Former Kinetic worldwide boss Eric Newnham (left) is shaking up the UK out of home buying industry in a way it hasn’t seen for years: now leading UK media independent the7stars is set to join the rush to Newnham’s new company Talon.
Aegis’s Posterscope and WPP’s Kinetic have carved up the UK industry between them for the past decade with about 40 per cent of the £1bn market each, Interpublic’s IPM has ten per cent or less.
The giant Omnicom Media Group (with about £150m of billings) has already decamped for Talon and Walker Media and Havas Media (formerly MPG) are set to follow. With the7stars and this lot Newnham’s Talon would displace Posterscope and take second place in the market behind his old employer Kinetic, a startling development that would certainly be noticed at WPP HQ in Farm Street, Mayfair.
WPP boss Sir Martin Sorrell enforces the strictest of three-line whips on all his various agencies, insisting they use in-house companies like Kinetic for outdoor, Hogarth for pre-press origination and Farm for TV post-production. But Kinetic also handles a large slug of non-WPP agency business, including the7stars, and there would a big rumble in the London media jungle if any of this started knocking on Talon’s door.
As for Posterscope, its UK boss Annie Rickard (left), Aegis CEO Jerry Buhlmann and maybe even Japanese giant Dentsu (which is currently trying to seal its bid to buy Aegis for £3.2bn – the Chinese are holding it up) this is turning into their worst nightmare.
Out of home media buying (mainly but not exclusively posters) enjoys much higher margins than the rest of the media planning and buying universe. If Posterscope’s billings continue to diminish Dentsu may consider renegotiating aspects of the deal to buy Aegis.