Live Issue: Post acquisition, should the name change?

Post DDB’s acquisition of Mudra Group, the Indian entity was rechristened DDB Mudra Group. However, when Dentsu acquired Aegis Group and Publicis Groupe acquired BBH, they decided to retain their individual identities. A question that arises with each acquisition is the retention of the name of the acquired agency – in what form, and for how long. While the equity of the acquired agency’s name determines whether its identity remains unchanged, more often the home-grown agency’s name is phased out over a period of time. In the case of home-grown agencies like Mohammed Khan’s Enterprise and Ravi Gupta’s Trikaya, even though they were famous names in advertising, they were eventually phased out by their respective acquiring agencies Bates and Grey.

“Typically, in Indian markets, advertising agencies have started as the brain child of two or three creative directors,” says Raghu Viswanath, managing director, Vertebrand. “More often their personal equity has played a major role in establishing the brand name of the agency, rather than making an organisation of some kind. In this scenario, when the agency has to become a little bigger, forget in the context of acquisition but in the context of survival, it is very critical for them to reinvent and rebuild themselves as an organisation.”

Observing that, in most cases, the Indian owners had sold out their stake as they have either decided to move on or there is no second line of leadership, Sridhar Ramanujam, chief executive officer, Integrated Brand-comm, cited the example of RK Swamy BBDO as an agency brand that has managed to retain its identity for a long duration despite the partnership with BBDO. “Earlier, RK Swamy was better known for its account management and client servicing capabilities rather than its creativity. But with BBDO being recognised as a creativity-led agency globally, the agency is also trying to keep the creative flag flying here as well with the latter’s name attached to it,” he noted.

“When a global agency acquires someone in a region, they have a big decision to make and that is to decide on the name – do you use the name of the parent company, or do you leave it without that or do you combine it? Most often, it is better to take the full identity of the company,” observes Jon Cook, president and chief executive officer, VML. However, when his agency recently acquired Qais in Asia, a joint name VML Qais was chosen. Cook adds, “We decided to retain the Qais part of the identity in Singapore, India and South East Asia, as it had a lot of heritage to it.”
In a similar vein, Greg Paull, principal, R3, observes, “Some clients do view it as a ‘best of both worlds’ - a proven global brand meeting up with a strong local player.  Other agency groups are more adamant in the ‘one brand everywhere’ approach.”

Giving a different perspective, Subhash Kamath, managing partner, BBH India, says, “When Mohammed Khan first created Enterprise, it was with a certain attitude. When Ravi Gupta first started Trikaya, it was with a certain point of view and certain work that we created. It is only towards the end of Ravi’s career that he decided to sell to Grey, and for a good 10 years it continued to be known as Trikaya Grey because of the respect Grey had for Trikaya’s equity in the market. Over a period of time, you migrate the equity to the mother brand. Similarly at Bates when we acquired Enterprise and David, we took stock and it was called Bates David Enterprise for a while.”

  

Acquirer

Jon Cook, president and chief executive officer, VML

“I think a lot of global brands have damaged their names globally by putting their names wholly or as part of the agency name, and then not being prepared to support it with infrastructure, culture and live up to the proposition. Having said that, I do believe that  over time, you would be in a position to drop the second/original name because you have added enough value over a period of time.”

  

Independent

Sridhar Ramanujam, chief executive officer, Brand-comm

“I don’t think agencies, who position their clients so well, are really taking efforts to position themselves. In the earlier stages, agency business was dependent on its owners. Whether it is BBDO, DDB or J Walter Thompson or Ogilvy, all of these were strong individuals. To that extent, even Indian agencies like Bobby Sista or RK Swamy, were names in advertising, so the name of the founder has been a good principle to follow in the past. But we do have agencies like Trikaya, Enterprise and Nexus, who have coined brand names.”

  

Consultant

Greg Paull, principal, R3

“Some clients do view it as a ‘best of both worlds’ - a proven global brand meeting up with a strong local player.  Other agency groups are more adamant in the ‘one brand everywhere’ approach. Publicis and TBWA, for example, have been very successful in most markets other than India in aligning acquired companies into a global brand proposition for marketers.  In the end, it comes down to people and talent – can they align under a single umbrella to drive a consistent vision and brand footprint?  Some agency brands do this better than others.”

  

Agency

Subhash Kamath, managing partner, BBH India

“I think some Indian agencies have invested right in creating a brand name for themselves.  Ultimately you have to be clear on what brand you are focussing on for the future, and if there is equity for those existing brands then you retain them.”

  

Consultant

Raghu Viswanath, managing director, Vertebrand

“I believe very few agencies had the ability and the intent to build them into an organisation. What has happened is that agencies have started off as a one-person set up and grown over time, but they haven’t really grown beyond this one-man show. Therefore they haven’t really invested time and money in building it into an organisation, and where they have institutionalised their creative process or knowledge transfer. Branding that goes beyond the founders and as organisations is very critical as organisations give a perception of scale.”