Dentsu Australia prepares for lift off

Credit: Shawn Henry via Unsplash

Dentsu Australia is forecasting it will have the local business back in the black in 2026.

Rob Harvey, the recently appointed CEO for ANZ, believes the business has already seen the bottom.

“We're forecasting that we will have the business in positive territory next year,” he told AdNews.

“My brief is to position this business for what it needs to be for the future and ensure that we're returning it to growth and making sure it's super competitive in our local market. And there's a whole lot of activities we're doing aligned to the delivery of that."

The Australian business reported a loss of $63.9 million in the year to December 2024, a big improvement from the $483 million red ink the year before.

The local business still has a net asset deficiency of $295 million, and growing, and negative cash flow in “difficult” market conditions.

But the Japan-based parent is supporting Australia and New Zealand, part of its international business which has been reporting negative growth across the world.

Harvey was brought in from New Zealand in August, building on work done previously by Patricio De Matteis, who led the ANZ business since 2023.

“We've significantly turned around the operating profit performance of the business this year, resetting the foundations of the business,” Harvey said.

“I'm really optimistic about the commercial performance for the business.”

Globally, dentsu is betting on the media side of the international business to right the direction of growth.

“Media is the biggest part of our business, but I actually think the growth engine is the connected capability that we have and using that to power all of the individual components,” Harvey said.

“We are in a very fortunate position here, where we have an amazing breadth of and diversity of capability.

“That spans everything from the work we do in media, the data and analytics capability that supports that through to design and experience practice, through to the technology capability, the creative capability, and even then stretching into much more diverse capabilities, like gaming.”

Harvey has been walking the floor and visiting all the dentsu offices in Australia since he was appointed CEO of both New Zealand and Australia.

“I spent the first month really focused on our people and our team and understanding how we were working with clients from their perspective and what we needed to do to unlock the business,” he said.

“And obviously there were key clients that I met through that period as well, but then I've been really focused in the last couple of months on our supplier relationships and our client relationships.”

His family is still in New Zealand, so he flies into Australia, sometimes Melbourne, other times Sydney, each Sunday and returns Friday.

“I like to be very connected to what's happening in the business, to our teams, to the culture of the place,” he said.

“I'm a massive believer in the power of momentum and just the energy you feel in an organisation.

“For me to get close to that, I have to be in and amongst it, to be meeting with our clients, be involved in new business pitches and I need to be there in the product development work. “It's always really important to me that any comms that are issued from me to our business are authentic and they're transparent.

“I'm very involved. I've leant really heavily into lifting the degree of communications internally, with openness and authenticity.

“From a staff perspective, it's really important to me that when you're going through periods of change, that you're open and you're connected to what's happening in the organisation.”

And feedback from staff is that this is making a difference. Of the 30 areas in which dentsu surveyed staff relating to engagement, 29 of them have improved and one of them remained stable.

The two areas that have shifted the most are leadership trust and leadership communication.

“The effort that we're putting into, you know, uniting our team, building confidence in the team, common belief system, and sharing openly and transparently is really working,” he said.

“I'm a big believer in culture and our people driving everything, because we can have the best strategy in the world. We can have, you know, amazing technology and AI products and, you know, great talent and certain individuals.”

With clients, he found a reassuring high degree of confidence in dentsu.

“They have a high degree of trust in us, and we're doing some really good work for them,” he said.

“They obviously are heavily invested in their own technology transformations and looking for us to partner with them through that.

“But underpinning all of that, what clients want more than anything, is just strong strategic partnership.

“They want to know that they've got someone who understands their business that is in lockstep with them and helping them shape what they need to do strategically for their business.”

The sentiment among clients is varied. “It depends on the sector in which the clients operate. So some are saying there's green shoots, and feel confident and optimistic. Others are seeing real challenges.

“I'd describe it overall as a continued sentiment of uncertainty.”

Harvey sees change as a constraint in the industry.

“I don't think we're literally finished reorganising and changing things, because I think if you're not doing that, then you've got a problem.

We are in the process of finalising how the leadership structure and the individuals within that.

“And then there's a couple of areas where it's really important we're investing in new talent and new roles within the organisation.”