- WPP CEO Mark Read recently told The Financial Times his company is ready to invest again after being battered by the pandemic.
- Investors, industry experts, and former WPP executives named 9 companies WPP might consider buying in coming months as it looks to compete with consulting companies like Accenture and Deloitte.
- The list includes consulting, e-commerce, martech, and healthcare marketing companies, although there's no evidence WPP is considering buying these specific companies.
- Visit Business Insider's homepage for more stories.
WPP, the world's largest advertising holding company, is in acquisition mode again after taking a massive hit during the pandemic, CEO Mark Read recently told The Financial Times.
Read has focused on simplification and debt reduction since becoming CEO, selling 60% of research firm Kantar to Bain Capital in 2019 and shrinking WPP's brands through mergers and consolidation.
A WPP spokeswoman said the company was considering acquisitions in areas such as e-commerce and marketing technology.
Jay MacDonald, CEO of investment banking firm Digital Capital Advisors, said he thought WPP would focus on US-based acquisitions in the $100 million to $300 million range.
Industry experts surveyed by Business Insider named nine companies they thought WPP might acquire; to be clear, their answers were based on speculation, and there's no indication WPP is pursuing any of these companies.
The companies are listed in alphabetical order. Unless otherwise indicated, their representatives either did not comment on the possibility of acquisitions or did not immediately respond to requests for comment.
What it does: Ansira does media-buying, analytics, email marketing and customer relationship management (CRM) work for clients such as Coca-Cola, Honda, and Purina.
Why WPP would want to buy it: WPP could use Ansira's direct mail and analytics abilities to target consumers with personalized ads.
WPP should invest in a company that helps brands maximize the efficiency of their messages at a time when consumer spending is still down, said Elgin Thompson, managing director at investment firm JMP Securities.
Spotted in Cannes: Our founders admiring our street art! Did you spot one too!? Tag us so we can see it! #canneslions #canneslions2019
A post shared byboostr (@boostrinc) on Jun 19, 2019 at 6:02am PDT
What it does: Boostr is a customer relationship management and order management cloud software company that helps businesses with ad sales and customer retention.
Why WPP would want to buy it: Boostr's software could help build WPP's CRM offering and expand beyond traditional creative and media-buying work.
C2 Ventures partner Chris Cunningham, an investor in Boostr, called it a less expensive and more user-friendly alternative to Salesforce.
Kenny Tomlin, co-founder of digital agency CourtAvenue, whose previous firm Rockfish was acquired by WPP in 2011, said CRM is a critical area for the company.
"They're associated with old-school media and big idea creative services," he said. "The new economy is about tech, speed, and hyper-personalization."
Proof of life from our recent @goodeggs campaign shoot seen in the wild! A whole lot friggin more to come!
A post shared byButchershop (@butchershopcreative) on Jan 4, 2019 at 11:40am PST
What it does: Butchershop Creative handles digital strategy, customer experience and product design work for clients such as Nike and grocery delivery startup Good Eggs.
Why WPP would want to buy it: Butchershop is known for its work for healthcare companies like insurance platform Zenefits, and it could help WPP provide better digital services to clients.
Butchershop CEO and executive creative director Trevor Hubbard said the agency is open to conversations about expanding its business.
Pink, purple and blue — check out the view! Celtra’s carpets leading the way at #Cannes2019. Thank you for an outstanding time @cannes_lions 🦁 🏖 #thisisceltra
A post shared byCeltra (@celtra.mobile) on Jul 24, 2019 at 9:04am PDT
What it does: Celtra is an independent software company that helps advertisers automate their digital display and video campaigns by using AI to test hundreds of variations on an ad.
Why WPP would want to buy it: Automation at scale could help Mark Read make his company's massive network more efficient, and Celtra could fill that role.
Kenny Tomlin, who formerly led WPP's venture capital division, said the holding company should build out its internal technology by acquiring a company that combines artificial intelligence, machine learning, and data services.
Fresh stickers #brandeverything
A post shared byInfoSum (@infosum) on Feb 11, 2019 at 4:34am PST
What it does: InfoSum is a software company that allows businesses to share first-party data, or data collected from consumers with their permission.
Why WPP would want to buy it: InfoSum caters to a data-driven ad industry as well as privacy-sensitive consumers.
Robert Webster, former data and technology director at WPP media-buying agency MediaCom, said a company like InfoSum would improve WPP media network GroupM's ability to target ads on multiple platforms including connected TV, programmatic, and digital outdoor without violating new data privacy laws.
InfoSum recently raised $15 million with backing from Upfront Ventures, AT&T, and Cannes Lions owner Ascential and hired former GroupM North America CEO Brian Lesser as executive chairman.
It's #WorldMaskWeek! In April, we announced our donation of 400,000 masks to hospitals and frontline workers in need. This week, along with other @pandemicactionnetwork partners, we'll be sharing more community health focused moments and encourage everyone to #WearAMask to prevent the spread of #COVID19.
A post shared byKlick Health (@klick.health) on Aug 10, 2020 at 8:12am PDT
What it does: The independent agency creates ad campaigns and does consulting and analytics for healthcare and pharmaceutical companies.
Why WPP would want to buy it: Healthcare has been the strongest growth area for the ad agencies because people still need to see their doctors and buy medication and health products, and healthcare is expected to be an increasing chunk of global ad spend. Some consider Klick Health one of the strongest independent agencies in its space.
A Klick Health spokeswoman said the agency has been independent for 23 years and does not plan to entertain acquisition offers.
As consumers spend more time online, artificial intelligence can enhance customer relationships in ways humans couldn't do alone. Go to the MODE/X link in bio and explore how #AI can create a more personalized, humanized user experience. #CX #UX #Personalization
A post shared byModus (@modusmade) on Jul 7, 2020 at 7:35am PDT
What it does: Modus does user experience, design, strategy, and digital transformation work for established companies like Comcast and Johnson & Johnson and startups like Hath CBD. It also develops its own products and apps.
Why WPP would want to buy it: WPP wants to compete more directly with consulting firms like Accenture and Deloitte. In June it hired former Deloitte Digital CEO Andy Main to run its agency Ogilvy, and in September it acquired French firm Velvet Consulting, which helps companies with digital customer experience.
Ana Milicevic, co-founder of consultancy Sparrow Advisers, said firms like Modus and Velvet could help WPP get work with big-name clients, such as Ford or P&G, that would otherwise turn to the likes of McKinsey or BCG to make their businesses more digital.
Modus CEO Rick Levine said the company couldn't comment on specific transactions but that it would consider offers if the right one came along.
What it does: The software company uses machine learning to help brands advertise more effectively on e-commerce platforms like Amazon and Walmart.
Why WPP would want to buy it: Buying a specialty agency, as it's done in the past, would help WPP compete as revenue from Amazon and Walmart becomes a bigger part of its business, especially among consumer packaged goods clients that have been slower to adopt new technologies.
Sarah Hofstetter, president of e-commerce analytics company Profitero, pointed to the July acquisition of Amazon specialty agency Orca Pacific by former WPP CEO Martin Sorrell's S4 Capital as an example of increased interest in the space.
"We've been approached by a number of potential acquirers but we think this is the early innings and are excited to continue to grow to build a very large and scaled technology company," said Teikametrics CEO Alasdair McLean-Foreman.
Look who showed up to the Zift offices just in time for #Halloween! Even Frank is excited about slaying ChanTech monsters. (Think someone should tell him?)
A post shared byZift Solutions (@ziftsolutions) on Oct 31, 2019 at 11:10am PDT
What it does: Zift Solutions is another software company that helps automate multi-channel email and CRM marketing campaigns.
Why WPP would want to buy it: WPP could use Zift to win more assignments from clients that don't just want creative campaigns and media-buying work.
Elgin Thompson of JMP Securities said that, like Ansira, Zift Solutions could help WPP make targeted campaigns as clients increasingly ask what return they're getting on their ad spend. This is the sort of work Mark Read oversaw as CEO of WPP's Wunderman.
Thompson said marketers are now less likely to spend big on global campaigns, so companies like Zift Solutions that focus on marketing on a regional and local level are well-positioned.
Source: Read Full Article