IAS Smarts becomes Gate Worldwide
There is no acquisition this time around though, with the advertising division of the company simply moving over to another division of Media Square, the more consumer-focused, The Gate Worldwide.
The agency will continue to be led in Edinburgh by Smarts founder and creative director Pete Martin (who worked as executive creative director for The Gate Worldwide at its New York office) and Helen Hourston, managing director. Both have also joined the UK board of The Gate.
Sitting in the boardroom, overlooking Leith’s harbours and the good ship Britannia, both are clearly relaxed about the move.
The departure of the Scottish creative division means that IAS Smarts will be divided, with the PR team in Glasgow, Birmingham, Dublin and Edinburgh becoming Smarts, with the B2B division in Manchester, led by Morrice, henceforth known as IAS.
Upon the news breaking, murmurs in the Scottish industry led to speculation that founders Martin and Morrice had fallen out, something Martin entirely denies, stating that Morrice has decided to concentrate his energies on building the Manchester side of the business.
“By focusing completely on what is a more difficult business, but which is less competitive, Rob believes that the margins and the opportunity for growth will allow him to grow faster,” says Martin.
“He wants to spend five working days in Manchester concentrating on how to grow that business. He sees it as a real opportunity for himself.”
“The relationship between the Manchester office and ourselves is still very strong, though,” reiterates Hourston.
But, now Scotland can welcome to its shores a new name in marketing, adding Edinburgh to its office offering that currently extends to London, New York, Shanghai and Hong Kong.
With Martin having previously worked with the International company, there was already a good relationship between the two agencies, especially its London base, and Hourston says it was an easy move to make as a result.
“Historically, we’ve always had a really strong relationship with the guys at The Gate and if something cropped up in Scotland, it would tend to be them we called rather than any of our other offices,” explains Hourston. “And vice-versa. That relationship goes back quite a period of time. But, more recently, those conversations have become more frequent.
“There was a cultural fit and a natural business fit. It seems like absolutely the right thing to do.”
The Gate Scotland will now be given the opportunity to work with many of the network’s existing clients. And Martin says that alongside the Scottish agency’s clients – such as National Australia Bank, Scottish and Southern Energy, and a place on the Scottish Government roster – the Edinburgh team’s creative function will help to enrich the network.
“We’ve got a range of skills here that will benefit the guys in London. Also, Scotland is cheaper than London. So if you want something done, it’s an extremely cost-effective way to add resource to your business.
“We will now represent a fifth of their business – and adding an extra 20 percent to their books.”
An attraction to joining the globe-spanning organization is that its sister offices are all based in “International commercial centres.” Edinburgh, he claims, fits perfectly into that mould.
According to Martin, a major difference between the launch of the company in Scotland compared to previous worldwide networked agencies that have since withdrawn (such as Draft, TBWA and KLP Euro RSCG) is that the agency and its people are already grounded and that there is an established understanding of the Scottish marketplace.
“You have to understand the market and the culture of Scotland which is quite distinctive. That’s our first ambition, that people understand what the proposition is and accept it as being genuinely different from the rest of the market.
“But this is not just another international network. This is being driven from Scotland. Other groups have parachuted in people from other places, we are launching with an established team.”
While the move is beneficial to Martin and Hourston, allowing them more freedom to control their business and take it in the right direction, they also hope that the offering of worldwide expertise will attract larger Scottish clients.
“A lot of business have focused on the wrong thing. Distinctiveness isn’t something that has been valued. Different clients value different things, so our main challenge is to align ourselves to what clients want and what clients value.”
However, despite Martin and Hourston’s talk of value-tailored service, they are also quick to point out that they aim to add a few values of their own to the Scottish industry.
Both Hourston and Martin are set to use a whole new way of looking at how to charge clients, something they know will not go down well with everyone.
“I have a lawyer,” says Martin. “I can’t talk to him after five o’clock. He does things in his own time and he earns a lot of money as a business. But we work harder and put more original effort into helping our clients solve their problems. We cannot pull a document off the shelf, change the names and stick it back out again. It’s not easy because we operate in a very competitive market, but I would like us to look at the way we charge as a business model.”
However, while the subject of payment may not be a new one, Martin offers an idea of a new model of charging that he believes could revolutionise the way that the agency works.
“Our New York office had a great idea, and I thought ‘could we make it fly?’ We charge differently for the intellectual, thought-based part of what we do. The more mechanical work, well that costs what it costs so we find a new model to charge.”
He continues: “What if you have an idea in the first 30 seconds? How much do you charge a client for that? We should charge partly for the amount of time that it’s going to take, partly for the degree of expertise that we have and partly for the degree of difficulty of what we’re being asking to do.”
Hourston takes up the issue: “The expected speed of turn-around is quite phenomenal. And the process is centred on the ideas, rather than the full intellectual process behind these ideas that leads to the right solution.
“That is becoming more of an issue. Certainly in marketing in Scotland, there’s an expectation to just magic something out of the hat in a couple of weeks without actually going through that intellectual process. We need to change that.”
The Gate Worldwide, be it through its pricing structure, its new network thinking or its creative approach, aims to be different, offering clients something new within the busy marketplace.
However, as the new agency sets about this marketplace, the questions remains, ‘can it differentiate itself in a fiercely competitive arena? And can a global network really make it in Scotland?’
Well, Martin and Hourston certainly think so, as they aim to change the landscape of Scottish marketing.