Messages from Directors in Charge of Domestic and Overseas Businesses

To provide clients with a global network and services that meet the highest international standards, it is essential that the Dentsu Group, reinvigorated by the acquisition of the Aegis Group (currently, "Aegis Media"), further reinforce its unshakable business base in Japan—a corporate strength that infuses overall competitiveness and gives the Group a distinctly unique advantage in the advertising world.

To achieve this goal, we aim to boost profitability in existing businesses, beginning with mass media businesses, and capture wider market shares. In addition, we will tackle the two following issues as a group and strive to hone a sharper competitive edge.

The first issue is to expand our service domains, using the advertising business as a starting point. Utilizing the networks we have built to date with clients and partners, we will work to create and cultivate new business fields adapted to the development of "marketing convergence." For example, we will integrate and merge processes, from client consumer communication approaches through to sales, to deliver services that manage all stages of business.

The second issue is to continue the process of structural reform. To enhance the quality of services offered by the Group in Japan and increase profitability, we will redouble our efforts to implement various measures to redesign and innovate business processes. Specifically, we will accelerate our efforts, especially with regard to restructuring resource management and the way we provide solutions to clients.

Tokyo's winning bid to host the 2020 Summer Olympics is sure to revitalize the domestic advertising market like never before. From a client perspective, however, there is no separation between domestic and overseas markets. Working closely with our overseas networks, we will support Japanese clients seeking to achieve objectives such as entry into overseas markets and growth once in those markets, and conversely, we will support multinational clients from the United States, Asia and Europe that are seeking to establish a presence in the Japanese market.

Once again, I am reminded of just how vital it is to commit to the corporate spirit of "client first"—our starting point—with each and every employee working alongside clients as true partners, immersing themselves in the respective industries and staying involved. Thinking, planning and doing for our clients—it is this corporate spirit that serves as our source of growth.

Yuzuru Kato, Executive Vice President in Charge of Domestic Business
Yuzuru Kato
Director
Executive Vice President in Charge of Domestic Business

With the close of the acquisition of the Aegis Group and the establishment of Dentsu Aegis Network Ltd. in March, we expanded our global footprint from 29 to 110 countries, adding more than 14,000 highly talented people and becoming the first truly global network built in and for the digital age.

Clients today face unprecedented challenges, both from their competitors and from an increasingly dynamic, fragmented and complex marketplace. Dentsu is uniquely able to help clients compete in an environment that is being profoundly changed by globalization and marketing convergence.

Dentsu is differentiated from the industry in several important ways:

A "One P&L" operating model that enables genuine collaboration among companies and talents to deliver effective solutions while maximizing efficiency
A focus on providing scalable, best-in-breed specialist and holistic agency services from some of the world's most awarded and respected agencies
Strength in digital, media and creativity, and in the world's fastest growing geographic regions
A heritage of innovation at the nexus where technology and content meets the consumer
An unparalleled position in Japan, one of the largest and most important markets to global clients

We enjoy relationships with more than 70 of the 100 largest global advertisers. Our strategy is to invest in those relationships, to help our clients expand globally, and to win new assignments with a business model that is purpose-built to attract the best talent and promote their collaboration for powerful solutions.

This strategy is already working and is integral to maintaining industry-leading organic and operating margin growth over the course of our 2017 medium-term plan.

Tim Andree, Executive Vice President in Charge of Overseas Business
Tim Andree
Director
Executive Vice President in Charge of Overseas Business