Ogilvy & Mather has not only topped Media's annual agency ranking for the second year in a row, the network has also widened the gap with runner-up agencies.
Last year, J.Walter Thompson came a close second, but 12 months on and the hot pursuit appears to be running out of steam as its WPP sibling opened up a five point, or 20 percentage point, lead at the top, compared with seven percentage points in 2002.
Nevertheless, JWT retains second place, although it now has to share that spot with three other agencies - Leo Burnett, Euro RSCG and TBWA.
Euro and TBWA pulled off a coup, vaulting into second place from relatively low positions last year. The jump was particularly impressive for Euro, ranked 17th last year, while TBWA moves up five places from its seventh spot last year. Both were able to leapfrog their rivals because of strong new business wins and effective integrated service capabilities.
BBH also surged up the ranking on the back of new account wins and its award winning work for Levi Strauss.
AT A GLANCE
1. OGILVY & MATHER
Ogilvy has won a substantial list of quality assignments in the last 12 months, underlining its investments in all areas of marketing communications, especially with regards to its integrated arsenal. Impressive performance at all major awards show - especially at Cannes, OneShow, Media's Advertising Awards in addition to consistently taking major trophies at almost all Asian markets - gave Ogilvy a perfect score of 10 in the creative ranking.
Ogilvy's unexpected elevation early this year of its regional ECD Tham Khai Meng as co-chairman on a par with it Asia-Pacific chief Miles Young underlines the network's renewed committment to its product and could well keep the network on top creatively for some time to come.
Euro is one of the smaller agencies in the region, however, it has done surprisingly well in reeling in new business - US$132 million since last August. The agency has first class integrated services throughout the region. Its downside though has been that it has not fared as well as it should have at awards shows.
2= J. WALTER THOMPSON
J. Walter Thompson has been one of the more prolific winners of new business. However, it is behind other agencies in the size of its integrated services.
But, its recent retention of part of the Shell below-the-line business for the region should see improvements in this area. Crucially, its offices are winning recognition - for the second year running, the Taiwan office was name "Taiwan's Best Agency for 2003" in a poll of advertisers by Brain magazine. And signalling a creative resurgence, JWT has also won a large number of awards at creative competitions in individual markets in the region, including the 4As best-of-show Kam Fan award in Hong Kong, however, its performance on the regional and international stage could be better.
2= LEO BURNETT
Leo Burnett has scored impressive wins including CSL Hong Kong, Heineken Taiwan and Benetton India - just over US$73 million since last August.
Its challenge now is to rebuild in Australia following several large retail losses - a recent US$18m Dairy Farmers win is a good start. It has also taken steps to bolster its integrated offering, with the launch of iLeo and interactive acquisitions in Singapore. Burnett has been a major winner of awards shows at the local market level, however, its performance regionally and internationally has let it down.
2= TBWA
TBWA is rapidly shedding its image as the new kid on the block. New business wins of US$41 million since last August underline the point. The Tequila brand continues to grow since its launch in Asia three years ago, delivering CRM, promotions and interactive for a wide range of clients - more than half its revenue is from direct business, proof of its high standards.
The appointment of a creative heavyweight Stephen Ward as Hong Kong chairman should add new firepower to the local office's offering at a time when agencies in the city are suffering and contracting.
6= DENTSU
The industry's equivalent of an 800-pound gorilla, Dentsu is the biggest revenue-earner among all major networks in Asia, however, the majority is generated in its home base of Japan, where it has a massive 30 per cent share of the market. Dentsu's challenge in the face of a domestic market that contracted by about six per cent last year, its second consecutive decline, will be to extend this dominance beyond Japan and Taiwan as well as attract more below-the-line business. There are small signs, given the glacial way business is done in Japan, that this is starting to happen.
The company is investing in its Singapore operations, where Dentsu has added PR to its capabilities arsenal and hired a local advertising veteran to head the agency; the Philippines, Thailand and China. It's shareholding in the Publicis-controlled Bcom3 communications group should also provide Dentsu with new business opportunities overseas.
6= GREY GLOBAL GROUP
Grey has had a large number of below-the-line wins to keep momentum in the last 12 months, but it was the US$30 million Nokia N-Gage win in April that really propelled it up the rankings. The agency has a strong balance of promotions, CRM, interactive and PR competencies throughout the region.
It was its CRM capabilities which helped it to develop a stronger relationship with Volkswagen China. The network now has an extensive CRM operation based in China, which should put it in a stronger position to attract new business looking to do more than simply advertise on TV.
6= MCCANN-ERICKSON
McCann is undoubtedly one of the heavyweights in Asia, underscored by new account wins to the tune of US$125 million and it continues to be a force to be reckoned with, especially in Japan and Korea. Strong integrated capabilities are provided by MRM and Momentum, especially with MRM in Hong Kong, but in most other markets these units are operating from a small base. It also works with Universal McCann to produce timely consumer research data in all markets.
Bates has won major above- and below-the-line assignments in India, Malaysia and Thailand, as well as KFC in Hong Kong, but the losses of Heineken, Kia Korea, and parts of Freisland Southeast Asia has affected its overall result. The network's bright point is its 141 operations, whose focus is on sales promotions and CRM. 141's interactive offering in Singapore and Australia are among the best in the region.
9= BBDO
BBDO has made strong progress with wins of Standard Chartered and this year's massive Pepsi/Miranda China consolidation. However, it needs to continue to grow its China base to remain competitive. Its steadfast focus on 'The Work. The Work. The Work.' has contributed towards the agency winning a steady stream of creative accolades. But the downside has meant that it is in danger of falling behind in integrated services.
9= SAATCHI & SAATCHI
Saatchi & Saatchi's cause was helped when H-P consolidated the lion's share of the regional account with the agency along with continued wins in China. The agency has proved with the Guinness/Adam King campaign that it can deliver through-the-line work, although its focus is on above-the-line advertising. It also continues to score highly at awards contests - in particular, AdFest and local market shows.
12= DY&R
Despite the important regional Caltex win and crucial wins in Japan, the last 12 months have also seen losses of Arawana and Pricerite China, and more SingTel business to Leo Burnett. DY&R is attempting to lift its integrated offering by combining its operation with that of Wundermann, however, this move followed the decline of Wundermann's assignments from IBM, Ericsson and others.
Lowe has been driven up the league through ongoing new business success in its massive Indian operation. A new management team in China has scored some big wins and this will likely drive the agency's momentum over the next 12 months. Its below-the-line offering is patchy - it leads the market in India and Indonesia, however, the same cannot be said for other markets.
However, its new global partnership with Interpublic sister company, Draft, will help drive integrated developments.
14 BBH
BBH is considered a minnow, however, its business performance is first rate - it landed Mercedes Asia and Coca-Cola Singapore, without any account losses. The agency was also a big winner in the awards circuit at all levels. Its campaign for Levi's, which took 'Best of Show' at Media's Advertising Awards in March, helped BBH's profile. But its focus is on getting the best in creative advertising, not in establishing integrated specialisations. Nevertheless, examples such as Levi's Engineered Jeans is clear evidence that the agency can think media-neutral.
15 DDB
DDB has lacked the cohesiveness on a regional basis compared with other new business winners, despite strong offices in Singapore, Hong Kong, Australia and Malaysia continuing to fuel growth. In integrated, Tribal DDB and Rapp Collins perform well in some markets but consistency across the region will be a key goal.
16= M&C SAATCHI
M&C has proven to be one of the dominant agencies in Australia in 2002, with wins of more than US$55 million. The same could not be said of its Asia operations, however. But the wins in Australia should spur growth in Singapore and Hong Kong as well as its new bases in Taipei and Shanghai through knowledge-sharing and management, training and research.
16= PUBLICIS
Publicis generated US$73 million in wins in Australia alone - the most successful agency measured for that market - with wins including Nestle and more Telstra assignments. However, its performance is patchy in other markets. One of its key challenges will be to focus on the development of below-the-line unit Publicis Dialog in Asia to foster through-the-line capabilities.
18 FCB
FCB had extensive local wins in 2002, but the major loss of the Compaq business in all markets removed a great deal of potential revenue. The agency's 'Model of One' retains media and integrated services in-house. However, it has to contend with myriad competition from specialist units of other agencies.
19 BATEY
Having implemented the brave and thoughtful decision to reduce and re-align its largest office in Singapore around a few key clients, it's been a quiet year for Batey in the new business area. The win of the StarHub below-the-line assignment has helped the agency's profile greatly, especially in light of the fact that other agencies are handling large parts of the Singapore Airlines CRM, interactive and promotions assignments.
20 HAKUHODO
The agency is the second-biggest agency in Japan after Dentsu, however, its focus remains on its Japanese clients and this is underlined by its recent move to try to close the gap with Dentsu with a strategic alliance with Daiko and Yomiko. Its biggest challenge will be to make a bigger push at the regional level.
AGENCY RANKINGS 2003 - ASIA-PACIFIC
New Network Integrated 2002
Rnk Agency Business Strength Awards Capa- Total Rank-
Wins bilities ings
1 Ogilvy & Mather 5 7 10 8 30 1
2= Euro 9 5 3 8 25 17
2= J. Walter Thompson 6 8 7 4 25 2
2= Leo Burnett 7 6 7 5 25 3
2= TBWA 8 6 5 6 25 7
6= Dentsu 6 7 5 6 24 14
6= Grey Global Group 7 6 3 8 24 13
6= McCann-Erickson 7 9 2 6 24 5
9= Bates 4 6 6 7 23 8
9= BBDO 7 6 7 3 23 6
9= Saatchi & Saatchi 6 5 9 3 23 4
12= DY&R 3 6 7 6 22 11
12= Lowe 6 6 5 5 22 12
14 BBH 7 2 8 4 21 19
15 DDB 4 5 4 6 19 10
16= M&C Saatchi 7 3 4 4 18 -
16= Publicis 6 5 2 5 18 16
18 FCB 4 5 3 5 17 15
19 Batey 3 3 5 5 16 20
20 Hakuhodo 2 5 2 4 13 18
Source: Media, R3
1) Tied agencies are listed alphabetically
2) Countries covered in the ranking include China. Taiwan, Hong Kong,
India, Thailand, Malaysia, Singapore, the Philippines, Indonesia,
Australia, Japan and Korea
METHODOLOGY
The creative agency ranking is based on four components: new business wins; network strength; awards; and integrated capabilities. The four parts are equally weighted with agencies being given a score out of 10 for each, following an analysis by Media and R3. The overall ranking was obtained by adding up each of the components. The four components which make up the overall ranking are as follows:
- The New Business ranking is based entirely on the cumulative scores since August 2002 on the Media/R3 Business Performance League, a monthly feature in Media. In addition, R3 has sourced Australian new business wins from The Agency Register, Sydney. Final rankings take into account the increment to network strength and not merely the raw revenue generated.
Losses as well as wins are included for all agencies. Agencies which have not participated in the Business Performance League have been evaluated qualitatively.
- The Network Strength ranking is based entirely on the 2001 billings and income reports by the local 4A's, with Media's Business Performance League's results added in to approximate 2002 billings.
- The Awards ranking was compiled by examining the performance of agencies operating in Asia at international, regional and local awards shows. These include Cannes, D&AD, Media's Advertising Awards, AdFest and 4As or equivalent contests at national levels.
- The Integrated Capabilities ranking was a qualitative measure of agencies' overall skills in CRM, interactive, sales promotion and public relations.
In order to compile figures for this component, Media and R3 wrote to each of the regional heads of main agencies' integrated units in the region and talked to clients working with all of the top 20 agencies. The final scores are ranked on Media's and R3's best estimation of agencies' quality in this field. While every agency we surveyed has capabilities in this area, some derive more than 50 per cent of their revenue purely from these below-the-line disciplines. So, for the first time, Media has included this as an important stand-alone criteria when assessing overall agency strength.