OPINION: Time ripe for Asian marcoms chains to emerge

Gone are the days when independently owned, Asian-based networks like Ball held their own against the global giants. And many argue that those days will never come again. According to conventional wisdom, big clients like to dance with partners who have the same size feet. Thus, global accounts are globally aligned and will forever remain so. But what about newly emerging Asian brands? Where will they shop for their marcom services?

And how will they integrate them?

If global alignments put all the big conglomerate-owned agencies, PR companies and media specialists "off limits", does that mean emerging Asian brands will have to buy their marcom services on a piecemeal, market-by-market basis? Are they fated to be the second class citizens of marcoms?

By no means. For while the big conglomerates get bigger (and agency brands get fewer), there are plenty of thirsty young Turks in those conglomerates - young men and women who have earned their stripes in a smorgasbord of disciplines - who yearn to step out and pursue their own destinies. For inspiration, they need look no further than the charismatic enfant terrible of Australian marketing communications, John Singleton. When O&M became a basket case in Australia, Singo stepped in. Presently, his listed STW Communications Group owns 66.7 per cent of Singleton O&M, which is now Australia's most profitable agency. (WPP owns the other 33.3 per cent.)

Now, STW has identified a significant gap in the Aussie marcom industry: an agency with billings of A$200 to $300 million (US$147 to $220 million).

So it has set out to create one - not organically, but by acquisition.

To that end, it has lifted its shareholding in Sydney agency Fame from a third to 70 per cent. Fame, which bills $60 million, is now rumoured to be in talks with three other locally-owned shops. (Names being bandied about include such creative legends as Brown Melhuish Fishlock and John Bevins.) Meanwhile STW is buying a 49 per cent share in Perth's second biggest agency The Brand Agency.

Interestingly, especially in light of today's Asian marcom landscape, Singleton's first ad agency - SPASM - pioneered the concept of a communications supermarket three decades before such thinking was fashionable. Today, an independent Asian marcom supermarket would best be defined as one that combined a creative agency, a media specialist, a design house, a PR firm, and a research company with specialty online, events, sports and guerrilla marketing units. It's an ideal business model to attract emerging Asian brand builders.

But establishing such a conglomerate would not be a doddle. Take another Aussie case - marketing services group Issues & Images, which embraces design, merchandising, field marketing, and Melbourne hotshop agency Badjar.

Started in November 1998, I&I declared it would achieve annual revenue of $100 million by 2003. This year's revenue is $36.2 million. In January I&I bid for Australia's biggest ad agency, George Patterson, and its subsidiaries including the creatively famous Campaign Palace. Nevertheless, in the Asian context, the time is ripe for at least one independent, homegrown marcom conglomerate to emerge. One reasonable scenario would be for STW to spearhead it, by forming alliances with Asian partners. Singleton has what it takes to make such a homegrown conglomerate both possible and profitable. Besides which, Australia is a small market and Singo could do worse than follow in the footsteps of two Aussie predecessors to Asia, Ian Batey and Michael Ball.