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Autonomy in Holding Groups?

By: Dwayne W. Waite Jr.

AdLand is going through yet another phase of consolidation. Not to the extreme that was seen about a decade ago, but holding companies are making clear power moves and acquisitions that will position them to be bigger players as the advertising landscape continues to morph. Publicis, Havas, and WPP have been making most of the headlines recently with the buying of mostly digital shops and crowdsourcing-based agencies.

The most recent purchase does not fit that mold. Financial Times reported a short time ago that Bartle Bogle Hegarty (BBH to the rest of us), only a startup in 1982 and now a 1,000 employee powerhouse, has just become fully owned by the Publicis Groupe.

As storied as BBH is, the executive board wanted the deal to have certain guarantees about its "independence." The article brought out how Publicis' access to BBH's board would be limited, and BBH would have the right to opt out of certain pitches it deemed out of scope. It also wanted Publicis to promise that BBH could never be merged with another agency, and its offices around the world would not be forced to move or let go of any practitioners.

Sounds like a good deal, doesn't it?

Independent agencies are having a tough time fighting against the wave of holding company ownership. What's not to love? Especially with the BBH deal, it is starting to look like agencies can have the backing and resources of the holding company and retain their independence. Resources everywhere, and still answering to yourself. We'd want the BBH negotiators on our side.

But will BBH, down the road, truly maintain its independence? What if they go to Publicis with a request of additional resources? Can Publicis demand more involvement and oversight? It owns BBH, so one could imagine that they could. A child can go to his or her parents only so many times before the parent starts asking for some concessions.

The deal was made in such fashion due to the people at BBH and its reputation. But when it comes to the mighty dollar and organizational hierarchy, we're unsure that BBH's legacy will stand by itself for long.

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About the Author

Dwayne W. Waite Jr. is partner and principal at JDW: The Charlotte Agency, a marketing and advertising shop in Charlotte, NC. He enjoys consumer behavior, economics, and football.

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