3 August 2014

Nigeria: Starcom & Publicis - Another Affiliation Gone Awry

With the recent public announcement by Starcom Media, a media buying and planning arm of the Rosabel Leo Burnet group, indicating its readiness to cease being part of the Publicis group, observers contend that this may be another failed relationship between local agency and its foreign counterpart. Olamide Bakare reports.

Until recently, the relationship that existed between Starcom Media, and Publicis, a global advertising agency, could be likened to union between husband and wife. Such union allows each party to bring something to the table with the mind that whatever comes will be mutually beneficial. Apart from that, it is expected that such relationship will last for a long time as it is witnessed in many marriages. But that was not to be as Starcom media recently announced that it was severing its relationship with Publicis group. According to an advertorial placed in a few national dailies recently, the management of the agency has announced its plan to cease being part of the Publicis group.

Part of the advertorial reads: "Starcom media ceases to be part of Publicis group effective from 3rd august, 2014. We affirm to all our clients with whom we have shared ethos, media partners and other key stakeholders that the industry leadership, professionalism and high level integrity that have been our essence for over a decade remain our DNA."

To reassure its stakeholders of its ability to deliver quality services, the management of the agency stated in the advertorial that it was committed in delivering services that meets the yearnings of its clients.

The advertorial further reads: "We have got same talents, better insights and digitally charged to continue to deliver best in class, experience, planning to our clients and prospects."

Despite this announcement, the news did not come to many as a surprise, considering the fact that other notable agencies had toe the same line in the past. Before now, Quest Publicis Advertising, another line agency of the S.O & U Saatchi and Saatchi had dropped its affiliate group thereby transforming to a new name called Quest Advertising. The same thing also happened to Insight Communication.

Until recently, the leading agency in Nigeria was formerly referred to as Insight Grey. Another major affiliation which had its relationship ending on a sour note was Prima Garnet Ogilvy. It would be recalled that last year, this was one of the major crisis that almost shook the industry to its foundation giving the fact that two major stakeholders in the industry were involved. It was said that the owner of Prima garnet, who superintend as the Chairman of Advertising Practitioners Council of Nigeria, APCON, took a step to sever the relationship with its foreign affiliate after a breach of agreement.

However, there are those who share the view that the departure of Starcom may have been connected with the earlier plan of the foreign affiliate, Omnicom Publicis, to merge with WPP. To this set of people, it is believed that Starcom sudden decision was meant to spite its foreign partner who had planned to merge with WPP, which could have created room for Insight, which was already waiting in the wings to pick the affiliation in case the deal sail through.

According to a source, who is a practitioner, but preferred anonymity, the departure of starcom did not come as a surprise to him. He said he knew it would happen based on the fact that if the deal between Omnicom Publicis and WPP had been successful, it would have placed Insight far ahead of others. The source was quoted to have said that: "Starcom was not comfortable with what they did and decided to take it out on them."

Chief Executive Officer of BD Consult, Mr. Tola Bademosi, while commenting on the development, said though he may not have been privy to what led to the media agency parting ways with its affiliate, he expresses the belief that breakdown in communication might be responsible.

"For me, I think affiliation is about clearly understanding the objectives. If it is not clearly mapped out, it could lead to sour relationship at the end of the day. Affiliation for me, require proper understanding. In this case, though I am not aware of the terms and what led to the decision by Starcom, I am sure that it must have been a breakdown in communication between both parties. I think it is total misunderstanding. If it is true that it was as a result of misunderstanding, all they should have done was to sit down and look out on the grey areas with a view to finding a common ground," he said.

Asked if this could mark the beginning of an end to affiliation, Bademosi dismissed such thought saying failure of one does not translate to another.

"It would be absolutely wrong to think that because the partnership between starcom media and its foreign counterpart had collapsed, others would also follow suit. Severing of relationship between the two does not necessarily mean that affiliation will not continue to work for others. We have seen many agencies grow using this platform. It has worked for a number of agencies and will continue to work in as much as those involved feel comfortable with the terms," he said.

Similarly, the newly elected president of the association of advertising agencies of Nigeria, Mr. Kelechi Nwosu, while speaking on the development pointed out that there was nothing strange in agency dropping affiliation, saying issue like this is not only peculiar to the industry but occur in business generally.

"I don't see any big deal in agency parting ways with its foreign affiliate. After all, it is all about business alignment and realignment. Agencies can decide to sever relationship for quite a number of reasons. Aside business, we see people align and realign. For some, it could be at corporate level, for others it could be individual. So, I think, businesses embark on this based on different interests," he stated.

Speaking further on the development, Nwosu, who claimed not to be aware of the details of the transaction, said it was instructive enough that the local agency had informed stakeholders of its preparedness to deliver cutting edge services as it was doing when there was a relationship with its affiliate.

I may not be able to comment since I do not know the details involved but the important thing is that Starcom media has confirmed through the statement placed in form of advertorial in some national newspapers that it could thrive with or without affiliation," he said.

Also, the publisher of a marketing journal in the country, Mr. John Ajayi, said the situation where local agency disengages from their foreign partner may not be in the best interest of the industry, stating that one of the key advantages of being affiliated with a global agency is access to global learning; conferences, networking and cross-border access when servicing clients.

According to him, many agencies had in the past benefited from such influences, which culminated in the elevation of professionalism among practitioners.

Lending his voice to the starcom media decision, he believed that every agency has its reason for entering into any relationship and may terminate such when it deemed fit to do.

Meanwhile, some industry stakeholders believed that the trend may not speak well for the industry, particularly upcoming agencies, who may be looking forward to seeking such partnership in the nearest future.

Chief executive officer of Mediacraft Associates, Mr. John Ehiguese, disagreed, saying that owner of any business has the liberty to take decision that best suits its interest, adding that the case of Starcom cannot hinder other agencies who may be interested in seeking partnership with foreign agencies from doing so.

"I think there is nothing to worry about on what they did. I think it is their private business or affair. For me, they must have their reasons for what they have done. It is not going to have any implication on the industry and those who intend to go into partnership on the nearest future," he reasoned.

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