14 agency mergers, purges and acquisitions of 2023

The year has been filled with plenty of mergers and acquisitions and even one sudden agency shutdown. Notable independent creative shops such as Gut, Uncommon, Majority, L&C NYC, Movers + Shakers, and Burrell Communications all sold stakes to different entities. One of the year’s largest deals was Omnicom’s acquisition of e-commerce giant Flywheel, for $835 million. VML’s merger announcement also garnered plenty of industry reaction. See our Year in Review stories here Below are 14 of the most notable instances when agencies merged, were acquired or disappeared in 2023. Adam&EveDDB New York In May, DDB Worldwide merged Adam&EveNYC and DDB New York, forming a new agency operating under the name Adam&EveDDB. Caroline Winterton, most recently president of Digitas New York and Atlanta, was appointed CEO of the new entity. Alex Lubar, global president and chief operating officer of DDB Worldwide, said he and Adam&Eve’s Global Chief Creative officer Richard Brim had conversations about a merger for a few months before deciding to combine the two Omnicom Group agencies. “We really felt like there was an opportunity to bring some of the startup creative dynamism that is Adam&Eve and partner it with the scale of the operations of DDB in New York,” Lubar told Ad Age. “We felt like bringing the two together would create a super agency,” he said. “This was a chance for us to scale up quickly and bring in some new talent like Caroline.” This wasn’t the first DDB merger of the year. In February, DDB Canada merged into TBWA\Group Canada. Burrell Communications In October, Burrell Communications Group, one of the country’s most renowned Black-owned agencies, was sold to a consortium led by Black-owned private equity firm FVLCRUM Partners and Channing Johnson, a Los Angeles attorney at Loeb & Loeb, through his investment company View Park Capital. The exchange included the sale of the majority stake owned by Burrell Co-CEOs McGhee Osse and Fay Ferguson since 2004 and the 49% owned by Publicis since 1999. Financial terms of the deal were not disclosed. As part of the move, Tara DeVeaux, who also has a stake in the company, was appointed as the new CEO of the agency. “My goal is that we continue to not just excel in the Black and multicultural assignments and the way we’ve been doing for the last 52 years, but we make a strong case for why we should be considered for general market work as well,” DeVeaux said. Butchershop Butchershop, a San Francisco agency whose mantra is “beat failure,” suddenly shut its doors in May, affecting an estimated 100 employees. Several employees said the shop shuttered completely without notice and others took to LinkedIn to post about the situation. Butchershop's roster was heavily weighted with tech clients, including, according to its Ad Age Small Agency Awards submission for 2022, including brands like Okt, Ironan, Appfire and At-Bay. In the submission, the shop claimed $12 million in revenue in 2021, which it said represented a 50% increase. For 2022, it projected $30 million in revenue. In 2021, Butchershop acquired Maniak, a Mexico-based Web3 design and development shop, and opened an office in Vienna. See all of Ad Age's 2023 Creativity Award winners here CPB In the latest move to revive the once-renowned CPB, Stagwell merged three of its agencies into the shop. In April, it was reported that MMI, Vitro and Observatory would join CPB, forfeiting their brands to merge into one agency under the CPB name. The news came shortly after Gale CEO Brad Simms took on CPB’s global CEO position. As part of the move, Former MMI CEO Maggie Malek was appointed president of CPB North America, reporting to Simms. The merger built up CPB’s agency size to over 300 employees and added capabilities in brand entertainment, production, and influencer work. In 2021, Ad Age reported that the agency, which at its peak had around 1,000 employees, was down to around 40 employees. “There is a model out there that modern CEOs and CMOs are looking to work with fewer agencies and have them do more,” said Simms in April. “Bringing all these capabilities under Crispin means that Crispin can just service more of our client's business to get in front of this trend in the marketplace.” EssenceMediacom In January, EssenceMediacom, part of WPP’s media investment arm GroupM, officially launched, nine months after plans for the merger of Essence and Mediacom were announced. Jill Kelly was named CEO of EssenceMediacom U.S. The new entity formed the largest global media entity and was part of a plan to simplify GroupM’s offerings. “It's hard to say if the [EssenceMediacom] merger is strategic or another attempt at consolidation to reduce cost as WPP has done in other areas," Avi Dan, founder and CEO of Avidan Strategies said about the move in January. "It makes some sense as GroupM does not need four agencies who compete with each other—it’s too complex.” Flywheel Omnicom Group inked the largest deal in its history when it signed on to acquire Flywheel Digital, the digital commerce business of Ascential, for $835 million. The acquisition is significant on multiple levels. Flywheel has more than 2,000 employees and services more than 4,500 brands, including over half of the world’s largest 100 consumer packaged goods brands marketed by publicly owned companies. Some of the clients shared by both entities include L’Oréal, Johnson & Johnson, Mars, Philips and Clorox. The acquisition also doubles the amount of data that Omnicom has available to deliver insights and makes Omnicom one of the leaders in the e-commerce space, which is one of the biggest drivers of the agency business today. Flywheel’s name recognition in the space “especially with CPG brands” is what makes the move attractive for advertisers, Tom Denford, CEO of media and advertising consultancy ID Comms said about the move in October. “Agencies always have to be careful about adding more technology brands to their roster as it becomes logo-soup and clients can’t navigate the complexity,” Denford said. “Flywheel has high salience already with Omnicom clients, plus relationships with clients of other agencies which will prove to be the real premium of this acquisition.” The deal is expected to close during the first quarter of 2024. Gut Five years after its founding, Gut sold a majority stake of its company to global tech and digital consultancy Globant. The move was a surprise to some in the industry given Gut’s quick growth and the previous promise made by Gut’s co-founder and creative chairman Anselmo Ramos to keep the agency “independent forever.” That statement was made in 2018; the agency had since grown to nearly 500 employees and 60 clients globally with offices in Miami; Buenos Aires, Argentina; São Paulo, Toronto, Mexico City, Los Angeles, and Amsterdam. The move was made, execs said, to further the agency’s goal to become a top 5 global creative network. “The same way that our full independence was key for our first five years to get where we are today, we feel that this partnership will be key for us to get to where we need to be in five years,” Ramos said. The move also immediately gives Gut tech and digital capabilities that it didn’t have. “No matter how disruptive we want to be in the digital area, there's a lot of lack of tech and digital capabilities in Gut right now that we want to improve,” Gaston Bigio, co-founder and creative chairman of Gut. “And taking that to the next level, it's about more than just hiring digital and tech talent.” L&C NYC In June, global agency network Serviceplan Group acquired a minority stake in L&C NYC, which in the two years since its launch gained notoriety for award-winning campaigns such as “Piñatex” and “Malnutrition labels” for Dole. Along with the acquisition, the network launched Serviceplan Americas in the U.S., which along with L&C, consists of the independent agency Pereira O’Dell, which sold a minority stake to the network in 2020; media agency Mediaplus, whose clients include De’Longhi, Siemens and Zeiss; and Plan.Net, a European digital agency. The move allowed the shop to scale its business opportunities while maintaining its own P&L, according to Co-founders Gian Carlo Lanfranco and Rolando Cordova. “We know as creative people that we always try to strive to do the best work, but sometimes it's not about the people, it's about getting the assignments,” Cordova said. See all of Ad Age's 2023 Agency A-List winners here Majority WPP acquired a 30% stake in Majority, the small agency co-founded by NBA legend Shaquille O’Neal, which has made a name for itself since its launch in 2021, having been named to Ad Age’s Small Agency list in 2022 and a Standout Agency on Ad Age’s A-list this year. Last year, Majority doubled its annual revenue to $10 million. The Atlanta-based agency counts Sprite, OshKosh, Match Group, the NBA G-League, and General Motors as clients. The move allows Majority to expand the types of opportunities it will be able to work on, according to Omid Farhang, co-founder and CEO. Movers+Shakers In November, Stagwell acquired social agency Movers+Shakers, known for being one of the pioneers of TikTok marketing for brands. The agency was founded in 2016 by partners Evan Horowitz, who is also the CEO, and Geoffrey Goldberg, who is also the agency’s chief creative officer. As part of the acquisition, Movers+Shakers is set to join Stagwell’s Constellation network of agencies, which also includes 72andSunny, Instrument and The Harris Poll. The acquisition was announced during Stagwell’s quarterly financial report, where it reported third-quarter results, which included a 7% decline in revenue. Shortly after, the agency responded to claims that its co-founders were connected to NXIVM, an infamous cult. Obviously and Goat In March, VMLY&R bolstered its creator marketing chops when it acquired influencer agencies Obviously and Goat within the same week. VMLY&R Global CEO Jon Cook said the need for these types of acquisitions came as he noticed the company had a gap in the agency network’s ability to provide an influencer marketing capability at a global scale. The acquisitions were part of an ongoing trend of agencies bolstering their creator expertise as social media and influencer work become bigger asks among marketers. “This is one of the hottest areas in marketing and an area that we had some experience, but we certainly didn't have depth and any sort of specialization,” Cook said. “We could do one-off influencer marketing, but we have so many clients who have portfolios of products and services. If you look across our client base, they're all operating at, if not a national scale, they're operating at a global scale.” Uncommon In July, Havas acquired a majority stake in London shop Uncommon Creative Studio. The acquisition price was not announced, but a Havas rep told Ad Age the deal was worth “several tens of millions” of pounds—and that it valued Uncommon at more than £100 million (about $129 million) considering its projected growth plans. Since its launch in 2017, Uncommon, which was named Ad Age’s International Agency of the Year this year, has become one of the more highly regarded agencies in the industry. Its client list includes British Airways (for which it won a Grand Prix in Outdoor at the Cannes Lions Festival this year), Nike Jordan, ITV, the World Wildlife Fund, B&Q, H&M, and Formula E. Three months after the acquisition, Uncommon opened an office in New York, its first major outpost beyond London. Shortly after that, SiriusXM named Uncommon as its creative agency of record, which is the agency’s first big account in the U.S. VML WPP garnered quite a bit of industry reaction when it announced plans to merge two of its largest creative networks, VMLY&R and Wunderman Thompson. The new entity, to be called VML, will begin operating in January 2024 and will have 30,000 employees, making it what the holding company is calling the largest global creative agency. VML will be led by Jon Cook as global CEO and Mel Edwards as global president. Cook currently serves as CEO of VMLY&R and Edwards is the global CEO of Wunderman Thompson. Cook told Ad Age that the combination of the two agencies will create a stronger offering in commerce, loyalty and technology with creativity at the forefront to better compete with consultancies and other agencies. He said the merger made sense given that the shops share 80% of their respective clients, including Ford, Microsoft, Dell, Colgate-Palmolive, Nestlé and Coca-Cola Co. See our Year in Review stories here

14 agency mergers, purges and acquisitions of 2023

Featured Stories