Is there more to Cheil than Samsung?

Korean agency Cheil has appointed former Leo Burnett London chief Bruce Haines to realise its international ambitions. The industry is split over whether he can pull it off.

Cheil is looking to shake off its image as a one-client agency and has tasked Haines with building its presence around the world by buying or partnering with agencies in key markets, including London and New York. Haines, who starts on April 16 and will be based in Seoul, has been appointed to the new role of global chief operating officer at Cheil, as exclusively revealed by marketingweek.co.uk last week (MW.co.uk, February 20).

The agency was born out of Korean electronics giant Samsung and has 35 offices around the world. Although still part of the Samsung Group, the company’s stake in the agency is now just 15% with the rest being floated on the stock exchange. Cheil is the biggest agency in Korea, twice the size of its nearest competitor by billings in its home market, but the agency’s only other global business is tyre company Hankook.

The agency, which is run in Europe by president Terry Son and vice-president Saul Pearce, is ranked as the 16th biggest in the world – largely thanks to Samsung – and aims to break into the top ten by 2010.

Competitive ambition

Pearce says: “Our ambition in the longer term is to build a competitive full-service agency and to work with a number of different clients. We have very serious plans afoot and Bruce is integral to setting those plans in motion.”

Cheil is Samsung’s local and regional agency, while Leo Burnett, Haines’ former agency, handles its global account. CHI & Partners is also on the company’s roster, having created several global campaigns for Samsung. But a source close to Cheil suggests there is no reason the agency cannot handle the global account itself one day if it strengthens its international offering.

Cheil is hoping Haines will be a “magnet” for creative and account handling talent, with Pearce saying that his appointment is a way of “fast-tracking our growth”.

The source adds: “Hiring a heavy hitter could make all the difference. They already have the infrastructure in place and a profitable way of working – it’s not like he [Haines] is starting from scratch. If he’s going to win large multinational non-Korean clients he needs to have something – or someone – to attract them.”

Haines says the agency will be looking to win local business in Europe and the US, as well as global accounts, to help tempt talent to Cheil.

No dynamic reputation

Another senior industry source points out that Leo Burnett was not seen as a dynamic agency during Haines’ tenure. He left the agency last year after clashes over its structure (MW.co.uk October 23, 2007). “Bruce is a very good brand person but he is not an operational person so it’s a strange appointment,” adds the source. “Cheil doesn’t have a product – I don’t know what it does.”

However, a source who has worked with Cheil in the past calls the agency “incredibly beneficial” because of its knowledge of the Korean market: “You can either fight it or you can go with it and you’re mad if you don’t go with it.”

Haines says that Cheil’s Korean management is determined not to repeat the mistakes of Japanese agencies launching in Western markets. “They didn’t look at Western markets through Western eyes,” he adds. “The Koreans recognise that they need people who have the experience of working in the West.”

Another source close to Cheil points out that the agency is “phenomenally profitable”, suggesting Haines will have deep pockets when it comes to acquisitions. It seems the agencies and personnel that Haines chooses to spend his money on will determine how successful Cheil can be on the international stage.

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