This article first appeared on the issue 294 of the MARKETING Weekender
After we ran the story of Accenture’s acquisition of Malaysian full-service agency, Entropia, in a dramatic market-changing move last week, we received a lot of reaction from our readers, especially owner-owned businesses. This week we share some of their thoughts with you:
Srikanth Ramachandran – Group CEO, Moving Walls
“I believe this deal will move the entire industry a notch higher. Marketers will benefit from an integrated service that blends business, creative, media and technology to deliver results. Service providers across media, creative and technology will wake up to collaborate and deliver better value. Most importantly, it will be an inspiration to entrepreneurs, intrapreneurs and wannapreneurs accelerating innovation across the board.”
VK Sailendra – Founder, Visual Retale
“What an inspiration to many entrepreneurs especially within the realm of advertising and media. A dream to drive hyper growth within a relatively short time, where intense passion and focus take the centre stage. Furthermore the ability of the founders to share the cake with the key team is particularly meaningful. I was moved by the fact that 13 of Entropia’s 19 shareholders are in fact employees. How amazing is that?”
Dato Johnny Mun CEO, Oxygen Advertising
“Apologies for being blunt but it reeks of a ‘sell out’. Nothing wrong with wanting to cash out and reap the rewards of your toil over the years. But to camouflage it with a backdrop of all the other back ups and ancillary benefits that come with the acquisition and how it’ll add value to clients, etc., is a bit of a yarn. Why? Cos any agency worth its salt should already have all these in its armoury.
This acquisition reminds me of the big hullabaloo when Sir Martin Sorell and the likes decided to break up the traditional agency model of all-in-1 and have separate entities from each MNC agency group to manage different portions of the biz. It was a grand and novel idea then. Look what happened now. Many – namely the media specialists are sheepishly and quietly reverting to the old model – offering creative works, experiential stuff and all that.
In the name of providing a 360° to ‘serve’ their clients it seems.
Or is it plain AVARICE?
And to make matters worse, we are all still fighting for the same pathetic piece of pie. All these plans of grandeur were to encourage clients to up their budgets. But after so many years of hoping, and getting a big fat ZERO! Clients’ budgets never increased and on the contrary most budgets have shrunk. In a large part, owed to the advent of the much vaunted digital age. Clients begin to think that digital is the magic wand going forward and more often than not piss on the time-tested traditional media.
I am an enterpreneur too. And I make no secret that if some interested party wants a footprint in this country and is willing to take a stake in my shop, I’ll gladly listen. But I will not go so far as to boast of what great value the marriage will bring and isn’t it incumbent of us as practitioners to bring this magic to the table now? With or without acquisitions.”
Henry Low – Managing Director, Spectrum Outdoor
“The Entropia-Accenture deal transcends boundaries in the advertising arena and opens up new frontiers. This marks the beginning of another wave of synergy between companies joining forces by capitalising on core competencies in pursuit of higher profit yield.
We have seen rapid industry consolidation taking place in this last 5 years from ride-hailing (Grab & Uber) to now advertising companies.
Out-of-Home media (OOH/DOOH), digital and e-commerce companies are no exemption to performing M&As, e.g. VGI & Plan-B (Thailand), JCDecaux and Ooh!Media (Australia), Gojek and Tokopedia (Indonesia) and the much-talk-about Amazon acquisition of MGM for USD8.45 billion.
As consolidation exercises take place, we can witness them capitalising on their competitive advantages, gaining cost leadership, aiming for bigger market share with a ripple effect in stimulating growth.
Malaysia OOH industry will/may experience another wave of M&As as profit margins have eroded during the Covid-19 pandemic. Costs need to be kept low with the contraction in ad spend.
I congratulate Accenture and Entropia for their long-term commitment to the market.”
Eugene Wong – Group CEO & Executive Director, Sin Chew Media Corporation Berhad
“The marriage of Entropia-Accenture Interactive marks an important milestone in the local communication industry.
The service of multidisciplinary agencies is timely. Business owners, medium size and SMEs in particular, are facing very serious challenges amid the pandemic.
From a publisher’s point of view, we welcome the idea of multidisciplinary agencies. Apart from adding value to clients, it also equips traditional media and creative agencies with more insight. This is particularly relevant when it comes to evaluating solutions provided by news media companies, which have always been evaluated unfairly in tandem with other platforms.
In the interim, large media groups should look into the acquisition of publishing techs, ad techs, data management, AI, and other resources to stay afloat and relevant in the new media landscape.”
Dato Siew Ka Wei, Head of Redberry Media Group
“This deal marks a logical progression for the industry as data becomes centerstage for marketing in the age of digital. We saw the value of such partnerships when we tied up with VGI Global Media Malaysia four years ago in our strategy to become a regional media player. VGI Global Media is part of BTS Group Holdings, a majority shareholder of Bangkok Mass Transit System (BTS), which manages advertising and merchandising on mass transit networks using deep-dive data analysis.”
Peter de Kretser – Founder & CEO, GO Communications
“As legendary singer songwriter Tony Bennet once famously sang, we need to ‘ACCENTUate the Positive’.
Having founded and operated an independent communications business in Malaysia for the last 16 years, one can only look toward Accenture’s acquisition as a tremendous positive.
Positive for the fact that homegrown local Malaysian agencies can match or supersede other possible markets. Positive that communications remains an extremely critical industry in today’s corporate landscape. Positive that Malaysia remains a beacon for communications skillsets very much on the multi-national radar.”