Mini Omnicoms in the making

John Wren may not possess the media profile of some of his rivals, and he makes far fewer headlines, but the Omnicom president and CEO is on a mission to fortify the group's operations in Asia and reinvent the holding company pitch. Wren has set in place an aggressive expansion strategy to arm Omnicom's three networks -- BBDO, DDB and TBWA -- with key marketing services, and transform the agencies into mini holding companies that will each rival the likes of WPP, but still be as small as they are presently perceived. Speaking to Media on a visit to the region, Wren explains that Asia is "terribly important" to Omnicom, particularly given its disproportionately large voice in some of the largest holding company pitches -- HSBC and Samsung -- in recent years. Nothing new here, but what should get Omnicom's competitors taking notice is the "lightning speed" at which Wren hopes to see his grand plan take shape, particularly in markets such as China and India, where Omnicom's share of multinational business is less than 15 per cent -- probably the lowest per cent of any of the world's leading markets -- and where Wren acknowledges competitors may have declared Omnicom dead. "We looked at how important we were to our clients (in Asia) and we made a determination that we weren't 100 per cent in the way of offering all the value that we could in other places. This time next year, our business in China and India will be much greater than (what it is today). You could easily accuse us being something like a sleeping giant when it comes to these marketplaces," says Wren, who, in a show of support to the region, expects to jet over to Asia at least five times next year. Greg Paull, principal of R3, believes some Omnicom agencies have made good progress in China in the last 12 months; however, "they came from a long way back". The challenge in India, he adds, is that Omnicom agencies have minority relationships with very local agencies, which "may not be suited to help them grow multinational accounts". Charged with transforming regional networks is Omnicom's Asia-Pacific president and CEO Michael Birkin -- who has worked with Wren for 12 years -- who is in the process of getting components in place in Asia. "Appointing Birkin is an excellent move from Omnicom to direct its most senior talent to be stationed in Asia. Other holding companies may follow suit," says Paull. Birkin's goal is to have the best in class for all three networks and have at least one player that is perceived as a leader in each discipline in the marketplace. "Ten years ago, there were 20 competitors. We are now down to three credible ones and a wounded whale that's floating around in the ocean somewhere. The number of brands embedded in those companies that can service global clients have gone from 30 to nine credible offers," says Wren. "Without spending a dollar on acquisitions, we want to reinvent the definition of what a client wants and even though I don't believe in the fad of going to the holding company, if I can create what people bring to holding company pitches -- the four services -- then Omnicom can compete in those pitches." Wren believes that even as the industry moves forward, clients will increasingly demand CRM- type activities, interactive marketing and retail activation, expertise offered by Omnicom's DAS. And while industry watchers argue that Omnicom could stand to lose out on potential targets as competitors race to pick the best, Wren says his plan is for Omnicom to transport skill sets from other markets such as the US to fill apparent gaps in its networks in Asia. The group is expected to roll out retail distribution and sales promotion services shortly. Meanwhile, PHD should go some way to lift OMD from its fifth place in Asia, behind MindShare, ZenithOptimedia and Universal McCann. The media brand is on the way to Asia in the form of Mediawise, with Mike Cooper, OMD's Asia-Pacific CEO, taking the role of Omnicom Media Group's regional chief. PHD's rollout should give Omnicom's media offer the bulk that it needs to compete against the mammoth Group M. "You need to be big enough to sit at the table, but then what's important is how you plan and how you use creativity for work on behalf of the client to get the most effective reach and most effective planning," says Wren. However, the weakest link is Omnicom's CRM offer. "Proximity got a good start in the marketplace. Rapp Collins failed a couple of times and it will take a bit longer to get to that. We have to make sure that we don't just build three things that look like what the clients want, but we build real quality." But first, Birkin has been racing to fill the glaring gap at the top of two Omnicom networks. BBDO and DDB lost leaders Raymond So and Aaron Lau within weeks of each other. While Chris Thomas will report as head of BBDO, the DDB top seat remains vacant. Wren isn't giving anything away, he says there will first be an internal search for suitable candidates before Omnicom throws its net wider. For now, Omnicom appears to be capping off the year nicely. The group reported an 11 per cent rise in profits in the third quarter, fuelled by new business wins and increased spending from existing clients. Its Q3 net income rose to US$161.7 million from $145.3 million. Worldwide revenue increased by nine per cent to $2.52 billion.