Sponsor Content Above the Clutter with Pete Krainik
Episode Seven: Man And Machine
Brought to you by: IBM
Customer-relationship management agency Merkle has bought RKG, a search and digital marketing agency based in Charlottesville, Va. This is the Columbia, Md.-based Merkle's second digital agency acquisition this year, following the acquisition of Chicago-based creative communications agency New Control.
Merkle declined to disclose terms of the deal.
RKG, a privately-held agency with offices in Bend, Ore. and Boston, was the 15th-largest search agency in Ad Age's 2014 Agency Report. Its revenue last year was $22 million, up 47% from the year prior, according to Merkle.
Merkle plans to maintain RKG's staff of 220 and bring the executive team onto its management team.
Merkle has been trying to expand its digital capabilities for about five years, according to Craig Dempster, exec VP and digital agency group leader for Merkle. It bought search agency Impaqt in 2011 and rebranded its as Merkle Impaqt, where revenue was $38 million last year, the agency said.
With RKG, Merkle's digital agency expertise grows to 650 people, he said. "This acquisition gives us more scale," said Mr. Dempster. "It also gives us a collective digital media spend of well over $550 million."
RKG also has a "great heritage" in the retail space, with clients like Express, Urban Outfitters and Drugstore.com, Mr. Dempster said. RKG's base in Charlottesville also means that the agency can tap into the student talent at the University of Virginia, according to Mr. Dempster, who said Merkle had a similar experience with students when it acquired Pittsburgh-based Impaqt.
Merkle is the 10th largest customer relationship marketing and search agency in the U.S., according to the Ad Age Agency Report. Its 2013 worldwide revenue was $370.1 million, a 16.5% increase from the year prior, according to the Ad Age Datacenter. Merkle employed over 2,000 people before the acquisition, according to the agency.