Hakuhodo and DY Media Partners merge in Japan

Hakuhodo and sister company Hakuhodo DY Media Partners, two of Japan’s largest advertising and media-buying agencies, are merging. Announced in late November 2024 and effective April 1, 2025, the integration will create a single entity under Hakuhodo, with a combined workforce of 4,601 employees.

This merger is part of Hakuhodo DY Holdings’ broader strategy, unveiled in June 2024, to transform into a ‘creativity platform’ that better meets the market's rising demand for data-driven, full-funnel marketing. Takeshi Tokugawa, director and senior corporate officer at Hakuhodo, explained to Campaign Asia-Pacific that the move is driven by the need to provide data-led solutions in today's ever-evolving marketing landscape. "In the Japanese market, full-funnel support utilising data and technology has become essential," he said. "With advancements like generative AI, client needs are shifting."

The combined entity will retain the Hakuhodo name and headcount as well as integrate core functions like planning and media support. Hakuhodo assures that no job losses are expected in Japan as a result of the merger. However, the shop announced the shutdown of its Hong Kong office in December 2024, ending a 36-year presence in the market. All staff were terminated with a two-month notice period. Campaign Asia-Pacific cannot confirm a direct correlation between the planned consolidation and the dissolution in Hong Kong, but it stands in contrast with the company's expansion efforts in Taiwan, where a new partnership with data research firm Mabu Data Technology aims to tap into cross-border opportunities and inbound Japanese tourism.

The new Hakuhodo will serve as a central platform for the broader Hakuhodo DY Holdings group. Existing relationships with sister agencies Daiko Advertising and Yomiko Advertising will continue unchanged, including media buying services and confidentiality protocols. "We'll maintain current procurement and media buying functions while exploring opportunities for shared resources," Tokugawa explained.

The merger primarily targets the Japanese market, where traditional media is now increasingly adopting a digital operational model. This demands a data-driven, full-funnel marketing approach, which the integrated Hakuhodo aims to deliver. Tokugawa confirmed the merger's primary focus: "Yes, [the benefits] are primarily aimed at the Japanese market."

So, what will success look like for the new entity? "We aim to…boost our media sales capabilities," Tokugawa stated, adding, "Ultimately, we aim to increase profitability by enhancing our value offering."

Hakuhodo showed growth and profitability in the second-quarter FY2024 results, with billings recorded to $4.99 billion, up 5.4% YoY, led by a surge in internet, TV, and outdoor media billings.