Dentsu advertising & marketing assignments

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Selected Dentsu advertising

No advertising agency dominates its home market as comprehensively as Dentsu, which controls around 30% of all mass media advertising in Japan and has a staggering portfolio of more than 6,000 clients, managed through a multitude of separate domestic units that allow Dentsu to manage the business of rival companies without conflicts of interest. Staff from different units even travel in separate elevators to avoid compromising the security of competing clients. Creative and media are still handled side-by-side in a way that Western agencies long ago abandoned. Despite the best efforts of its competitors to erode its dominance, Dentsu remains almost twice as big as its closest domestic rival, and offers a vast range of additional services through satellite subsidiaries. The most significant of these are probably sales promotion house Dentsu TEC and interactive agency Cyber Communications (or CCI), but there are many others. Dentsu is one of the world's biggest brokers of sports marketing rights. There are also film and TV casting agencies, companies that specialise in digital music distribution online, animation programming and even film funding and production services. Until recently, Dentsu's influence outside Japan and especially outside Asia was limited to say the least. In 2000, though, the giant began to spread its wings, backing the merger of Leo Burnett and D'Arcy, and then swapping that stake for a sizeable minority stake in the newly expanded Publicis Groupe in a concerted bid to increase its share of Western advertising budgets. That partnership was terminated amicably in 2012, by which time Dentsu had begun to bolster its resources in the West with selective acquisitions. One of its first successes was the purchase of the New York shop McGarryBowen, but that deal was eclipsed in 2013 by the purchase of Aegis Group, parent to the Carat and Vizeum global media networks, giving Dentsu a fully global profile for the first time. It has continued to build its profile with a succession of additional acquisitions. However, since 2018 that widely spread international business has become increasingly unwieldy. Dentsu has also been forced to firefight serious problems at home, most notoriously the stress-induced suicide of an employee, a reflection of what was traditionally an all-consuming work ethic. This prompted the resignation in 2017 of CEO Tadashi Ishii. His successor was Toshihiro Yamamoto. Employment reforms left a big dent in profits in 2018, exacerbated in 2019 by a slowdown in international performance, and more recently the effects of the Covid pandemic. Dentsu was one of the worst hit among the major marketing groups, reporting nine consecutive declines in organic revenues to Q1 2021. However, the rebound since then has been strong, especially in the domestic market. For full year 2021, revenues hit a new high of $8.9bn (Y977bn). After a large loss in 2020, net profits bounced back to $987m. Toshihiro Yamamoto stepped down as CEO at the end of 2021, to be replaced by Hiroshi Igarashi.

Capsule checked 8th December 2020

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Dentsu's quarterly organic growth since 2016
See chart
(subscribers only)

See also:

Dentsu Aegis Network
McGarryBowen
Dentsu Y&R
Dentsu America
Carat
Merkle

Who are the competitors of Dentsu? See Leading Agency Brands Worldwide and Japan

Historical profile information for ConAgra Brands

Recent stories from Adbrands Update:

Adbrands Update 16th May 2022: Dentsu was the last major marketing group to report results for Q1 2022. Though the group claimed a "strong start to the year", organic growth of 9.1% placed Dentsu at the bottom of the rankings behind peer companies. The Japanese business remained solid at 10.0% growth but Dentsu International continues to lag behind, with 8.4% growth overall or 9.2% excluding Russia. Regionally, EMEA and APAC ex Japan are the weakest areas at just 3.3% and 5.2% respectively, offsetting much better performance of 13.4% in the Americas. The US and Canada together hit 14%. Reported net revenues for the period were approx $2.0bn with net profit of $185m. With all results now in, Stagwell delivered the industry's best performance for the quarter with organic growth of 23.6%. Omnicom was the best of the majors at 11.9%, followed by Interpublic at 11.5% and Havas at 11.4%. A little way behind was Publicis (despite its string of account wins) with 10.5%, followed by WPP at 9.5% and then Dentsu with 9.1%.

Adbrands Update 16th Mar 2022: Dentsu joined the exodus from Russia. The Japanese group has been active in that country for more than 25 years through a partnership with local company OKS Group. In a statement it said "We are in the process of transferring ownership of our joint venture in Russia to this local partner who will operate independently moving forward. More than 90% of the business in Russia services local clients. We have not made this decision lightly as we have 1,500 people in Russia who have supported Dentsu and our clients over many years. Our thoughts continue to be with everyone whose lives have been profoundly impacted."

Adbrands Update 10th Mar 2022: With all financial results now in, Dentsu headed the rankings table by organic growth in Q4 at 14.2%, followed by Interpublic at 11.7%. Stagwell comes next at 11.3% followed by WPP at 10.8%, Omnicom at 9.5% and finally Publicis and Havas both at 9.3%. Most observers might wonder how Publicis - given its seemingly endless catalogue of account gains in recent months - has managed to end up with the industry's lowest organic growth metric for this quarter. The answer can only be that Publicis is gaining billings at the cost of organic revenue growth; in other words, by undercutting rival groups in the fees it charges.

Adbrands 14th Feb 2022: Exceptional performance in Dentsu's domestic business powered an impressive set of results for 4Q and FY 2021. Combined organic growth for the final quarter was 14.2% (topping all the other groups to have reported so far). Domestic growth was a stellar 17.3%, compared to 12.1% for Dentsu International (although the latter figure, too, was higher than IPG, OMC and PUB). That brought the full year organic upsurge to 13.1% (17.9% in Japan, 9.7% international). Reported net revenues for the quarter were approx $2.5bn and the full year total hit a new company record of $8.9bn (Y977bn). After a large loss in 2020, net profits bounced back to approx $987m.

Marketer Moves 12th Nov 2021: New CEO at Dentsu Group. See Marketer Moves (members only).

Adbrands Update 12th Nov 2021: Dentsu brought the Q3 reporting season to a close with a strong rebound in performance, led by the main domestic agency. Organic growth for the quarter soared by 27.8%, bettering all rivals (albeit from a very weak position in the prior year). The main Japanese business contributed the bulk of that surge, up by a startling 49.7%. Dentsu International was much weaker at 13.4%. Reported net revenues were approx $2.25bn, of which just over $1.0bn was generated in Japan and the rest from international markets. Dentsu International is still suffering from weak performance in three important markets of Brazil, China and India, all of which are still reporting negative growth for the year to-date. See Dentsu's quarterly organic growth since 2016 (subscribers only).

More about Dentsu from Adbrands Weekly Update


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