Strategic clarity trumps scale anyday: Experts on POG's failed merger

Clients & employees not being at the core, lack of a clear vision & strategy emerge as some of the factors that have led to the collapse of the Publicis-Omnicom mega merger, feel industry experts

e4m by Priyanka Mehra
Published: May 12, 2014 8:50 AM  | 3 min read
Strategic clarity trumps scale anyday: Experts on POG's failed merger

Publicis Groupe and Omnicom Group called off their $35 billion merger deal last week, a little over nine months after announcing plans to team up in what was termed as “merger of equals” and the biggest merger of 2013. Publicis Groupe and Omnicom have said that the decision to call off the deal was mutual, following “difficulties in completing the transaction within a reasonable timeframe”.

There have been several reactions to the breakdown of this deal. exchange4media asks some leading advertising honchos what do they think led to the failure of this marriage of ‘two equals’.

Clients and employees were not at the core
“I am not privy to any special information, but I guess the decision was probably a hurried one, for the sake of scale and all issues concerning people and clients that would arise were not thought through in great detail,” opined Sam Balsara, Chairman and Managing Director, Madison World.

Rohit Ohri, Chairman, Dentsu India & CEO, Dentsu Asia Pacific South remarked, “A clear vision and an added value proposition for clients are needed to drive a large merger like this. I think that’s where POG fell short.”

Media leaders across the industry believe that the two critical success factors in a merger are perceived value addition (or lack thereof), as seen by the clients and as seen by the employees. Every other factor comes later.

“A good merger cannot be based on a desire for size, it has to be for client and people,” said Ashish Bhasin, Chairman & CEO - South Asia, Dentsu Aegis Network, while emphasising on the importance of clients and employees being at the centre of all decision making.

Impact on media industry... WPP continues to reign
A merger of this scale undoubtedly brings benefits in terms of enhanced power of scale, which is a precious tool in the media business today. If the Publicis-Omnicom Group (POG) was to use this power for negotiation in consolidated buying, other networks would be impacted as well.

“Both the networks have spent so much in the backend, working towards the merger, in planning and bringing both the networks together. It is also a wasted opportunity to leverage media resources and the strength of scale,” observed Bhasin.

The POG merger had to also overcome the challenge of two different nations and cultures coming together, which is no mean feat. In addition to this, consolidated buying comes with its own set of challenges.

Balsara felt that people will be more careful in future before announcing mergers. He added that WPP continues to reign.

Learnings for the industry
The importance of good strategy in a merger of this scale cannot be undermined, felt Ohri, adding, “The big learning for the industry from this failed merger is that strategic clarity trumps scale anyday.”

Given that mergers are fast becoming a norm, it is vital not to get carried away by the size of the corporations or the size of the deals, feel industry leaders.

Echoing this sentiment, Bhasin said, “In a service industry, clients need to come before chasing size and bottomline.”

Organisations opting for a merger need to start asking what value will it add to the talent and what value will it add to the clients in the long run.

“The major learnings are that irrespective of size, agencies are about people and clients, and if you forget that, you are in trouble. Most other corporations operating in other sectors don’t have this problem,” concluded Balsara.
 

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E4M Our strategy is to target younger audiences through Sports: Rajiv Dubey, Dabur

The Head of Media at Dabur India spoke exclusively to exchange4media on the World Cup, associating with Indian Idol, the company’s digital spending and much more

e4m by e4m Staff
Published: Oct 27, 2023 6:15 PM  | 1 min read
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With quirky campaigns, memes and moment marketing, timed with the ongoing World Cup and particularly the India-Pakistan matches, Dabur India has got considerable consumer attention for its popular brands – Red Paste, Cool King Hair Oil, Chyawanprash, Dabur Vita and the recently launched Bae Fresh Gel toothpaste.

The 140-year-old company is going big on key sporting events, World Television Premiere (WTP) movies and reality shows. It is now gearing up to become the title sponsor of popular talent show ‘Indian Idol’ on Sony TV for the first time, shared Rajiv Dubey, who leads the media strategy at Dabur.

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Swapan Seth's new book 'COOL' is out

The book is a reflection of the author's 'eclectic taste across categories'

e4m by e4m Staff
Published: Oct 27, 2023 6:07 PM  | 1 min read
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Advertising professional and art collector Swapan Seth has announced the launch of his new book COOL. The book is described as "a ready reckoner to the hip and the happening, of the known and the very unknown."

The book is a reflection of the author's "eclectic taste across categories: from boltholes to exotic hideaways."

COOL has been published by Simon & Schuster India and is available on Amazon.

Seth is an ad veteran with a long and illustrious career in the industry. He became the youngest-ever Creative Director at Clarion at age 24. He was VP at 26 at Trikaya Grey. Two years later, he started his agency Equus.

He writes for publications such as The Economic Times, Hindustan Times and India Today. This is his second book and he has previously published THIS IS ALL I HAVE TO SAY.

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Disney Star signs 9 sponsors for Asia Cup PAK

Charged by Thums Up, Nerolac Paint+, Amazon Pay, Jindal Panther, My11Circle, MRF, Samsung Galaxy Z Flip5, Wild Stone and Thums Up come on board

e4m by exchange4media Staff
Published: Aug 26, 2023 11:48 AM  | 1 min read
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e4m Staff Disney Star has signed nine broadcast and digital streaming sponsors for the upcoming Asia Cup.

Charged by Thums Up, Nerolac Paint+, Amazon Pay, Jindal Panther, My11Circle, MRF, Samsung Galaxy Z Flip5, Wild Stone and Thums Up have come on board for the upcoming tournament.
As reported earlier by exchange4media, Disney Star has sought Rs 26 crore for the co-presenting sponsorship on TV and Rs 30 crore for Disney+ Hotstar.

According to industry sources, the associate sponsorship on Star Sports has been priced at Rs 19.66 crore, whereas for the ‘powered by’ sponsorship on Disney+ Hotstar, the broadcaster is seeking Rs 18 crore.

As per the information available with exchange4media, Disney+ Hotstar has three sponsorship tiers-- co-presenting (Rs 30 crore), powered by (Rs 18 crore) and associate sponsorship (Rs 12 crore). The broadcaster is offering an estimated reach of 120-140 million for co-presenting sponsors, 90-100 million for powered by and 60-70 million for associate sponsorship.

A spot buy for 10 seconds has been priced at Rs 25 lakh for the India vs Pakistan matches, while for the non-India matches, the ad rate for 10 second is Rs 2.3 lakh. The India matches plus the final for ODIs has been priced at Rs 17 lakh per 10 seconds.

Asia Cup is scheduled to be held from 30 August, 2023, to September 17, 2023.

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Sorted 360 wins creative & social media mandate of Reliance Mall

The agency will manage offline and online campaigns for Reliance Mall

e4m by exchange4media Staff
Published: Aug 26, 2023 10:54 AM  | 1 min read
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Sorted 360, an integrated creative and social media agency, has won the mandate to providing brand solutions for Reliance Malls across India.

“Sorted 360 is set to enhance Reliance Malls' market presence with their unparalleled creative prowess and strategic thinking,” read a press release.

“Sorted 360's commitment to pushing the boundaries of creative communication aligns perfectly with Reliance Malls' ethos. With a pan-India presence spanning across 19 cities and growing, Reliance Malls has consistently captivated customers by offering an array of Reliance brands and third-party fashion & lifestyle brands. The mall has established an unparalleled connection with its patrons through superior quality, a remarkable value proposition, and an unmatched shopping experience,” it read further.

"We are thrilled to welcome Sorted 360 as our trusted partner in advancing our brand presence across the nation," said the Head of Marketing at Relaice Malls. "Their proven expertise in retail, shopping center management, and innovative creative strategies make them the perfect fit for our vision."

"Partnering with Reliance Malls is a testament to our commitment to shaping extraordinary brand experiences," remarked Prerana Anatharam, Co-founder of Sorted 360. "We are excited to leverage our strategic and creative acumen to further elevate Reliance Malls as the epitome of convenience, choice, and excellence."

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KlugKlug onboards Hemang Mehta as Country Manager for Indias

Mehta was most recently Head of Agency Relationships at Network 18 Media & Investments

e4m by exchange4media Staff
Published: Aug 24, 2023 3:35 PM  | 1 min read
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KlugKlug has appointed Hemang Mehta as its Country Manager for India.

Mehta will play a pivotal role in driving KlugKlug's growth and expansion within the Indian market and be responsible for Sales & GTM Strategy

Prior to that, he has also represented organisations like Exponential (now VDX.tv), India Today Digital and Rediff.com. His expertise spans various domains including digital media sales, mobile marketing, media planning, and buying, social media marketing, and more.

Hemang Mehta expressed his enthusiasm about joining KlugKlug, saying, "I am thrilled to be a part of KlugKlug, a forward-thinking platform that is reshaping the influencer marketing landscape. As much as I look forward to collaborating with the exuberant team at KlugKlug, I am super excited to interact with the brands to deliver powerful data-backed Influencer solutions that will guarantee business outcomes."

Commenting on the appointment, Kalyan Kumar, Co-Founder and CEO of KlugKlug, stated, "We are excited to welcome Hemang Mehta to our team as the Country Manager for India. His extensive experience in digital media sales and marketing will be instrumental in driving our efforts to provide influencer marketing solutions to our clients. We believe Hemang's leadership will be key in scaling our operations and expanding our reach within the Indian market."

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