Rivals Rubbish Sorrell's Claim That Agency Size Matters

20 October 2003

Sir Martin Sorrell is not averse to ruffling a few feathers, especially those of rivals - his relish being all the greater when big bold headlines are the bonus.

Likely, therefore, his tongue was lodged somewhere between his cheek and his wallet when he told a Goldman Sachs conference in New York last week that scale was all important among international ad agency networks. "The middle ground is a very uncomfortable place to be," he opined.

Sir Martin then produced a long spoon and stirred briskly, averring that Grey Global Group - seventh in AdAge's 2002 world rankings and renowned for its slow and steady approach as well its reliance on similarly judicious client Procter & Gamble - was damaging itself by literally giving its services away.

Sixth-ranked Havas was also aligned in the knight's sights. The French-owned agency group's situation, he pronounced, is remarkably like that of Cordiant, former number nine in the world league before it fell apart at the seams earlier this year enabling WPP to sweep up the pieces.

Neither agency group took Sorrell's verbal drubbing lying down. Speaking to Reuters, Grey chairman/ceo Ed Meyer said he had no quarrels with his bigger brethren but rubbished Sorrell's thinking.

"The view of some of my counterparts that the size of the holding company is the only thing that matters is totally silly. I have no quarrels with the 'megas'. Some will do well and some will explode because they're a management nightmare," Meyer said.

Havas' chief operating officer Bob Schmetterer also came out fighting, telling Reuters that size was not everything. Despite Havas' current management restructuring, it is not reliant on any single client and is not vulnerable, he insisted.

"Sir Martin enjoys saying things in public that are controversial. He is who he is," counter-punched Schmetterer. "But if you listen to the clients of the world - General Motors, Ford, Procter & Gamble - every one of them is saying it is not about advertising but communication. Size is irrelevant to that."

Schmetterer'a opinion was supported by Goldman Sachs' Global Ad Survey 2003 published earlier this month.

Multinational advertisers, reported Goldman, are less interested in global reach and access to a full range of marketing services than in good old-fashioned creativity. Nearly eighty per cent of marketers said that creative reputation and performance was critically important. Only a meagre 10% believed international reach was critically important.

Data sourced from: BrandRepublic (UK); additional content by WARC staff