The future of classic advertising agencies comes under the scanner as the agency network’s decision draws eyebrows and sorrows.
J. Walter Thompson died at the ripe age of 94 in India after its parent company WPP said it would globally merge the legacy agency with sibling creative shop VMLY&R to form a new entity called VML.
Not many know that the goddess was with the legacy agency for most of its life in this country.
Born in 1864 in the United States, the agency – called Hindustan Thompson Associates (HTA) in India - decided to move to its first-ever Indian office in Mumbai’s Fort area in the late 30s after a brief stint in a Taj Mahal Hotel room. A statue of goddess Laxmi stood tall on the new office building's roof. Its name? Laxmi Building.
The goddess comes to you in mysterious ways. If you are mindful enough to sense her presence; she will be most pleased, and may shower good fortune on you — perhaps even reveal herself to you, and invite you to ask her for a boon.
Decades later in 2002, when HTA rebranded to JWT and moved to Peninsula Chambers in Mumbai’s Lower Parel, agency old hand Nisha Sampath says there was a statue of the goddess of wealth at the entrance of the new building.
HTA or JWT had become the biggest advertising agency in the country; from Air India’s Maharaja to Shah Rukh Khan in a Lux ad to Pepsi’s Oye Bubbly to winning India’s first Grand Prix Lions at Cannes, the agency was the ‘IT’ place in advertising for decades.
In 2019, WPP merged it with another network agency Wunderman to create Wunderman Thompson.
The merger raised quite the eyebrows back then. The new announcement that merges Wunderman Thompson into oblivion has caught many unawares.
VML will be the world’s largest creative company, combining brand experience, customer experience and commerce, reads the network’s press note on October 17, 2023.
“If I was a client, I'd put the clause in the agency contract: ‘My team cannot change.’”Santosh Padhi, CCO, Wieden & Kennedy
It is a mark-this-date-on-your-calendar move in advertising because it not only dissolves a nearly 100-year-old J. Walter Thompson, one of the oldest advertising agencies on this planet, but also sounds the loudest gongs heralding the start of a new advertising age – one led by technology and gauged by performance, and not by classic creative advertising thought.
Media is fragmented and the digital domain, as per business strategist and investor Lloyd Mathias, has emerged so large that “it has been able to take under its wing the old legacy agency.” Mathias was the client of JWT when he headed PepsiCo India’s beverages category.
He says what is happening right now is a churn in agency structure and the old-world mother agency which had creative, servicing, and media offerings all built into one is fragmented and you now have specialist agencies in martech, ad tech, social media, and influencer management.
“The age of the specialist is over. The age of the generalist is here with a strong digital and new media skew,” he states.
Sampath who worked at the agency between 2004-08 says the agency laid the foundation of strategic thinking, and that “there is a sense of personal loss.”
She worked on HUL’s Lux (she was part of the campaign starring Shah Rukh Khan) and on, albeit for a short time, Piramal’s Saridon.
Such was the agency’s might, she recollects, that once then Mumbai branch head Tarun Rai had remarked: “I've accepted that we lose people to other agencies because JWT is the happy hunting ground.” Rai retired in 2023 and his last-known designation was executive director, strategic initiatives at Wunderman Thompson APAC.
That classic advertising agencies will find it tough in the face of digital is a point Sampath agrees to and says, “The writing is on the wall.”
She feels the legacy agencies, seeing what happened to Wunderman Thompson, should regroup and figure out ways to keep going and if needed, reinvent themselves.
It is not the first time WPP or any agency holding network has merged two agencies but Santosh Padhi, Wieden & Kennedy India's chief creative officer, believes they do not work 70 to 90% of the time.
Padhi had co-founded Taproot with Agnello Dias before Dentsu India acquired it in 2012.
“For decades, network companies have not learnt from others' mistakes. You don't have to cut yourself to see the blood. You've seen people bleeding in such mergers and acquisitions,” he states.
The creative chief laments that network leaders forget that creative business is an emotional business. “There is great passion and emotions that flow between brands and agencies. When such steps are taken, it is a blow on everybody.”
Of all the people caught off guard by this announcement, it is important to understand the minds of Wunderman Thompson’s clients.
Now, these are clients who’ve been with the agency for years and still believe in good old brand building that takes years over say new-age start-ups or young shops that are happy with a single awareness campaign splash or double down on performance marketing.
They are the ones spending crores of rupees to advertise themselves, but are now scratching their heads, unsure of who will lead their accounts because they are uncertain of the shape VML will take; we are certain WPP will have taken or will take clients into confidence soon enough but the anxiety about what will happen is a human emotion common across agency and client sides.
Mathias feels a lot of clients will have to pick and choose whom they want to work with going forward. He feels the clients will break down their needs with specialist agencies.
“Instead of being wedded to network agencies, clients have to be flexible, in terms of who they partner with…” echoes Sampath. She too feels clients will now work with multiple shops instead of one legacy agency partner.
An eclipse on global networks?
In the past 36 months, Dentsu India saw its entire top leadership leave and several of its agencies lose their identity to merge into a single creative shop called Dentsu Creative.
Two of the names include Webchuntey and Taproot, giants in India’s post-liberalisation internet-led advertising age.
It is important to note both Dentsu India and Wunderman Thompson’s fates were decided by the network’s global leadership.
Indian clients may well begin to question the thinking of the global leadership after the agencies they partner with are dissolved in such a manner.
“If I was a client, I'd put the clause in the agency contract: ‘My team cannot change,’” states Padhi.
He says, like the agencies which pride themselves on their clients, it is the same feeling on the other side, and that “it is a tedious process for a client to once again call for a pitch and find an agency with like-minded folks.”
A senior client once asked Padhi: “If you can't manage the branding of your agency, how can you do justice to our brand?” It is quite a fair question from the person who signs the agency’s cheques.
WPP has said that the merger will become effective from the first day of 2024. It is quite a coincidence that the news came during Navratri when the goddess Durga is said to visit the Earth realm. She and all gods always advise folks to become detached and believe in the impermanence of life through symbolism or explicit commandments.
Wunderman Thompson’s last major client was IndiGo, an airline. The agency and, going forward, VML’s new office – Bay99 – overlook the CSIA’s (Mumbai international airport) runways where the airlines’ planes will touch down and take off without staying for too long; a symbol of impermanence.