On Monday, August 21st, the UK’s Aegis plc is expected to announce the acquisition of 75% of Strategic Planners International [SPI], an independent media specialist in Tokyo.

The company will be renamed Carat SPI Ltd. and become the thirteenth Carat office in Asia, after Sydney, Hong Kong, Beijing, Guangzhou, Shanghai, Bombay, Delhi, Kuala Lumpur, Manila, Singapore,Taipei, and Bangkok.

SPI was founded in 1995 as Japan’s first independent strategic media planning company, by a group of executives formerly with Bates Japan including Mr. Kim Walker, Mr. Tsuneo Honda and Mr. Akira Murayama.

Since that date, a number of agency groups have launched their own media specialist agencies in Japan. These include WPP’s Mindshare, Grey’s MediaCom, Leo Burnett’s Starcom. Omnicom’s OMD has also been exploring routes into Japan.

SPI has built a profitable business on revenues of around ¥150 million by advising major advertisers how best to spend their media budgets through the application of models that help determine the relative effects of media and other factors on sales.

"Because we are not a media buyer, SPI can be totally objective and accountable in its recommendations even recommending reductions in budgets or shifts to unorthodox media if appropriate," says Walker, SPI’s president.

Over the past two years, SPI has been approached by a number of agency groups as well as CIA, Carat’s main rival in Asia as a media independent.

"We decided to go with Carat because much of our work involves data mining to develop strategic insights. We visited Media Market Assessments (MMA), a leader in this field in the USA and also an Aegis company. We felt their skills could complement the work we are doing in Japan," explained Walker.

"Carat is a widely respected and powerful company. We aim to marry our unique, Japanese experience, with the international resources of Carat to enhance the delivery of global best practices to our clients," added Walker.

SPI has proved highly competitive with Japan’s Western multinational agencies. Despite a policy of not making competitive pitches, in January this year, SPI prized responsibility for media planning on Volkswagen in Japan from DDB. That same month Nippon Lever, Unilever’s Japan subsidiary, moved media planning responsibilities for Dove, from Mindshare to SPI.

SPI currently handles the media planning for budgets totaling [Yen] 17 Billion mainly from Western multinationals including adidas, Club Med, Disney, Nippon Lever, Warner Lambert, and Volkswagen. Japanese clients, notably Fujitsu Ltd. for whom SPI do all TV planning for its brand campaigns, account for 15% of the business.

"SPI have helped us focus our media campaigns much more effectively and strategically," says Michael Allen, vice president and controller for Walt Disney International, "they have played a key role in the success of our theatrical business in Japan over the past three years, and provide us with a quality of service that we have not found elsewhere."

The acquisition is strategically important to Carat because Japan accounts for about half of all advertising expenditures in Asia. Consequently the market is important not only in its own right but is also an essential base for providing a networked service across Asia for multinationals.

The Aegis acquisition increases the pressure on CIA to establish a base in Japan. In recent months, CIA executives have been exploring acquisition or partnership with a small Japanese agency that might wish to re-launch as a media specialist -- a significant challenge since even the very largest Japanese agencies have yet reach for international best practice in media planning.

SUBSEQUENT EVENT

5th September 2000 / Press Release

Tempus Group makes first Acquisition in Japan

Tempus Group PLC, the global marketing and communications group, has acquired a majority stake of one of Japan’s leading independent Market Research companies; International Creative Marketing (ICM).

Tokyo based ICM have been operating as a leading Japanese provider of Marketing Insight for approaching 20 years and have built a strong reputation for delivering both quantitative and qualitative research to Japan’s leading marketing organizations.

ICM ‘s long-standing blue-chip clients include Coca-Cola, Nippon Lever, Kirin and Nike. Employing over 75 staff and with significant revenues, ICM are ranked 7th in the massive Japanese market.

ICM were attracted to the UK based Tempus Group because of their vision for developing their "Agency of The Future" business model that places Insight at the heart of all the Tempus businesses; CIA, Added Value, Brown ID and Outrider.

Mark Austin, regional managing director of the Tempus owned CIA Asia Pacific and a director of Tempus Group Plc said of the deal’-

"The Japanese market is a notoriously difficult market for foreign companies to penetrate and with ICM we are most fortunate to have found strong, visionary partners with whom we will build the Tempus brands in the worlds second largest economy.

Inviting ICM as a top class research company, to be a part of our vision and to deliver the platform of insight upon which we build our CIA, Added Value and Outrider businesses is we believe, an innovative and exciting way to develop the marketing and communications services that clients are really seeking in Japan. The Tempus model of Agency of the Future is built around "Insight". ICM are therefore the perfect partners for this vision.

Shogo Matsui, President of ICM said of the deal; -

"In order to keep abreast of the rapidly changing market environment as well as to upgrade the quality of our services as a market research house catering for clients needs, I have decided that our company should join a global scaled marketing/communication agency with a vital new vision, that is, The Tempus Group.