Ad-agencies TBWA and Ogilvy roll out consulting arms to counter encroachment

19 June 2018

As the consulting world continues its encroachment on traditional creative territories, the international advertising agencies TBWA and Ogilvy have responded in recent weeks by beefing up their strategy lines.

With an ultra-aggressive growth strategy, Accenture Interactive has become largest digital marketing network in the world by revenue in the less than ten years since its launch. Recently, the firm picked up Chinese digital marketing outfit HO Communications to add to its some twenty-odd acquisitions in recent years, and at the same time officially announced its venture into programmatic advertising and media planning and buying.

Scott Tieman, Accenture global lead of programmatic services, said of the move; “We have the ability to leverage Accenture’s global footprint and capabilities to integrate strategy, creative, data, technology, and analytics together to drive superior results – a clear advantage for our clients.” Deloitte Digital’s advertising, marketing and commerce practice head, Scott Mager, said in response; “Not surprised at all…We already deliver the same breadth of services to our clients.”

Deloitte Digital has over 10,000 global employees and raked in around $4 billion last year, making it the fourth largest consolidated network in the world by revenue according to Ad Age data, just ahead of Cognizant Interactive and IBM iX and behind only Accenture, PwC Digital in second, and WPP subsidiary Young & Rubicam in third place as the sole traditional advertising-held marketing and communications player at the pointy end of the list.

Martin Sorrell, CEO of advertising holding giant WPP – which last year according to Reuters posted one of its worst ever in terms of revenue growth – has previously dismissed concerns of consulting firm encroachment. “I don't think that head-to-head on digital, the consultants currently win… You can't buy creativity, you can't buy digital capabilities," Sorrell said. The biggest advertising companies in the world, however, are hitting back by way of a consulting counterpunch – making a play for the business transformation turf.TBWA launches Disruption Consulting in Singapore and JapanThe latest moves in the territorial battle have seen the big name international integrated agencies Ogilvy (WPP) and Omnicom’s TBWA Asia arm roll out souped-up regional consulting lines over the past few weeks. Following its addition in India earlier this year, TWBA has introduced its Disruption Consulting brand to the Singapore and Japanese markets – a business growth and consulting model driven by data and consumer insights – with plans for a wider Asian roll out over the course of the year.

Ian Pearman, president of TBWA\Asia, said; “TBWA has a successful history of helping brands find new market space in terms of product extensions, experience and brand architecture, so it was only natural we bring even more focus and weight to this increasingly valued capability. We’ve also added world class data analytics, media planning and commerce skills to ensure we are leading the way in a time when brands are built from an amalgamation of customer experiences.”

Speaking to The Drum, Pearlman expressed that the intention behind the move was to get ahead of the industry shifts rather than being reactive. “I have heard some agency leaders saying that they haven’t seen the consultancies turn up on pitches yet but I think that is entirely missing the point. Consultancies are getting embedded in brands way before the brands even get to issuing an advertising services RFI. And by changing the system that drives a client's marketing, they are reducing the very need for classic mass consideration advertising.

“They don't need to compete in our market, they are too busy shrinking it,” Pearlman concluded, adding that; “You can track their ambitions by the press releases that we’ve seen from Accenture, Deloitte and EY, each announcement representing another step towards our natural territory. Warren Buffett used the metaphor of sustainable businesses having strong castles and unbreachable moats, and versus the consultancies, agencies need to dig bigger moats. Quickly.”Ogilvy launch Ogilvy Consulting as part of global overhaulMeanwhile, advertising industry stalwart Ogilvy, parented by WWP, has announced a fresh consulting arm under a global structural overhaul and rebranding, or ‘re-founding’, in the words Ogilvy & Mather Worldwide CEO John Seifert. Together with a new logo and the merging of its brands OgilvyOne, Ogilvy & Mather and Ogilvy Public Relations under the one umbrella, the firm’s strategy line OgilvyRED will now be known as Ogilvy Consulting – specialising in digital transformations, innovation, and business growth and design.

Seifert said: “This has been an 18-month journey for our brand and the largest transformation in the history of our agency. To meet the changing needs of our clients, we’re taking a bold step to redefine our company and build a new model for our industry, which we helped to create over 70 years ago.” In preparation for the re-launch, Ogilvy chose the Chinese market to test its unified branding, while the initiative follows earlier efforts by WPP to build up the consulting lines in its other agency holdings.

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Infosys finalises joint venture in Japan with Hitachi and Panasonic

02 April 2019

Infosys has stepped up its presence in Japan through a joint venture with local firms Hitachi, Panasonic and Pasona, with the new company to focus of procurement solutions.

Originally announced in December, Indian IT services and consulting giant Infosys has finalised the formation of a joint venture in Japan with local multinational names Hitachi, Pansonsic and human capital firm Pasona, with Shinichiro Nagagata appointed as chief executive. The new entity – named HiPUS – will provide end-to-end digital procurement solutions for Japanese corporations.

The venture comes as a result of Infosys picking up an 81 percent stake in Hitachi Procurement Service, a fully owned Hitachi subsidiary formed in 2002 which handles indirect materials purchasing functions for the Hitachi Group, with Panasonic and Pasona brought on board for 2 percent each. HiPUS will remain headquartered in Tokyo, and kick off with an initial headcount of 200-plus people.

Described as a coming together of complementary, iconic companies, the move is a strategic effort on behalf of Infosys to enhance its presence in Japan, and follows a similar agreement with state investment firm Temasek made in Singapore last year – where it is focusing on cloud computing, data analytics, AI and automation. The Japanese market, however, has shaped the firm’s latest country push.Infosys finalises joint venture in Japan with Hitachi and Panasonic“Procurement is a big focus area for manufacturing & hi-tech clients which Japan is known for,” said Infosys president Ravi Kumar. “All large corporations in Japan will go through significant procurement spend, and we believe this joint venture will deliver to the promise of transforming their procurement processes using next-generation digital platforms, as we bring together the combined power of deep procurement expertise, technology, global expertise and local skills.”

According to the firms, the complementary mix includes Infosys’ global expertise in procurement processes, consulting, analytics and digital technologies, such as artificial intelligence and robotic process automation, with Hitachi and Panasonic’s knowledge of their procurement functions and local teams and Pasona’s human capital and local business process management (BPM) networks.

In addition to BPM, HiPUS will introduce BPO (business process outsourcing) services to customers in areas such as procurement and purchasing operations, as well as provide training services in procurement and a broad range of further lines in consulting, reverse auctions and other purchasing schemes – with the aim of generating revenues upwards of $3.5 billion in 2021.

“We are delighted to build this new partnership, combining strengths and unlocking potential of Infosys, Panasonic, and Pasona,” said Masashi Murayama, Hitachi’s Chief Procurement Officer. “The procurement functions role is critical to Hitachi’s success, and this partnership will strengthen Hitachi Procurement’s global competitiveness with new operating models, and high quality delivery at speed enabled by digital technologies.”

Related: Infosys appoints heavyweight Mark Livingston as new head of consulting