While the merger of Publicis and Omnicom has dominated the news of late, something else emerged that could have a more lasting effect on the advertising business. Sir Martin Sorrell has claimed that his holding company client dedicated “team” concept often is better for servicing clients than having client orchestrated individual agencies from different disciplines. The “team” is comprised of members from agencies within the holding company from different disciplines brought together in a newly formed entity and dedicated to a single client. Here are some of the pros and cons for the concept.
·The team concept avoids the politics of inter-agency ego conflicts.
·In comparison with a group of integrated agencies from the same holding company itavoids inter-agency squabbles over siloed profit margin goals.
·The team is easier for the client to manage because the leader of the team mirrors the interests of the client CMO. And the team is likely to assume the personality
of the client as much as the personalities of the various agencies from which they came.
·The team could be more cost effective since there is one blended overhead rate and profit margin as opposed to many.
·Potentially client agency relationship longevity could be improved since the vested interests of both parties are more closely aligned. While individual members of the team may leave from time to
time, holding company leadership is very involved with client business and relatively stable.
·Clients want best-in-breed specialists for their business and the ability to select agencies they believe qualify. The team is selected from within the holding company mainly by the holding company.
·The personalities of the various agencies within the holding company are likely to fade over time. Agency
personalities are largely responsible for styles of creative thinking that could be lost. Important independent agencies would be excluded.
·In depth resources for each discipline are expensive, especially in today’s data-driven world. The team most likely will have to dip into the resources of existing specialty agencies within the
holding company sometimes standing in line from the outside.
·Some claim that many CMOs do not understand how agencies work behind the scenes. Knowing how they work, create and charge is central to the process and achieving maximum performance with measureable