Claire Beale on advertising
With Bolloré's sabre-rattling, the status quo looks shakier than ever
Monday 02 October 2006
Advertising might be a business full of colourful creative characters, but it's the industry's top dogs who often provide the most sport.
There are few adland pursuits as entertaining as watching the big stags locking horns. Not just because in the intensely competitive global ad business, rivalry is fierce. But also because such deadly ambition is often tinged with a cocky mischievousness that can make the rivalry seem like an amusing exercise in corporate willy-waving.
The latest gauntlet has come down from Vincent Bolloré, a man whose bank balance knows no bounds. Bolloré runs the faltering French advertising group Havas. With Havas just unveiling less-than-glittering profits, you might think Bolloré has more important things on his mind than yanking the chain of a rival.
Not so. In a cunning PR offensive that helped distract observers from the nub of the Havas results (profits down 38 per cent, with operating margins down to 7.7 per cent from 10.8 per cent), Bolloré last week decided to stir things up over at rival Aegis.
Bolloré wants representation on the Aegis board, which is not as impertinent as it might appear. Bolloré is, in fact, a pretty significant shareholder in Aegis (he owns 29 per cent). But Aegis argues that as the manager of a rival communications group, Bolloré cannot be privy to sensitive commercial information. After all, this is not a business of gentlemanly discretion.
Bolloré has been shunned by Aegis once before. But, in the spirit of the sport, he is undeterred and returned last week for round two. In a letter to Aegis, he requested another meeting with shareholders to make his case. And so Aegis must now call an EGM and boss Robert Lerwill must again go in to battle for the support of his board against Bolloré. In typically needling style, Bolloré described his interest in Aegis as "a long love affair", which will have got some Aegis shareholders frothing.
You can imagine how distracting all this is for Aegis and how much Bolloré must enjoy watching them squirm. And then, in the wings, WPP's Sir Martin Sorrell will be watching and no doubt savouring the spectacle. Sorrell and Bolloré talk, and are even said to have hatched a plan, should Bolloré make a full bid for Aegis, which would see WPP swoop on its Synovate market research division. And if Sorrell can throw Aegis into a spin with a bit of spin of his own, he will.
As an independent media and market research group, Aegis is an anomaly among the marketing services holding companies and, with last week's £400m General Motors media coup under its belt, an attractive target. Lerwill says his priority (beyond the usual "doing our best for our clients" stuff) is maximising shareholder value. It may well be that selling up is the best way to achieve that.
But the Aegis/Bolloré clash is simply the latest move in the dance of the adland CEOs that will inevitably see the curtain fall on the current advertising world order. Whether French companies Publicis and Havas will ally, whether Havas will snare Aegis (my money's on both of these), whether WPP will make a counter bid, whether Interpublic Group will implode, one thing's for sure: the clock is ticking on the status quo. And there's plenty more locking horns to be done before this game's all played out.
* TALKING OF the adland stags, few things get advertising's chattering classes chattering as excitedly as the salaries of its senior proponents. Take the e-mail that was sent in heart-stopping error by a PA, announcing to the world some of the management salaries at one top London agency. Turns out the creative director, a man with a creative turkey or two under his belt, is on a cool £450k. Such largesse is not unique, but it has left observers wondering quite how his department's reputation justifies such generosity.
It's small change, though, to some of the industry's top dogs like Sorrell and Lerwill. According to the latest tally of top salaries by Marketing Services Financial Intelligence, Sir Martin Sorrell is way ahead in the pay stakes. Few would question the man's worth but still, an £859,000 basic and a £1.6m bonus make for eye-watering reading. Poor Robert Lerwill had to make do with a £548,000 basic and £519,000 bonus.
The ad industry is constantly bemoaning its dearth of talent and the difficulty of attracting the best graduates. The IPA could do worse than run a campaign in universities quoting some of these salaries. Best not to use any pics, though.
* THE AD business loves a new consumer phenomenon that it can use to pep up its PowerPoint presentations and persuade clients that it has its collective finger on the pulse of the nation's obsessions. So all over town "YouTube", "MySpace" and "Second Life" are being artfully-casually dropped into conversations about brand communications strategy.
Not everybody working in advertising actually knows what these things are, of course. There's one creative director of a particularly large ad agency who hasn't even mastered e-mail yet. Actually, there's probably more than one. To a fair proportion of the communications industry, Second Life is literally, metaphorically and every which way another world.
Not so over at Leo Burnett. Following hot on the heels of Adidas, which recently became one of the first global brands to create a presence in the online virtual reality world, Leo Burnett has now set up shop in Second Life with a virtual agency - the Leo Ideas Hub.
The idea is to create a global creative community where creative ideas can be shared and briefs honed. It's a neat alternative to the usual company intranet and gives Burnett the option to leverage any commercial opportunities that might come out of the Second Life economy.
But, much, much more than that, it's a good exercise in public relations. Several ad agencies in town have been scrambling to get their own virtual agency up and running, thereby polishing their cool, cutting-edge credentials. That the otherwise rather grey and unexciting Leo Burnett should beat them to it must be deeply frustrating. The rather cooler Bartle Bogle Hegarty was left trailing in the wake when it unveiled its own Second Life virtual agency a few days later.
The agencies must proceed with extreme caution, though. Like so many community sites on the web, Second Life is still relatively virgin territory for brands, and overt consumerism will be quickly stamped on. So don't expect a new breed of Boss-besuited, Blackberry-wielding avatars quite yet. Meanwhile, suggestions that the Burnett initiative is merely a desperate ploy to escape from the realities of the agency's dire Kensington Village headquarters have been vigorously denied.
BEALE'S BEST IN SHOW
A new campaign for mobile phone company 3 is something to savour... again and again and again. Really, you need to. I mean, what the hell is going on? From musical jellyfish to singing cherries and orgasmic housewives, the 3 œuvre is advertising acid.
So you mostly can't tell what it's all about - so what? This is twisted creative genius at work: logic go hang. And, best of all, the 3 ads hit you right between the eyes while rivals receded into bland sameyness. Actually, this latest - from WCRS - is not quite so intriguingly bizarre as its predecessors, which is a shame. But it's mesmerising and really quite beautiful.
You know it's a 3 ad from the off. There's this boy with an enormous trout pout and a girl with a particularly impressive wrist action, which is put to good use as the pair ping paper-plane notes back and forth across the world's largest lecture theatre with awesome speed and accuracy. It's all lush candy colours and a sort of retro-cool quirkyness. Amid the numbing blandness that characterises mobile phone advertising, 3 is a beacon of brilliance. This time round I even managed to work out what it was trying to sell me (e-mail and MSN messaging). Which helps if you're trying to sell. Before, the 3 ads have been industry darlings but perhaps not customer calls-to-action. Now, with subscriber churn rates at 3 recently running at 50 per cent a year, these ads need to start working. Quick.
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