all synergies such as administration, negotiation

and even, possibly, media buying while the brands themselves will remain

separate’.



Merrihue says the plan will only go ahead once clients from all three

agencies are happy with the idea, and stressed that the individual

agencies would maintain their individual market positions. ’We’re

planning the holy grail of media - the ultimate in service exclusivity

in what will be the biggest negotiation point in the UK.’



The strategy is already in place in Eastern Europe and there is some

co-operation in Germany and Scandanavia. The plan now is to roll it out

to other major markets. A single UK negotiation point could be in place

for the 2000 TV negotiation round next summer.



’We hope the UK strategy will be worked out by Christmas,’ Merrihue

said.



Since the global merger of Initiative and Western was announced last

month, the companies have been looking at ways to improve efficiencies

by sharing backroom resource and pooling media negotiations.



By adding Universal to the mix, the planned negotiation company would be

bigger than Zenith Media, the UK’s largest media agency.



Headliner, p20.



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