Stewart Shanley, Daiki Lim and Ian Millner
Korean based creative company Cheil Worldwide has acquired a large portion of advertising agency Iris, with the potential for Cheil to increase its investment to own 100 per cent of the business over the next five years.
The investment will not see Iris change its name and follows on from the agency being appointed to work on a number of global brands including Guinness, Diageo and Samsung, which Cheil is the lead global agency for. Iris Worldwide Sydney clients include Shell, Adidas, Xbox, UNICEF and Fiji Airways.
Iris founder and joint CEO Ian Millner told Mumbrella Cheil is a good partner with “good cultural understanding and a good mix of skills and experiences” as they “both have an ambition to change the world order”.
“On the world-stage Iris is still pretty small and in the Aussie market there are some pretty powerful network agencies who are able to leverage the benefits of the network to make them really competitive in the market. That’s generally true right across the world,” Millner said, adding the partnership with Cheil allows them to play more in this space.
“One of the things that got us excited about the Cheil opportunity is, we both have an ambition to change the world order, we both have an ambition to be more competitive, more interesting and do things that very large holding companies that lead the market can’t.”
On working across Cheil clients, Milner said: “With any sort of strategic collaboration like this, it’s appropriate for there to be good levels of working together on clients, business, on talent, on anything that we both consider to be important.”
In February, Milner told Mumbrella during a video hangout that they would never sell to a holding company like WPP, with the agency pitching the new partnership with Cheil as a a “genuine alternative to the traditional holding company model”.
At the time he said: “”We’re really enjoying life at the moment, I feel like we’re getting going now. I can’t ever see us doing anything with WPP or anyone like that, I can’t see that ever.
“We’ve always had external partners. So at the moment we have a shareholder that’s a company called Meredith, which is a US publisher. We did that deal about three years ago and we did it because we knew that content was becoming more and more important to our business and more and more interesting to our clients.
“Learning more around the art and science of content from a content company, we thought that was a good opportunity. They own 20 per cent of the company, they are good partners,” he said.
“I wouldn’t rule out something that’s interesting and value adding like that, that fits with our principles and our values, I wouldn’t rule that out. I would rule out something with WPP.”
The Cheil deal is understood to replace the Meredith holding.
Responding to those comments today, Millner said if a deal had been done with a holding company such as WPP Iris would have been “put in a box”.
“We’d be asked to play a very specific role, we’d be put in a box. This isn’t about being in a box, this is about being true, having a really good operating system to work with and lots of really interesting kinds of people to help us reach parts of the world where clients expect us to be in,” he said.
“You have holding companies that are very much media and advertising driven, WPP is one of the most well known ones. We believe that there is another way, that way is less driven by dominance discipline and much more driven by working more collaboratively and more confidently with clients to create effective work.
“This is an opportunity to create a world-class, global network where there is a family of brands that have different roles and value within the organisation. It’s very much a family of entrepreneurial brands that work in the Cheil platform,” he added.
On how the investment will change Iris, Millner said it would give the agency greater access to markets across Asia.
“Cheil have much more of a serious and credible footprint in some of the markets, particularly across Asia and China particularly. That will be really useful,” he said.
Cheil Worldwide, a company under the Samsung Group, has a limited presence in Australia, and is perhaps best known locally for losing control of two water buffaloes in Sydney suburb Newtown during a commercial shoot for Samsung.
Cheil Worldwide CEO and president Daiki Lim said in a statement: “Our goal was to find the right partner who could match our determination and drive. We’ve watched with awe how Iris has built its global business and we are delighted to have this opportunity to work with their brand. Their membership in the Cheil Worldwide network will bring great value and agility to us and to our clients.
“Together with Iris, we will provide a different level of service that is able to achieve amazing new creativity and offer best-in-class capabilities. This relationship is a key catalyst in our ambition to be the best possible partner to our clients to deliver ‘Ideas That Move’.”
The new partnership will replace the relationship Iris had with US based published Meredith.
Cheil was advised by Results International and Linklaters and Iris was advised by Osborne Clarke and BDO.
Video hangout with Iris founders: