Is Dentsu about to put all its toothpaste back in the tube?

Taking a look at its go-to-market approach over the past 12 months, Mumbrella's Calum Jaspan asks, is Dentsu about to fully integrate its media and creative services?

Looking back over 2022 at Dentsu, the tide appears to be flowing one way. This was emphasised when Dentsu Media CEO, Sue Squillace’s decision to depart the group was made public on Tuesday. 

It came at an interesting time for Dentsu, with the national group CEO role soon to be vacant and a previously reported search for an agency boss at Carat also underway.

The network housed two of the market’s most dominant media agencies less than a decade ago in Carat and Mitchells. It has since refocused its portfolio, the former now its key agency now, with DentsuX and iProspect continuing to support it from the wings.

Sue Squillace to depart Dentsu

By all accounts though, Carat continues to remain one of the nation’s most powerful outfits, with major clients on its books including Woolworths, Medibank, Alinta Energy, SA Government, Kraft Heinz, and more.

Now, with a PR push across the past nine months, is Dentsu signalling it is about to go one step further and retire its remaining brands, fully integrating its media and creative services?

This period has seen the group double down on its creative and CXM product, with the appointments of Kirsty Muddle as group creative CEODavid Halter as chief strategy officer, and John Riccio joining CXM business Merkle as its new CEO, shortly after adding APAC. Steve Yurisich then joined Riccio as chief growth officer across the ANZ region, and Simon Doukas joined as chief experience officer yesterday. 

The creative business lured across M&C Saatchi head of operations, Yvette Henderson, as new group head of operations, Communicado ECD, Sarah McGregor, The Hallway’s head of strategy, Tim Mottau as strategy partner, reporting in to also recently hired chief strategy officer, David Halter, with former Clemenger BBDO Melbourne CEO, Gayle While also swapping her role as Dentsu Media chief digital officer for the newly created chief client officer at Dentsu Creative. Sophie Lander was also promoted into the Sydney general manager, then shortly after being pried away by Cummins & Partners. 

Despite the many hints and already in-use name, Dentsu then told the advertising world in Cannes that it would be streamlining all of its PR and creative brands into one single operation, Dentsu Creative. 

Global CEO Wendy Clark and Fred Levron said that Dentsu is the only one of the major holding groups not carrying the weight to make its restructure so far possible.

Dentsu has made a big play on its creative proposition

On the media side of the Dentsu outfit, things have been a little quieter. Chief operating officer of Dentsu Media, Daniel Isaac moved to GroupM’s Wavemaker as Melbourne MD, head of out-of-home Emma Hegg returned to oOh!Media, Carat Melbourne head of strategy, Bethanie Blanchard joined Coles Media as national strategy and planning lead, following Dentsu Media veteran, Sam Hegg who left Dentsu Solutions to take on the head of strategy and planning role at the new retail media setup. The pair joined their former boss at Carat, Paul Brooks, who also moved across as general manager from Nine.

This culminated with Squillace’s departure, a highly regarded operator across the industry with experience as CEO of two major media agencies in the market, and a sitting board member of the MFA. There are no doubts potential suitors will be looking in that direction.

With all these key departures, a large portion of the roles still remain vacant.

Incoming, Chris Bower was also appointed Dentsu Solutions CEO in February.

This paints a picture showing that – at least for now – the focus has been placed on Dentsu’s seeming position as a marketing and advertising services company, rather than its media offering.

In a paid piece on trade site Mi-3 on Tuesday, Creative CEO, Kirsty Muddle directly said Dentsu is “putting the toothpaste back in the tube”, getting media and creativity back together on a global scale.

Muddle wrote:

“Since Cannes 2016 there has been the launch of many integrated offers in an effort to put “the toothpaste back in the tube” and put media and creative back together. It has created success for some independents but at a small scale.

In Cannes 2022, Dentsu announced we are doing it at a global scale.

Dentsu has been working towards simplifying and streamlining our business into three spheres covering creative, media and CXM, connected by our data analytics capability.

In June 2022, we went one step further, to move from many brands in our creative pillar around the world to one single, creative brand: Dentsu Creative.

Wherever you are in the world, if you work with Dentsu Creative you will have an agency that has the same strategic approach to creativity and the same delivery capability.

And most importantly, Dentsu Creative has been purpose built to draw from our media and CXM team to deliver horizontal creativity and borderless thinking.”

Speaking on last week’s Mumbrellacast, Sir Martin Sorrell also gave his take on the new Dentsu setup.

“The holding companies have difficulty in integrating, you see Dentsu here talk about Dentsu One, but it’s not one, they continue to exclude other parts of their operation, like Merkle, from it. So it’s half pregnant if you like.”

While Dentsu and Muddle speak about putting the toothpaste back in the tube, as Sorrell points out, will that really be the case as long as the media and creative remain in separate reporting lines?

Sorrell told the Mumbrellacast he is not yet sold on the fully integrated Dentsu

Similarly, while Publicis continues to house separate brands, it operates under a single P&L, with Michael Rebelo the boss locally across all its business.

Dentsu Creative was teased in late 2021 when Muddle was appointed, and the name has been in used since then causing quiet confusion amongst the market as to whether this was an umbrella term or something more. This was then subsequently cleared up. The Dentsu Media name has also been in use for some time, though with no clear proposition being offered to this point, rather just the group housing its three media agencies.

So where does this leave Dentsu Media?

With Squillace leaving on her own accord, it appears the search for a Carat CEO is on hold, at least while the Dentsu Media role remains open.

Dentsu declined to comment when asked about the likelihood of a replacement for all three roles, though it did respond saying “we’re in market and well underway in our search for a new leader of our media business”.

Dentsu also made a point in its press release on Tuesday to bring the status of iProspect CEO, Ollie Rapson’s role into the fold, stating that “in the interim, iProspect will continue to be managed” by him.

This comes after just last year, the performance agency re-launched globally as a digital-led ‘end-to-end’ media agency, with a new brand proposition and capabilities. This came after the group merged Vizium into the brand in 2020, as part of a global group strategy to move forward under fewer, stronger brands.

Further, sources inside Dentsu suggest investment on the media side of the business has not matched the rest in recent memory, with further hints that more consolidation is not out of the equation.

When put to Dentsu, it declined to comment on any potential changes to Rapson’s role, the iProspect setup, or the future of each individual agency.

Taking from its heritage

Dentsu Creative’s new positioning is a heavy play on its Japanese heritage, its leaders told Cannes last month.

Dentsu’s ‘creative superpowers’, drawing from the Japanese heritage

An industry source pointed out that in Japan -Dentsu’s ancestral home – there is no Dentsu Media, no Dentsu Creative, just Dentsu. Could it locally be set to double down on its Japanese roots and bring it all together?

While that suggestion is speculation, tracking Dentsu’s moves lean heavily toward the notion that it is moving away from its media base in Australia, where it has been strong for many years.

Dentsu has not been shy to retire legacy brands before in Australia – think back to one of the market’s most dominant names just ten years ago in Mitchells, and in recent memory, the BWM and Isobar brands were also sunsetted.

The group has been praised, and rightly so for its moves and hires on the creative side, so next surely it looks to provide a clear vision for its media?

While Dentsu again to declined to comment on whether this coming together may be afoot, which appointment comes first for the three seemingly vacant CEO roles will give a heavy hint as to what is next.

Whatever it is, Dentsu Media will need clarity on what it is, and where it stands in order to stave of rival agencies that will certainly be looking at some of its larger clients. It has delivered that with Dentsu Creative, so now, we will wait to see where that leaves Dentsu Media.


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