Dentsu cuts back UK operation

In another sign of ad holding company strife, Dentsu is cutting 60 jobs across the UK in what it says is a restructure to better serve clients. Dentsu says: “Our clients’ needs and ways of engaging with partners is changing and, in response, we are further evolving our business to be more adaptive and more effective in how we innovate and deliver outcomes to service their needs, both for now and what’s next.”

That may be the case, and Dentsu is pursuing a ‘One Dentsu’ policy globally but it is also busily cutting costs including staff and expenses as it grapples with negative organic growth. Most of the ad holding companies bounced back from the pandemic with buoyant numbers but that has well and truly ended with the notable exception of the gravity-defying Publicis.

Dentsu has dispensed with Dentsu International, its operating company outside Japan and the Far East, and International’s highly-paid leader Wendy Clark. It’s hard to see how it can really compete with its Western-based rivals in their home markets, especially the US, although it still has strengths in media buying and performance marketing agency Merkle.

At some stage the ad holding companies will either need to find renewed growth from somewhere – possibly acquisitions as Publicis has done with consultancy Sapient and data business Epsilon – or retrench. Dentsu seems to have embarked on the latter already.

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