Japanese advertising operates in another dimension, somewhere where
the 100-year plan is the norm, clients still embrace the commission
system and agencies can work for multiple clients in the same industry.
So the effect of Dentsu's partial flotation planned for later this month
was always going to be interesting. The question is, what events will be
triggered on the international stage when it goes ahead?
It's indicative of the culture of certainty that colours all Dentsu's
decisions that I can still write "when" in that previous sentence. For
even with the shockwaves of 11 September still reverberating around and
the advertising boom of the past few years coming to a shuddering halt,
one can say that Dentsu's IPO will go ahead. As one of the last big,
privately held blue-chip companies in Japan, it has an unassailable
position with a 24 per cent market share and some 3,000 clients. For
such a company, long-term vision is the only vision and a little global
downturn is a mere blip in a long history of blips and recoveries.
But for a healthy company famed for its stability, Dentsu has been
woefully late in boarding the global bandwagon. Elsewhere in the world
global ad agencies (for better or, usually, worse when it comes to
creative standards) are mirroring client companies by pushing ahead with
mergers and integration. WPP buying Young & Rubicam last year,
Interpublic snaffling True North this year ... such moves were typical
of the past ten years in global advertising where most of the top ten
groups were repeatedly involved in mergers and acquisitions activity. In
that same period Japan's only large-scale merger was between its
number-three agency, Asahi Tsushin, and the number seven, Dai-Ichi
Kikaka.
Which isn't to say that Dentsu did not have global ambitions, it just
never managed to transfer its expertise outside Japan. CDP did not match
up to any of the international networks when Dentsu took an initial
stake in it in 1990. Its seven US agency purchases, similarly, remained
imperceptible and were folded into the network of Bcom3 in which Dentsu
purchased an initial stake last year.
And then there's Dentsu Young & Rubicam. Established in 1981, it was
largely unruffled by WPP's takeover of Y&R and, along with Bcom3, it
remains one of the two safe pairs of hands Dentsu can use to place
business in all over the world.
Now, ever mindful that it must protect those 3,000 clients from
marauding global advertising and media networks with a presence in
Japan, Dentsu faces a big decision. Does it use the money from its IPO
to build its relationship with Bcom3? Or does it commit more fully to
the Y&R link and WPP? Funnily enough, as these big decisions in life
often do, it may come down to a question of chemistry between Dentsu's
formidable head, Yutaka Narita, and Bcom3's Roger Haupt or WPP's Sir
Martin Sorrell.
