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Dentsu Announces Major Cuts, Restructures From 300 Agencies To Six


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apan-based global advertising agency, Dentsu, has announced a major restructure and cuts, reducing their operations from 300 international agencies, down to six global brands.

The move comes as Dentsu announced organic revenue is down 10.9% in the nine months leading up to September, despite a large range of cost-cutting measures help operating profit fall by just 0.9%.

The restructure comes following a strategic review Dentsu started in August in an effort to simplify the business and reduce operating costs.

Dentsu CEO, Toshihiro Yamamoto, said the move will also help serve clients more efficiently.

“We simply have too many brands, almost 300 across both Japan and internationally,” Yamamoto said.

“We have already decided to simplify the Japan business into four pillars and internationally to have only six global leadership brands.

“This radical new structure will be more logical and transparent for our clients, enabling us to serve them better.

“It will also enable us to reduce costs significantly as our operations become simpler with more common systems and processes, increasing our use of shared service centres, rationalising office space and reviewing property ownership globally.

“We have won a number of new clients and significantly expanded many of our existing relationships, including KraftHeinz, American Express and Heineken.

“We are beginning to see the benefit from combining our talent, process, and technology in integrated solutions for our clients.

“However, we remain cautious on the short-term outlook, given the uncertainty surrounding the impact from COVID-19 as restrictions have now been increasing in many countries across the globe,” he said.

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