Dentsu move is a big deal
On a day where Fairfax announced its new structure and Photon’s new boss warned against hubris, it would be easy to overlook what may turn out to be the big story of the month.
That credit goes to the Sydney Morning Herald’s Julian Lee for breaking the news that Dentsu is returning to Australia.
Potentially, that’s a much bigger deal than it may sound.
As Lee reported this morning, the route back to Australia for Dentsu is via key global client Toyota.
Droga 5 has achieved the unenviable record of probably the shortest time ever spent by an agency on Toyota’s roster, and is off again. And the decision will increase nervousness at the other roster agencies of Saatchi & Saatchi, Publicis Mojo and to a lesser extent Oddfellows which focuses on the retail side.
But the bigger story – and the reason why this is important – is how Dentsu goes about setting up in Australia this time round.
The first step will obviously be about setting up a presence to service the foundation client. If the approach is similar to Goodby Silverstein and CommBank – a small local office with most of the work back in the US – then there will be few dramas.
But that’s not Dentsu’s model in most other markets.
Depending where in the world you’ve worked, Dentsu may well be the largest agency you’ve never heard of.
By large, I mean that Dentsu occupies a 48 floor headquarters building, Tokyo’s 11th tallest. I mean that Dentsu is more than 100 years old. And I mean that it has a market share of about 20% in Japan. It’s already got a presence in about 30 countries globally.
And just to make the roster issue look even more interesting, Dentsu owns about 15% of Publicis Groupe, the holding company that owns Saatchi & Saatchi and Mojo.
So if Dentsu gets serious about becoming a player in the Australian market, it can afford to invest for the long term.
If it chooses to do so, Dentsu will be able to shake up the Australian advertising market.
Tim Burrowes
Tim Burrowes founded Mumbrella in 2008. He worked on Mumbrella until 2021. At various points he was editor, content director and editor-at-large.
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Went to the Dentsu offices in Japan. Amazing. It is the host of an advertising museum that sits on the bottom level of their monster of a building.
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Tim, it was a joint exclusive between SMH and CB: http://www.campaignbrief.com/2.....mpany.html
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I think they beat you to publish by about six hours, Lynchy.
Cheers,
Tim – Mumbrella
This will prove significant.
No matter what.
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Tim,
Julian put his story on at 3am on the agreement with CB that we would put ours on at 6am. (We both were aware of the story Friday evening but he needed Monday to get his story together).
As far as the ad industry is concerned (who don’t generally get up at 3am to read SMH online) it was effectively a joint exclusive. Our story had other details which he did not cover and was also on Twitter at 6am, hours before the rest of the trade press got wind of it.
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I saw it on the Herald’s web site not long after midnight.
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Dentsu’s PR arm earned quite a few nominations in the Asia PR Week Awards, so it will be interesting to see if this arm of this business comes to Australia too.
Given the success of a few Aussie PR shops in the APAC PR Week awards last night (I think!),are you planning a roundup report on this Tim?
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Wel, done for knowing about the story on Friday, Lynchy.
As it happens, I saw it on the Herald first, so credited them.
Cheers,
Tim – Mumbrella
Wasn’t AIS Media owned by Dentsu in the late 1990’s? (I think I worked for them in Brisneyland!)
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Not being a journalist, I’m not sure how these things work, but why didn;t you publish it on Friday if you knew about it then Lynchy?
Surely your job is to publish what you know, not wait until its convenient for everybody?
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Please, people. The debate about who broke the story first shows how big a story it is, but let’s not have it hijack the real discussion.
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“We both were aware of the story Friday evening…”
What the…?
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“We both were aware of the story Friday evening…”
What happened to journalism?
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Is this how trade press works? You all agree when to publish something?
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Neither SMH nor CB should get any credit for “breaking” the story. They were both simply handed the story. Should we now congratulate journos for being on the receiving end of a PR strategy?
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This has been a long time in the making. I was in serious talks with Dentsu re selling FNL to them in 2005 – we even did a joint presentation to Toyota Aust. and I spent several days in the Tokyo office with the late David Baker (ex SSB) who had been their ‘man in Oz’ for many years. The stumbling block back then was that Dentsu weren’t prepared to commit (to buying into FNL) without a guaranteed piece of Toyota business – but by the same token, Toyota weren’t going to carve off a chunk of business until Dentsu actually had an office here.
The other thing to note is that as the world’s largest single ad agency, as opposed to Group, Dentsu Japan handles a lot of clients who are with other agencies here … possibly because, until now at least, there hasn’t been a Dentsu option.
Anyone feeling nervous?
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Dentsu owned a slice of Mattingly until 1996.
Graham is right to suggest agencies holding clients that Dentsu have in other markets should be nervous.
They are patient, determined and given the right local people to help them may well create the biggest change this market has seen for a long time.
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Lynchy probably didn’t run the story on Friday because (edited under Mumbrella’s comment moderation policy).
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This is bigger than Ben Hur. New Zealand will likely also be in the frame.
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*looks around for a pie to fling* … feels like such a good fight! Come on guys, just use this as a lesson not to sit on a story for many dozens of hours and *then* try claim the glory… Come onnnnn… Seriously!
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haven’t dentsu and oddfellows had an “informal partnership” since 2008?
from an 08 article (mind the grammar errors) “Dentsu is re-entering the Australian market after a seven-year hiatus through a strategic alliance with the in- tegrated agency Oddfellows. The deal has been described as a ‘loose affiliation’, based on Oddfellows’ relationship with key client Toyota. How- ever,should the collaboration prove fruitful after a “trial pe- riod”, the Japanese giant would consider acquiring the Sydney-based agency, said a Dentsu source”
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Dentsu just pitched (and lost) for the Aus Nintendo business last week (the incumbent retained).
That suggests they’re here to play for keeps.
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If my memory is still working I am sure Dentsu prerviously had their very own office in Sydney in the middle to late eighties.
Sydney management was under the control of David Colley who once Dentsu pulled the pin in Australia Colley continued trading as DCA Advertising.
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and of course remember that Dentsu has a stake (10 or 20%) in the Publicis Groupe.
I think this could well be the most significant new agency launch in Australia for 20 years.
Graham….expect you wish you’d done the deal with them in 05!
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