In his third-quarter earnings call last year, WPP CEO Martin Sorrell called the idea of consultancies threatening his holding company's turf "fake news" (a direct dig at Ad Age's reporting on the topic). But WPP is nonetheless taking a run at those consulting giants by consolidating Kantar's four global consultancies into one.
Kantar Consulting, the newly consolidated unit, will have more than 1,000 analysts and unify consumer marketing capabilities with shopper, sales and retail consulting. The rollup includes Kantar Added Value, Kantar Vermeer, Kantar Futures and Kantar Retail under global CEO Phil Smiley.
While clearly aimed at one of the biggest competitive threats to the agency holding companies, Kantar Consulting isn't really about trying to even the score with consultancies, says Beth Ann Kaminkow, North America CEO of the unit.
"It's more about getting credit for the capability we have within WPP," she says.
The move should increase Kantar's role in agency new-business pitches, she says, playing into Sorrell's fondness for "horizontality," or bringing as many pieces of the holding company as possible to bear on client accounts.
Kantar Consulting is the latest of many consolidations for WPP, which has realigned digital agencies within Wunderman and VML over the past year. But the move isn't aimed at eliminating staffing or offices, Kaminkow says, adding that Kantar Consulting plans to hire additional talent and make acquisitions. Consulting is one of the fastest-growing pieces of Kantar's business, she says.
Consolidation or no, Kantar has a long way to go before making a dent in consulting compared to what consultancies have done to marketing services. Overall, Kantar (including non-consulting businesses) has under $4 billion in global revenue—on par with the $2.6 billion to $4.4 billion that consultancy marketing-services groups such as Deloitte Digital and Accenture Interactive make annually. But Kantar Consulting has only 1,000 of Kantar's 30,000 employees, who are spread across everything from media measurement to copy testing and other research and analytics work.
Kantar is the third-largest market-research company, behind Nielsen and IMS Health, according to the AMA Gold Report, but the only research player to develop a substantial consulting business.
While Kantar gives WPP more consulting assets than Omnicom or
Interpublic, the consulting business Publicis Groupe acquired with
Sapient in 2015 is bigger, with around 4,000 people and $400
million to $500 million in annual revenue,
says Pivotal Research analyst Brian Wieser.
But it makes sense for WPP to go after more consulting, says Wieser. "Marketers are willing to pay for business transformation-related work. Agencies are clearly doing some of the work, and there seems to be opportunity for them to do more."