The guys at Glue found out this week: a whopping £14.1 million (£5 million upfront). And so begins the new dotcom agency goldrush.
It's a sign of the digital times that, while idlers have spent the past week obsessing about who might buy the media and research giant Aegis, Aegis itself has been waving its wallet at the new-media sector. The Glue deal cements Aegis' strategy of building a leading international digital network through its Isobar brand and takes the company firmly into creative territory.
There will be plenty of analogue die-hards who will, at this point, be thinking such digital manoeuvrings are still irrelevant to their comfy creative or media world. They're wrong. Glue's sale will undoubtedly set in motion a domino chain of similar deals over the next year or so. And a new focus on integrating digital communications solutions into traditional above-the-line creative and media strategies will follow.
With digital advertising nibbling at the heels of radio and leap-frogging cinema in terms of ad share, the balance of power is inching the way of the digital specialists. And, while the overall quality of digital work remains only pimpled with creative highlights, there's no doubt that it is the specialists that are producing the best creative work and setting the new- media creative agenda.
So has Aegis spent its £14.1 million wisely? Glue would certainly have been at the top of many predators' wishlists, but the price tag is a little harder to fathom. Most digital agency balance sheets don't stand up to rigorous scrutiny, margins are generally still well below those of traditional agencies and with so much of the workload simply project-driven, long-term projections of financial health are hard to make.
For all that, though, Glue is definitely one of the better performers. In 2003, it had margins of more than 15 per cent on a turnover of £2.1 million. Though margins dipped to under 13 per cent last year, following investment in new offices and increased headcount, turnover nudged £2.8 million and the agency is projecting revenues of £4 million this year.
Some of the digital independents still look like cottage industries run by amateurs (at the last count, only three out of the top 30 digital agencies managed to keep their staff costs below 50 per cent of overall revenue). But the best digital agencies are hardening their fees, being more selective about the business they pitch for, and honing their management skills.
On 2004 figures, Aegis has paid five times the turnover for Glue - which is on the high side - but ultimately the deal secures Aegis' hold on the digital future. And with Aegis itself in play following the 6 per cent stake taken by Havas' Vincent Bollore last week, shareholders should be rubbing their hands.
Nick Brien's return to the media arena as the global chief executive of Universal McCann caught many by surprise, particularly as he had vigorously denied the move last month.
For starters, Brien's career trajectory has displayed a voracious appetite for breadth of experience and the communications cutting edge. And then the idea of anyone of calibre choosing to join Universal right now is a puzzling one.
So Brien is certainly a coup for Universal - inspirational, visionary and a strong personality: a nice change for the network. But will he find that Universal lives up to his expectations? Only if he is really allowed to realise his ambitions to finally give the brand its own identity separate from the dominance of McCann Erickson.