US Web Consultant and Japanese Ad Giant in Joint VentureMarchFirst and Dentsu last month launched a $30 million joint venture to provide a host of Internet services to Japanese and US companies active in Japan. It is the largest US-Japanese Internet venture so far.
DentsuMarchFirst will offer clients a complete array of new economy services, from Web strategy to brand-building and actual development and building of sites.
"Our offerings go through the back end to integration of enterprisewide systems -- core accounting, financial and manufacturing," said Merril Burns, group executive and MarchFirst partner in New York.
"We'll be offering a full suite of services in Japan, including strategy work. We bring goods. We have our Web-building technology capability. Dentsu brings customers, relationships and creative capabilities.
"Japan is a very relationship-driven market. It is a culture where relationships are extremely important. Dentsu works with 80 of Japan's largest 100 advertisers.
"We would have to be there a long, long time to get entree to the appropriate level and to win the credibility needed to be allowed to work with those kinds of companies."
MarchFirst has been working in Japan for some time and "we will be able to bring some clients into the joint venture. They have clients doing the same work we do for ours and as we come we will jointly go after new clients.
"Of course we would be thrilled to get all 80 of their big advertising clients but we don't expect to do that all at once. We're meeting now to refine the sequencing of the companies we plan to approach.
"We expect to get some stuff over the transom. We had inquiries subsequent to our press release. We're after big companies, the kind of companies we work with in the US. We've tended to have a bias towards large firms all along.
"We have been working with Japanese clients for about three years and what happened with our larger clients with whom we had been working here in the US and in Europe was that they said, 'can you work with us in Japan?' "
The bias to large company clients could be critical for Internet consultants, analysts said. Many of them are struggling right now because they bet on wobbly dot-coms and not on the far more lucrative Fortune 500.
Formed by a merger between Whittman-Hart and USWeb/CKS last March, the company now has 10,000 employees and 40 offices spread across 14 countries, including cities such as Sydney, Melbourne, Hong Kong and now Tokyo.
"We plan to open another Asian office shortly," Burns said. "We're in London, Hamburg, Frankfurt, Paris, Brussels, Milan, Madrid, Stockholm, Oslo, South Africa and in Toronto and Montreal."
That kind of experience has built a backbone staff with considerable foreign experience, something MarchFirst looks for when sending people to Japan.
"Ron Sato is an American with Japanese parents. He's been working with us for about six years. He's in his late 40s with a lot of experience and has wanted to work in Japan for some time. So we're sending him.
"A woman from Argentina with an MBA had done her undergraduate work in Japan and she wrote me an e-mail saying she spoke fluent Japanese and would like to go back.
"We have an American of Chinese descent who's worked in Japan for 12 years for an advertising agency and is now with us. He speaks fluent Japanese, has a Japanese wife and is raising his kids there.
"That's one advantage of a firm of our size. We have people in a number of positions like that who come from disciplines in foreign firms and would like to work for us in Tokyo. It's helpful to have people who have lived overseas because they are more culturally attuned."
The initial work force will be relatively small -- about 40 people from both companies for starters.
Burns thinks it is very important for MarchFirst to become more attuned to the wireless world and said Japan was the perfect place to do so.
"We have a relationship with 3com and are doing a lot of work in the wireless arena. We see this as an opportunity to advance our knowledge because we think wireless devices will become more important."
He conceded that the Japanese economy was in the doldrums but noted that "it is still the second-largest economy after the US. It is big, and at some juncture it will turn around as they work through their restructuring."