FOCUS: GLOBAL AGENCY NETWORKS - The global agency networks

<p>The spate of mega mergers within the global advertising industry, </p><p>which began just before the world entered the New Millennium, underlines </p><p>the feeling that 'size does matter', especially now in the New </p><p>Economy. </p><p><BR><BR> </p><p>The extent and scale of the mergers are highlighted by a single fact: </p><p>the top three networks now control more than two-thirds of the worldwide </p><p>market share. </p><p><BR><BR> </p><p>But assuming that merger issues - like restructuring, streamlining and </p><p>so on - have been sorted out, in what direction are these monolithic </p><p>networks heading in terms of further development and competition? </p><p><BR><BR> </p><p>The original aim of the mergers was for networks to consolidate market </p><p>share, have a greater talentpool of resources at their disposal - </p><p>ultimately to reach out for greater market control. </p><p><BR><BR> </p><p>Nevertheless, none of these merged conglomerates has yet proven the </p><p>notion that 'a bigger size translates into bigger business'. From the </p><p>clients' viewpoint, there is doubt that they know or really care how </p><p>many sub-agency brands a network owns. </p><p><BR><BR> </p><p>Account disintegration is happenning more often because of the advent of </p><p>the cyber communications era; an era in which clients are resorting to </p><p>more complicated marketing solutions and from more than one source. </p><p><BR><BR> </p><p>Hence, enter the worldwide agency network offering every discipline </p><p>possible. </p><p><BR><BR> </p><p>But as one agency executive pointed out, the mergers did not necessarily </p><p>result in a long term union as it was not unusual for these </p><p>relationships to end up in 'divorce' because of diverse cultural, </p><p>systemic differences and clashes among top management. </p><p><BR><BR> </p><p>Undoubtedly, financial and logistical factors are the key reasons </p><p>driving both client and agency to work under a bigger and bigger roof </p><p>amid the search for financial and operational synergies. </p><p><BR><BR> </p><p>The globalisation of brands is also causing clients to put their account </p><p>into a roster of agencies with the benefit of easier logistic control </p><p>and standardised communications strategy and execution. </p><p><BR><BR> </p>