Parents in media planner split, spawn new agencies
Mediapolis started up in 1996 as a joint project between agencies EuroRSCG and Young & Rubicam. But the media relationship between the two agencies was dissolved at the beginning of 1999, when upper management of both firms agreed to part ways.
"We were aware for a long time that this time would come," said Marek Hancke, general manager for EuroRSCG in Poland.
EuroRSCG now plans to open its Warsaw version of independent media house Media Planning on Jan. 1. Media Planning, however, has started operations in other countries. Billings for Warsaw-based operations are projected at zl. 200 million ($51.2 million) during the first year, Hancke said.
Young & Rubicam is not letting moss grow after the break up. Late last month, the ad agency launched Media Edge, which also takes after now-defunct Mediapolis as media planner. While Media Edge remains a division of Young & Rubicam, plans are afoot to make it into its own legal entity by February 2000.
Since the beginning of 1999, Young & Rubicam has made an effort to expand media planning in Europe through its creation of Media Edge, said Anna Lubowska, general manager at Media Edge. "I think it was very well-prepared," she said of the new operation.
Industry sources have said that separating media planning from the rest of an advertising agency's creative work can be a source of conflict within an agency because media planning represents a substantial amount of revenue for an ad agency. If, for example, a commercial is shot outside the country, in many cases it would only need translation and media planning, something that a media planner could do itself.
But Lubowska disagreed and noted that approximately 80% of television commercials shown on Polish television are shot in Poland. And advertising agencies can be involved in the creative side, translating and adapting foreign-made commercials to the Polish market.
Setting up a separate media house isn't as easy as it may seem, Lubowska said. "It takes some time to understand the benefit of the process," she said. "It can be tough for some people in the beginning." Difficulties aside, some question the value added from carving out a media planning operation.
"The general trend is for people to rebrand their media departments," said Al Harris, managing director with media planning house Media Group. "If it's the same people, what is it going to bring?"
About $60 million for Media Edge this year, according to company estimates. Clients currently on the new media planner's list are Danone, Colgate-Palmolive, Philip Morris, Ericsson and Citibank.
Big board consolidation
U.S. media and outdoor giant Clear Channel Communications has taken the plunge into Poland's outdoor ad market.
Clear Channel, through its subsidiary Clear Channel International, in mid-July acquired 82% of Plakanda Holdings, a leading outdoor ad company in Poland and Switzerland. The company would not reveal the price of the transaction.
"It was something everybody in the business had anticipated for a long time, that one day a huge American company would come to Poland," Bogdan Gumkowski, general director of Plakanda International Poland, told the Business Journal. "The transaction caused much stir on the market, which seems to be afraid of even stronger competition."
Plakanda, a privately owned company, is the second largest outdoor advertiser both in Switzerland and Poland with some 9,500 and 5,000 panels respectively in these countries.
Clear Channel Communications, a publicly traded U.S. media company, operates or is affiliated with 625 radio stations, 19 television stations and approximately 425,000 outdoor advertising displays in 26 countries worldwide. The company also owns 29% of Hispanic Broadcasting Corp., the largest Spanish-language radio broadcaster in the United States. Clear Channel is traded on the New York Stock Exchange (NYSE).
In its recent expansion strategy, Clear Channel through subsidiary More Group took a 51% stake in Italy's leading outdoor ad company Jolly Pubblicita.
The acquisition of Plakanda is Clear Channel's first investment in Switzerland and Poland. But in Eastern Europe, it also has outfits in Latvia, Lithuania, Russia and Estonia.
"By judging their recent moves in entering Europe, it's my hunch that the transaction is a forerunner of more visible expansion into the market," Gumkowski said. "It's a huge company, so I don't think they would agree to remain a medium company in Poland."
Clear Channel International has been seeking a route into the important Swiss and Polish markets for some time, Roger Parry, CEO of Clear Channel, said in a press release. Clear Channel will support Plakanda's existing management team in its expansion plans, he said. Gumkowski emphasized that the acquisition would not result in staff changes.
Plakanda has been in Poland since 1990, and according to Outdoor Advertising Association estimates, had a 7.7% market share in March 1999. Its main competitor and the largest outdoor advertising company in Poland, publicly traded AMS, now has 11,228 panels and has seen sales increase from zl 10,000 in 1990 up to zl. 59 million ($16.86 million) in 1998. AMS's share price has fallen about 2% since Clear Channel's acquisition was announced here July 13.
"We are the second company in Poland as far as revenues are concerned, when viewed with respect to the number of panels," said Gumkowski of Plakanda.
He emphasized that with only half the number of panels, Plakanda's revenue for 1998 came in at a sizeable zl. 40 million ($11.43 million). Plakanda's main clients include Coca-Cola, tvn, Lech Browary Wielkopolski and Daewoo.
Screen prize
Piotr Weresniak, a young Polish screenwriter, has taken first prize in the Hartley-Merrill International Prize for Screen Writing.
Weresniak won the competition for his screenplay "Station." The action takes place at a gas station, where two attendants are at odds over whether to treat with greed or sympathy a driver who arrived with a bullet wound and a pile of money.
In addition to a mini-statue, workshops, tours to film studios and a small cash award, Weresniak likely increases the chances of realizing his screenplay here in Poland, media watchers said. Weresniak also wrote the screenplay for comedy hit "Kiler," released two years ago.
Weresniak qualified to compete in the final round of the Hartley-Merrill contest after winning the qualifying round in Poland. The Polish Script Agency, which has organized the qualifying event since 1992, chose Weresniak from among three finalists.
- Chris Rivituso and Justyna Wrobel
contributed to this column.
"We were aware for a long time that this time would come," said Marek Hancke, general manager for EuroRSCG in Poland.
EuroRSCG now plans to open its Warsaw version of independent media house Media Planning on Jan. 1. Media Planning, however, has started operations in other countries. Billings for Warsaw-based operations are projected at zl. 200 million ($51.2 million) during the first year, Hancke said.
Young & Rubicam is not letting moss grow after the break up. Late last month, the ad agency launched Media Edge, which also takes after now-defunct Mediapolis as media planner. While Media Edge remains a division of Young & Rubicam, plans are afoot to make it into its own legal entity by February 2000.
Since the beginning of 1999, Young & Rubicam has made an effort to expand media planning in Europe through its creation of Media Edge, said Anna Lubowska, general manager at Media Edge. "I think it was very well-prepared," she said of the new operation.
Industry sources have said that separating media planning from the rest of an advertising agency's creative work can be a source of conflict within an agency because media planning represents a substantial amount of revenue for an ad agency. If, for example, a commercial is shot outside the country, in many cases it would only need translation and media planning, something that a media planner could do itself.
But Lubowska disagreed and noted that approximately 80% of television commercials shown on Polish television are shot in Poland. And advertising agencies can be involved in the creative side, translating and adapting foreign-made commercials to the Polish market.
Setting up a separate media house isn't as easy as it may seem, Lubowska said. "It takes some time to understand the benefit of the process," she said. "It can be tough for some people in the beginning." Difficulties aside, some question the value added from carving out a media planning operation.
"The general trend is for people to rebrand their media departments," said Al Harris, managing director with media planning house Media Group. "If it's the same people, what is it going to bring?"
About $60 million for Media Edge this year, according to company estimates. Clients currently on the new media planner's list are Danone, Colgate-Palmolive, Philip Morris, Ericsson and Citibank.
Big board consolidation
U.S. media and outdoor giant Clear Channel Communications has taken the plunge into Poland's outdoor ad market.
Clear Channel, through its subsidiary Clear Channel International, in mid-July acquired 82% of Plakanda Holdings, a leading outdoor ad company in Poland and Switzerland. The company would not reveal the price of the transaction.
"It was something everybody in the business had anticipated for a long time, that one day a huge American company would come to Poland," Bogdan Gumkowski, general director of Plakanda International Poland, told the Business Journal. "The transaction caused much stir on the market, which seems to be afraid of even stronger competition."
Plakanda, a privately owned company, is the second largest outdoor advertiser both in Switzerland and Poland with some 9,500 and 5,000 panels respectively in these countries.
Clear Channel Communications, a publicly traded U.S. media company, operates or is affiliated with 625 radio stations, 19 television stations and approximately 425,000 outdoor advertising displays in 26 countries worldwide. The company also owns 29% of Hispanic Broadcasting Corp., the largest Spanish-language radio broadcaster in the United States. Clear Channel is traded on the New York Stock Exchange (NYSE).
In its recent expansion strategy, Clear Channel through subsidiary More Group took a 51% stake in Italy's leading outdoor ad company Jolly Pubblicita.
The acquisition of Plakanda is Clear Channel's first investment in Switzerland and Poland. But in Eastern Europe, it also has outfits in Latvia, Lithuania, Russia and Estonia.
"By judging their recent moves in entering Europe, it's my hunch that the transaction is a forerunner of more visible expansion into the market," Gumkowski said. "It's a huge company, so I don't think they would agree to remain a medium company in Poland."
Clear Channel International has been seeking a route into the important Swiss and Polish markets for some time, Roger Parry, CEO of Clear Channel, said in a press release. Clear Channel will support Plakanda's existing management team in its expansion plans, he said. Gumkowski emphasized that the acquisition would not result in staff changes.
Plakanda has been in Poland since 1990, and according to Outdoor Advertising Association estimates, had a 7.7% market share in March 1999. Its main competitor and the largest outdoor advertising company in Poland, publicly traded AMS, now has 11,228 panels and has seen sales increase from zl 10,000 in 1990 up to zl. 59 million ($16.86 million) in 1998. AMS's share price has fallen about 2% since Clear Channel's acquisition was announced here July 13.
"We are the second company in Poland as far as revenues are concerned, when viewed with respect to the number of panels," said Gumkowski of Plakanda.
He emphasized that with only half the number of panels, Plakanda's revenue for 1998 came in at a sizeable zl. 40 million ($11.43 million). Plakanda's main clients include Coca-Cola, tvn, Lech Browary Wielkopolski and Daewoo.
Screen prize
Piotr Weresniak, a young Polish screenwriter, has taken first prize in the Hartley-Merrill International Prize for Screen Writing.
Weresniak won the competition for his screenplay "Station." The action takes place at a gas station, where two attendants are at odds over whether to treat with greed or sympathy a driver who arrived with a bullet wound and a pile of money.
In addition to a mini-statue, workshops, tours to film studios and a small cash award, Weresniak likely increases the chances of realizing his screenplay here in Poland, media watchers said. Weresniak also wrote the screenplay for comedy hit "Kiler," released two years ago.
Weresniak qualified to compete in the final round of the Hartley-Merrill contest after winning the qualifying round in Poland. The Polish Script Agency, which has organized the qualifying event since 1992, chose Weresniak from among three finalists.
- Chris Rivituso and Justyna Wrobel
contributed to this column.
