Ad holding company WPP is continuing its consolidation spree with Wunderman Thompson network absorbing 3 more agencies

Mark Read WPP

  • The world’s largest ad holding company WPP will continue its
    merger and consolidation strategy with global network Wunderman
    Thompson absorbing digital agencies Possible, Mirum, and
    iStrategyLabs.
  • Sources told Business Insider that the three agencies, which
    previously operated under the Wunderman Thompson umbrella, would
    become one with that organization and would eventually drop their
    names.
  • These organizations collectively employ several thousand people
    across dozens of countries. It is unclear how many jobs would be
    affected.
  • The consolidation marks the latest step in WPP CEO Mark Read’s
    plan to return the company to growth amid headwinds caused by
    client budget cuts and a large-scale shift away from traditional
    advertising channels.

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WPP will continue its year-old restructuring spree by absorbing
three agencies into the Wunderman Thompson organization that was
created by the 2018 union of Wunderman and J. Walter Thompson.

Two high-level sources with direct knowledge of the matter said
the digital agencies Possible, Mirum, and iStrategyLabs would
become one with Wunderman Thompson, with each eventually dropping
its name.

Possible is the best known of the three, with clients including
Microsoft, AT&T, and Volkswagen.

The move marks another step in WPP CEO Mark Read’s plans to
streamline the world’s largest ad holding company through a
self-described “radical evolution” strategy.

It also shows how the company is attempting to return to growth
in its largest region after a 2018 that saw stock prices drop by
nearly 50% due to the loss of major accounts like American Express
and a general move by marketers to slash overall budgets and shift
spending from print and broadcast TV to digital platforms.

Spokespeople for WPP referred Business Insider to Wunderman
Thompson, who had not provided a comment at the time of
publication.

The move marks another step in WPP’s efforts to consolidate digital
operations

The three agencies had already become part of the same network
following the
merger of digital firm Wunderman and J. Walter Thompson
, the
world’s oldest ad agency. The same two sources said they expected
that the organizations would soon function as a single business
under a shared profit and loss statement in North America and that
all three would eventually drop their names.

One source said details of the new arrangement haven’t been
finalized but that they should be complete by the end of the
calendar year.

WPP had already taken a series of incremental steps toward
consolidation in recent months by
merging the Seattle offices
of Possible and creative agency
Cole & Weber with Wunderman Thompson in March and
dropping the Possible name in the UK
the following month to
combine that organization with Mirum.

Back in 2011, the holding company
combined four existing digital agencies
to form Possible. JWT
bought Digiteria in 2010 and merged it with 10 other digital
agencies around the world to create Mirum in 2015 before acquiring
Washington D.C.-based iStrategyLabs the following year.

According to the most recent numbers from LinkedIn and WPP’s website, the three
agencies involved in this move employ several thousand people
across dozens of countries. Business Insider was unable to learn
how many jobs would be affected.

CEO Mark Read continues his three-year plan to return to growth by
streamlining agency services

Mark Read laid out his three-year strategy for WPP in an
investors day presentation in December 2018, saying the company

would cut 3,500 jobs
and hire 1,000 new people before 2021
while adding creative leadership and data-based service offerings.
He also said not to expect any more large-scale merger
announcements.

The company has made big leadership changes, though. Earlier
this week,
Business Insider reported first that Tim Castree
, North
American CEO of media buying network GroupM, would step down after
less than a year in the job and that global CEO Christian Juhl
would temporarily take his place.

WPP’s recent agency mergers and consolidation moves began in
mid-2017, when Possible became part of the Wunderman network while
retaining its own brand. Mark Read was CEO of Wunderman at the
time.

His first major move upon taking over the holding company the
following September was to merge digital agency VML and traditional
creative shop Y&R to create VMLY&R.

The company reported better results to investors last month
after a series of punishing quarters, with organic revenue rising
0.7% when accounting for the sale of a majority stake in market
research firm Kantar Media.

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Ad holding company WPP is continuing its consolidation spree with Wunderman Thompson network absorbing 3 more agencies