Razorfish CEO to Set New Digital Course for Publicis in Wake of Lang Departure
With Laura Lang on the way out, Publicis Groupe is taking Digitas's open global-CEO spot as an opportunity to reevaluate -- and potentially restructure -- all its digital assets across the entire holding company, including its very crowded stable of digital agencies collected acquisition after acquisition over the past five years.
That means no global CEO to replace Ms. Lang at Digitas for the time being. Instead, Bob Lord, global CEO of sibling agency Razorfish, will set a new digital course for Publicis Groupe atop a new committee, dubbed the Digital Transformation Team, to look at how the third-largest ad-agency holding company's digital assets, from pure plays like Razorfish and Digitas to digital departments within traditional agencies such as Leo Burnett and Saatchi & Saatchi, will be structured moving forward. Publicis has arguably been the most vocal of its peers, which include WPP and Omnicom Group, in preparing for a more digital world and, in step, the most aggressive buyer of digital shops in recent years.
Mr. Lord said the committee's task is to figure out "what else ... we have across the network that we can leverage more broadly. . . . By the end of the first-quarter, we need to figure out a product and service strategy for the entire Publicis Groupe ."
As for Digitas' day-to-day operations, CEO of North America Colin Kinsella and International CEO Stephan Beringer will handle the day-to-day and report to Mr. Lord.
This will be a major referendum on a digital umbrella unit Publicis calls Vivaki. Publicis created Vivaki to house digital and media agencies in 2008 to cull better bulk-rates and research from digital publishers and to develop better tools to measure digital ads. When it was formed, the unit housed Digitas, which Publicis had acquired for $1.3 billion the year prior; Denuo, a home-grown innovations unit; and media agencies Starcom Mediavest Groupe and Zenith Optimedia, which also handled digital ad buying.
Since, a slew of new shops have been crammed under the Vivaki umbrella. Under the mandate of Publicis Groupe CEO Maurice Levy to cull 35% of the agency holding company's revenue from digital services, the company next acquired Mr. Lord's Razorfish for $530 million plus media commitments to seller Microsoft.
Then came Rosetta for $575 million. That agency doesn't report through the Vivaki structure, and it is unclear how this agency, which looks a lot like its siblings under that umbrella, will emerge from the transformation unscathed.
Most recently, Publicis took a majority stake in social-media agency Big Fuel, even though all of its digital shops already have their own social-media departments. Big Fuel leadership will also report to Mr. Lord.
To Mr. Lord's credit, he has experience knitting together and reformatting agencies at Razorfish. He joined the agency in 2000 as chief operating officer. Since then, Razorfish has been acquired many times over, rebranded, spun off and restructured.
Could Publicis digital transformation find its two behemoths mashed together to form a new Razortas or Digifish? Unlikely, given client conflict. However, the distinction between the two agencies internationally is already becoming harder to discern. Outside the U.S., where Digitas or Razorfish only made 31% and 21% of global revenue last year respectively, the two agencies already employ a "two-door" strategy so that global clients for either agency can benefit from its siblings' footprint.