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Independent network Local Planet enters APAC, The Media Shop and Entropia among team

Local Planet International, a privately-held agency network, has launched its Asia Pacific hub with nine independent agencies. They include The Media Shop in Singapore, Entropia in Malaysia, Media Muscle in Indonesia, The Huddle Room in the Philippines and BlueFocus International in China, among others.

Established by global CEO Martyn Rattle (pictured centre) in 2016, Local Planet has 54 agencies under its wing and covers 67 markets including North America, Europe and Latin America. Its major shareholders include BlueFocus, Nunn Media in Australia, Percept in India and Horizon the US. Among its list of clients include Tencent, JD.com, Huawei, Kawasaki, Seiko, FedEx and San Miguel Corporation.

The Asia Pacific hub is headquartered in Singapore and will unite the nine agencies to service 21 markets across the region in strategy, media planning and buying, performance marketing, brand consultancy, eCommerce, content creation and production, mobile marketing, social media and data analytics. Singapore was chosen as its Asia Pacific headquarters as it is one of the top five global financial centres in the world, lauded as the most transparent country globally and is central to the Asia Pacific region.

Local Planet has a cross-shareholding structure, with no holding company mandates or external shareholders to answer to. Also, the privately-held agency network prides itself on being 100% transparent by disclosing all fees and margins and not taking positions on media or pursuing rebates. According to the network, it is the fourth largest agency network worldwide with a market share of 4.6% and a combined turnover of US$16 billion. While traditional established networks tend to reserve their biggest deals for their biggest clients, Local Planet said it offers clients to always be treated with priority, rather than be a small client in another network.

In an interview with Marketing, Rattle said there were three phases to the global launch of Local Planet. In 2016, he was focused on having agencies from the top 20 markets, including China, Japan and India, in its network. The second phase was to build up its network in Europe and North America, and the third phase was forming network capabilities in Asia Pacific and Latin America.

“BlueFocus, Percept and Ad Comm Group in Japan were the founding agencies of the original 20 markets. The cadence of our growth globally was centered around client demand and with Local Planet being headquartered in London, client demand mainly started in Europe before expanding to North America and so on,” Rattle said.

According to him, The Media Shop joined Local Planet last year, followed by Entropia at the beginning of this year. Media Muscle and The Huddle Room both joined the network approximately three months ago.

“We are currently involved in eight international pitches, half of with include Asia. On average, we work on approximately five to 10 international pitches monthly and have been involved in 150 pitches in the last two and a half years,” Rattle said.

Building local legal entities with a cross-shareholding structure

Explaining the cross-shareholding structuring, Rattle that Local Planet is owned by him and the agencies within the network. Each agency has minimum 1% shareholding of Local Planet. It also forms joint ventures with the agencies to create a separate legal Local Planet entity within each country. For example, Local Planet formed a joint venture with The Media Shop, Entropia and Media Muscle to launch Local Planet Singapore, Malaysia and Indonesia respectively.

Rattle said The Media Shop was selected to join Local Planet because it is the sole independent agency in Singapore that also happens to be the most rewarded. Meanwhile despite being three years old, Rattle was impressed by Entropia’s ability to “completely disrupt the market” and become a full service agency. Likewise for Media Muscle, Rattle said it is a “fast growing and brilliant” agency mainly focused on bringing international clients into Indonesia.

According to Rattle, many agencies have approached him to join Local Planet but only one-fifth of them make it through the six-month evaluation process. The process assesses the health of the agencies from financial, commercial, client and service standpoints, and agencies will need to score above 80% out of the 300 points on the scorecard to make the cut.

“We are looking at the last three years of their financial health to see how fast they are growing. We are also looking at the client list, as well as the quality and longevity of the clients,” he said.

Despite its latest launch in Asia Pacific, Rattle said there are currently no plans to bring on board new agencies in the region. With approximately 70% to 80% of the agencies under Local Planet having integrated capabilities, unless a region is lacking in a particular service such as shopper marketing, for example, Rattle said there is no need to introduce new agencies to Local Planet with overlapping skills or services.

“We are not looking to build up any new capability in Asia Pacific at the moment, but we are keeping a watch on things such as voice, artificial intelligence and machine learning,” Rattle added.

Going against the norms as an independent

Being independent allows clients to gain access to the agencies’ founders and senior management, which is slightly tougher for traditional established networks, Rattle said. He added:

Independent agencies can choose to invest in what clients need, not what shareholders need to generate more profit.

As they are privately-owned, independent agencies are not “hamstrung by any bureaucracy” and can afford to invest in people, as well as innovative and new services, allowing them to be more flexible and agile.

“I was able to create a network that has all the benefits of a traditional established network but with the entrepreneurial energy as well as flexibility and agility of an independent agency. I think this is what gives independent agencies an edge,” he added.

Besides having an entrepreneurial spirit, Rattle said the key to attracting talent is to share the success of the company. While employees might be “a smaller cog in the wheel” at bigger agencies, Rattle said Local Planet offers its employees ownership and talent exchange opportunities.

“If you make an impact in the company and it success, you are part of that success and you are very handsomely rewarded. At an independent agency, you have access to senior management, you’re in an entrepreneurial environment and you can control your own destiny,” he added.

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