Advertising heavyweights Essence and MediaCom to Combine Forces, Meanwhile WPP Forms a Tech Team of 9,000 Professionals
In a significant move, global advertising giant WPP has announced a strategic overhaul of its media agencies, aiming to create a more centralized, simplified, and client-focused media business. The key component of this strategy involves consolidating several of its agencies and integrating advanced technology across their offerings.
The rebranding and restructuring of GroupM to WPP Media mark the end of GroupM as a corporate entity and the birth of WPP Media as a client-facing identity. This restructuring has resulted in significant organizational changes, with many global roles at risk of redundancy, signifying a leaner structure focused on efficiency and clarity for clients.
As part of this overhaul, GroupM Services will merge with Xaxis and Finecast to form a new entity called GroupM Nexus. Similarly, Essence and MediaCom will merge to form EssenceMediaCom, while Mindshare will merge with Neo to create a new entity. These mergers are aimed at servicing large clients more effectively and expanding the service offering.
The collaboration among these GroupM agencies is not a unique occurrence within WPP. It is part of a wider trend in the media industry, with media agencies within WPP combining forces to share resources and expertise, leading to improved efficiency and effectiveness in service delivery. This collaboration is not limited to GroupM agencies, as WPP has announced three planned mergers in total.
WPP's commitment to technology integration is evident in the launch of an AI-powered tech platform called Open Intelligence as part of its Vision 30 strategy. This platform is expected to enhance data-driven decision-making and media buying capabilities. Additionally, WPP has acquired InfoSum, a data collaboration platform, to evolve beyond legacy technology like cookies and enhance WPP’s capabilities in data privacy-compliant identity solutions and audience targeting.
WPP recognizes that automation and AI are reshaping ad buying and creative execution, requiring meaningful investments to stay competitive. The leadership transition, with CEO Brian Lesser spearheading the simplification and centralization efforts, is partially tied to positioning the company for success in this new AI-driven era.
However, WPP has faced challenges, including losing significant clients such as Mars and Coca-Cola to competitors like Publicis, reflecting the competitive pressures and the critical importance of successfully executing their consolidation and technology strategy.
In summary, WPP is consolidating its media agencies under the WPP Media brand to create a centralized, simplified, client-focused media business, while aggressively investing in AI and data technologies like Open Intelligence and InfoSum to transform media services into a technology-enabled offering for the future. This strategic shift is expected to position WPP for success in the rapidly evolving media landscape.
[1] WPP (2022). WPP Media: The New Face of WPP's Media Business. [online] Available at: https://www.wpp.com/media/wpp-media
[2] The Drum (2022). WPP announces three planned media agency mergers. [online] Available at: https://www.thedrum.com/news/2022/04/13/wpp-announces-three-planned-media-agency-mergers
[3] Ad Age (2022). WPP's Brian Lesser on the Future of the Agency Business. [online] Available at: https://adage.com/article/special-report-vision-30/wpp-s-brian-lesser-future-agency-business/2347055
[4] Campaign US (2022). WPP's Brian Lesser on the Future of the Agency Business. [online] Available at: https://www.campaignus.com/article/wpps-brian-lesser-on-the-future-of-the-agency-business/
- The merge of Essence and MediaCom, along with other planned mergers within WPP, illustrates the company's focus on expanding its business offerings by serving large clients more effectively through the integration of technology.
- In line with WPP's desire to remain competitive in the evolving media landscape, the company's commitment to technology is evident in its investment in AI and data platforms like Open Intelligence and InfoSum, aiming to transform media services into a technology-enabled offering.
