MEDIA BUYING & PLANNING: INTENSIVE COURTING PUTS INDIES IN SPOTLIGHT: 'ELECTRIC EFFECT' TRIGGERED IN MOVES BY BIG HOLDING SHOPS

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There are differing opinions on whether independent media- buying services should consider acquisition offerings from large ad-agency holding companies.

Yet executives at indies agree this interest, which has intensified in the past year, is good for their industry because it signals a turnaround in the perception of media buying as a separate business.

"I think the effect on everybody is increased competition," says Gene DeWitt, president of DeWitt Media, New York. "On the other hand, it legitimizes us as a service. The big holding companies have gone from pooh-poohing media buying to thinking it's a valuable thing to have. .*.*. The effect has been electric."

OMNICOM ACTS

Since the beginning of 1996, Omnicom Group has purchased Creative Media, New York; Interpublic Group of Cos., which bought behemoth Western International Media, Los Angeles, in 1994, bought Media Inc., New York; and Aegis Group added Media Buying Services, New York, and International Communications Group, Los Angeles, to the fast-growing Carat North America (see story on Page S-1).

Indeed, the top 20 free-standing media-buying services combined for more than $9.3 billion in media purchasing power, according to Advertising Age research.

These shops range in size from $3.2 billion, for Western International to $100 million for Media Inc. (see chart above).

The future for independent buying services, however, may depend on their ability to adapt and to fill a niche. They must combat clients' perceptions that size and "clout" are all-important, many in the industry contend.

MORE ATTENTION TO OPERATIONS

The niche that indies can best occupy may be offering personal attention for smaller advertisers.

Leonard Cohen, president-CEO of the independent Kelly, Scott & Madison, Chicago, says many smaller clients go to independent buying services for the "hand-holding" they provide.

"There are lots of clients who don't want to be with a billion-dollar agency, to be part of a big conglomerate where they're lumped in with everyone else," Mr. Cohen says.

Mary Beth Price, president of Media That Works, Cincinnati, says another perception among advertisers that works in independents' favor is that they have more flexibility in allocating money, since there's no outside entity monitoring their spending.

"Let's face it: the big, publicly held companies have to always worry about the bottom line," she says, adding that this may detract from the quality of their service.

The ability to operate independently is a prime concern to those who do opt for a buyout.

Bob Hanley, chairman of Creative Media, says the shop was courted by several holding companies before deciding on Omnicom.

"Ominicom allows us to stay independent in attitude and philosophy. They want that," says Mr. Hanley.

KEEP AN OPEN MIND

Walter Staab, chairman of independent SFM Media, New York, says independents should keep an open mind toward acquisition or strategic alliances.

Even though SFM is "fiercely independent," Mr. Staab says the shop does meet with interested companies to discuss possible alliances. He says SFM and other independents must decide carefully what they want for the future.

"The independents have got to determine what their game plan is," says Mr. Staab. "Those that want to play in the bigger field have got to expand" by forming alliances, merging or being acquired.

While acquisitions may continue, few say indies will disappear.

Ms. Price says there may well be room for both independent and partially or wholly owned buying units to prosper.

"Maybe it's not an either-or," she says. "Some people like Tide detergent, and others like Cheer. In media, some clients like the independent aspect, others

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