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Ad Agency Courts New Tech Ideas

Jun 15, 2008  •  Post A Comment

In the latest sign that big media firms must become conversant in the language of the little guys to survive, Havas-owned advertising agency EuroRSCG launched an incubator program for early-stage startups in its San Francisco office.
The purpose of the program, dubbed “the Hot House,” is to bring fledgling entrepreneurs, most of whom are focused on new advertising and Internet-based technologies, into the same physical space as the ad agency. That gives the agency a headstart in working with the potential next hot new thing and also gives the companies a chance to cut their teeth next to seasoned advertising executives.
Once a quarter, the startups present to the agency’s staff. The first such meet-up was held last week and EuroRSCG invited TelevisionWeek to attend.
EuroRSCG is a full-service agency that buys and crafts ads for clients such as Genentech, Adobe, Charles Schwab, Wells Fargo, Sony Pictures, the U.S. Air Force, Neutrogena and others across television, online, out-of-home and other areas.
While not strictly a video-based incubator, some of the companies in the Hot House have interests in online video, such as Qmecom, which specializes in delivering targeted online video messages, and Adgent007, which places premium brands against international traffic for popular international newspapers, many of which offer video online.
EuroRSCG’s efforts underscore the growing importance that media and advertising agencies place on emerging new-business opportunities in an increasingly multiplatform world.
“It gives my people perspective this is well beyond the [norm],” said Alan Burgis, CEO of EuroRSCG in San Francisco. “This is about a culture that moves quickly, cost-efficiently, and you have to be prepared to get on that horse or get off that horse quickly. Most of those characteristics are a lost art in the ad business. The more time we can spend with these people, the more we inherit their culture of speed, cost-efficiency, tenacity.”
Keeping Pace
Working with startups is becoming a business imperative given today’s changing media landscape, said David Cannington, who manages the Hot House. “Housing early-stage tech companies within an agency environment supports that trend toward the blending of Silicon Valley and Hollywood and Madison Avenue all under one roof.” he said.
EuroRSCG’s efforts are unusual in the agency world, but do share some kinship with a former Carat project, the Carat Exchange. Mitch Oscar, Carat’s former executive VP of digital, launched the Carat Exchange in late 2004 as a quarterly forum for interactive television firms to introduce themselves to Carat buyers and to the TV programmers, cable executives and other industry players who attended. In more than three years, the Carat Exchange became a launching pad for tests of interactive TV in various cable markets around the country.
Mr. Oscar recently left Carat and now is working with media agency MPG, also a Havas company. He will be starting a similar group called the Collaborative Alliance under MPG’s auspices in the fall.
The lineup at last week’s EuroRSCG presentation included Matter Network, an alliance of 40 Web site publishers focusing on sustainability and green resources for business; GoodBarry, a Web site management company; Kontent, a work-for-hire production shop focusing on producing inexpensive new-media content for brands; MadeIt, an online event management and ticketing service for midsize events; and Adgent 007.
Working with these companies gives EuroRSCG clients early-mover advantage if the agency wants to test some of the technology and services, Mr. Burgis said. “We can sit with Adgent007 and spend time together and then say let’s try something,” he said.
He acknowledged that many of the companies coming through the incubator will fail. “The issue for all these companies is whether they can sell their notions to the venture capitalists before they run out of money,” he said.
However, the benefits outweigh the risks. “We are closer to being a Web 2.0 agency,” he said.

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