SUPPLEMENT: TOP EUROPEAN AGENCIES; Independent agency networks

The benefits of having a network appear to stem less from using it to get on to pitch-lists than being able to respond to a client’s need for regional representation, David Reed says

The benefits of having a network appear to stem less from using it to

get on to pitch-lists than being able to respond to a client’s need

for regional representation, David Reed says

When is a network not a network? The question springs to mind when

considering the fate of CDP Europe. Last year’s table topper, there is

no sign of it in 1996, even though the individual agencies involved

still appear to be operating. What seems to have disappeared is any co-

ordination of them at a regional level - the last chairman of CDP Europe

is reported to have returned to Japan, while enquiries about its current

status were met with a response best described as thin-lipped.

This has allowed Worldwide Partners Inc (formerly Affiliated Advertising

Agencies International, or 3AI) to slip into the top spot with billings

up dollars 30 million to dollars 464 million. The ‘rebranding exercise’,

as Tim Coton, director of business development at Arc Advertising, puts

it, reflects a new-found vision of what makes independent agency

networks matter to clients. ‘We market ourselves less as a network than

as individual European agencies using a network,’ he says.

The importance of strong agencies coming together out of mutual interest

is a key distinction between these networks and the business-driven

multinationals. However, it does often lead to networks where two or

three major players dominate a handful of smaller concerns (Alto is the

exception to this rule).

Coton believes that the benefits of having a network stem less from

using it to get on pitch-lists than from being able to respond to client

demands for regional representation if they arise. ‘If a European

opportunity comes up, we are in a position to pitch for it

intelligently, not scratching our heads and doing deals like M&C Saatchi

with Publicis,’ he says. ‘I don’t think being in Europe per se has a

particular advantage.’

It is a point of view that Patrick Walhain, regional director of IFAA

Europe and associate director of the Dassas Group, would no doubt agree

with. His network has just won the British Airways mileage programme

account in central Europe in a pitch against M&C Saatchi/Publicis. A

decision on the Nordic account, pitched against the same competitor, is


Central Europe will be led from Switzerland and will run across Austria,

Russia and Hungary. ‘We would not have been on that pitch-list without

our agencies in those countries,’ Walhain says. IFAA has also just

picked up the dollars 8 million Case construction equipment account in a

pitch against WPP’s third-string network, Conquest. With press work due

to break in the UK, Germany and France, this was an example of getting

an introduction to a pan-European account from another agency in the

network, in this case, IFAA’s American shop.

Walhain points out that independent networks do not just wait for good

local agencies to become established before signing them up, sometimes

they can help to develop talent as well. ‘In Hungary, I was in contact

with Mahir, which was quite a big, state-owned advertising agency. It

did a lot of things like exhibitions and poster contracting, but little

advertising. There was one very clever woman there who said she may

decide to leave and form her own agency. I said we would be involved,’

he recalls.

The Hungarian agency is 25 per cent owned by Dassas and has picked up

the Ikea account in the country. If similar opportunities were to arise

in the Czech Republic and Poland, Walhain says BA is ready to follow the

network into those territories.

Completing coverage of even the major European countries takes time, as

John Oldfield, managing director of the Charles Walls Group and

administrator of Integra, can confirm. Formed just over a year ago

around a US, UK and Swiss trio which broke away from the Map

International network, Integra has just completed a partnership deal

with Gellier and Associates in France and is still looking for a Spanish

agency. With most of the major European countries in place, the network

will begin to promote itself properly in October.

Oldfield says that the reason for Integra’s careful start has been the

selection process it follows when choosing partner agencies. ‘There is a

list of criteria they have to pass: financial stability, two or three

years’ accounts, the resources available, technology employed, their

ability to run an ad campaign, and ancillary services,’ he says.

Not surprisingly, there are few independent agencies meeting these

criteria that are not already part of a network, and even some of those

that aren’t do not want to go through the process. ‘In Italy, we had

seven listed, visited three and chose one. In France, we reviewed 15 to

20 agencies, offered it to two, who both turned us down,’ Oldfield says.

Expanding the network is not a priority for all of those in the table.

Leslie Butterfield, chairman and managing director of Butterfield Day

Devito Hockney and president of Elan, says: ‘We have always tried to

stick to the six countries we started with, because those are the key

markets in Europe. Nothing, as yet, has been important enough for us

to expand.’

Elan has spent most of the last year working on its major pan-European

through-the-line account win, Kimberly-Clark. Through its German agency,

Buhler Flettner and Partner, it has also picked up Kurver household

goods in three countries, while the UK agency also supported Buhler

Flettner on a pitch to Clerical Medical. Butterfield says that, even if

opportunities were to arise in eastern or central Europe, ‘the

administrative agreement doesn’t allow members from non-EU countries’.

This raises an interesting distinction between the independent agency

networks. Half of them are founded on European Economic Interest Group

frameworks, which establish a holding company with a common marketing

fund. This does limit their coverage to the 15 countries within the EU,

preventing them from taking advantage of other growing markets. But

Oldfield believes that, ‘there is a lot to do in western Europe,’ and

that many of the opportunities in the East are over-stated.

Even longer-established networks have spent the last year keeping their

coverage in place, just as pan-European business has started to become

more evident. International Network had to replace its partner in France

following the purchase by Publicis of Hautefeuille Collette. ‘Les

Ateliers ABC is a very powerful independent agency which we are

delighted has joined - it is a very positive boost,’ Grahame Senior,

chief executive of Senior King and president of IN, says. ‘We have also

taken on an agency in Austria, Reichl and Partner, which is very

strong.’ Senior notes that this gives IN a good connection to eastern

Europe, since Linz and Vienna are both gateway cities, although he is

keen to sign up an agency in Turkey.

Not every network has been active over the last year. Hugh Burkitt,

chairman of Burkitt Edwards Martin and the Alto network, describes the

year for Alto simply as ‘quiet’. Independent Creative Partners reports

that while the network did not pitch for any business as a whole, it has

operated well in providing access to market information to its members.

Some of these have experienced tremendous domestic growth, especially

Jung von Matt and Jean and Montmarin.

The complexities of the EEIG structure mean there is often a two-year

gap between inception of a network and its coming to fruition. But what

is apparent is that the rationale for mutual interest groups of

independent agencies is coming to the fore.

Instead of seeing Europe as a theoretical opportunity, the accounts are

there to be won.

Media Rises up the Agenda

If interest in developing independent agency networks reached its peak

in 1992, the focus of attention for the past few years has been on

regional media networks. The impact of the Media Network, MediaCom or

Mediapolis has been to put pressure on small agencies’ ability to

deliver full-service cross-border campaigns.

One solution is simply to align with one of the independent media

groups, such as Carat or CIA Medianetwork. However, a number of network

heads suggest this removes the very flexibility that is a key selling

point of their set-up. There may also be a mismatch between the

strengths of the agency and media network in each country.

John Oldfield, administrator of Integra, says pan-European media can be

handled very well out of London alone: ‘In the UK, the situation is

unique - there are more international media houses here than anywhere

else in Europe.’

Integra has handled media for SCM Chemical across Europe in this way,

even though its advertising runs in trade and technical press, which is

less globalised than consumer.

But despite the rise of the media specialist there, Grahame Senior,

president of IN, does not believe their buying is any more efficient

than an independent agency’s.

‘When we look at doing a Europe-wide campaign, for example, for a US

state, and we look at the costs we can achieve through buying country

by-country, we can get a better position,’ he says.

In the absence of a parallel media network, agencies may have no other

choice than to work out solutions for clients individually. According to

Patrick Walhain, regional director of IFAA Europe, the differing nature

of media in each country may make media centralisation a vain hope: ‘A

few years ago, we tried to put together the resources we were using

locally to provide a global service. Now, on each project, we have one

agency as the leader and its media people manage all the others in the