m&a in advertising, marketing services & marketing technologies … · 2018-04-16 · next...
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McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing Technologies
M&A in Advertising, Marketing Services & Marketing Technologies
[Q1 2018]
mccrackenap.com New York - Minneapolis - Sao Paulo
McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing TechnologiesQ1 2018
Company Q1 2018 Deals
2017 Deals
2016 Deals
2015 Deals
3 30 33 40
4 29 36 26
2 18 10 7
2 10 4 9
0 9 1 -
0 10 10 19
0 6 8 4
2 1 4 9
0 3 - -
1 3 - -
0 5 3 4
0 3 - -
0 1 3 -
0 1 2 -
0 1 7 1
2 - - -
On the consultancy groups front, there was
decidedly less action than a year ago when
Accenture was busy closing 4 deals in the first
quarter -- this year there’s been only 2 -- the
acquisition of Mackevision a 3-D & immersive
content shop and Meredith’s digital agency -
MXM. Meanwhile, Acxiom added a B2B marketing
intel shop - Pacific Data Partners; EY bought 2
shops, digital design agency, Citizen and
consulting firm - Sonoma Partners.
A Puzzle
We tracked 94 relevant transactions in Q1 of 2018, that's a huge 40% increase over the same period a year ago
-- so why does it feel like there’s less is going on M&A-wise in Marcoms? Yes, there’s been plenty of activity
from the Agency Networks, but more about shuffling resources and reorganizing verticals; with one notable
exception -- the Dentsu Aegis Network seem as busy as ever, matching their year ago pace with 4 acquisitions
in the first quarter: brand and design agency - Character; AI specialist - Data Artist; marketing communication
agency - Red8 Group; and promotions shop - HelloWorld.
Major Buyers
Overall, deal count in Q1 was up significantly;
transactions were simply spread over a more
diverse group of buyers – probably a good thing.
And William Morris Endeavor (WME)
announced 2 sizable acquisitions, branding agency
- 160over90; and streaming company - NeuLion.
Havas completed two transactions: PR shop -
Deekeling Arndt Advisors and healthcare
consultants - M&C Consultancy.
Omnicom Health Group also completed 2
transactions, patient engagement agency – Snow
Companies; and healthcare agency – Elsevier’s
Pharma Communications Group.
[Q1 2018 overview]
WPP closed 10 deals in the same period last year, but for Q1 2018 completed only 3 transactions: The Glitch, a
digital agency (for Group M); Mash Strategy brand consultants (for Kantar); and the creative agency –
Bomtempo, Ahahory & Raiha, (acquired for Ogilvy Portugal).
McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing TechnologiesQ1 2018
[Q1 2018 overview]
Consolidation as a Strategy
While the big agency networks have been closing fewer deals of late (exception Dentsu Aegis), they have been
busy... After years of acquiring agency brands, the often predicted but now accelerating trend at the big
networks is that of combining agency brands into logical and more efficient groups that make sense in an era
of downward pressure on agency margins.
Here are just a few of the stories about consolidation within WPP and Omnicom in Q1.
Five WPP design businesses consolidated under new Superunion brand
Five long established WPP design consultancies have been consolidated and relaunched as a single new brand
called Superunion. The plan to bring the businesses together was first announced last September.
Source: Fintellect January 25, 2018
WPP Makes Another Major Consolidation Move
Over the past year WPP has been busy consolidating some of its ad agency operations. While that effort may
not be finished, the holding company has now merged two of its big PR shops-- Burson-Marsteller and Cohn &
Wolfe -- to create Burson Cohn & Wolfe (BCW).
More: Source: MediaPost February 27, 2018
WPP Results Show Why Agencies Are Merging, Not Dying
The media agency model has received more premature obituaries than email marketing, and that's quite a few.
Today it's tempting to dust off the old arguments and give them another airing, given that WPP is flatlining
and merging agencies like an overactive wedding planner.
More: Source: MediaPost March 1, 2018
Omnicom to merge Rocket with Hearts & Science in UK
Omnicom is dropping Rocket as a standalone media agency in the UK and merging it with Hearts & Science in
the latest consolidation in the agency sector. 'This is a growth story,' Philippa Brown, UK CEO of Omnicom
Media Group, said.
More: Source: Campaign, January 15, 2018
McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing TechnologiesQ1 2018
[Q1 2018 overview]
Some Interesting Stories You May Have Missed
Consultants Narrow the M&A Gap with Holding Companies in 2017
While M&A in the marketing services industry was generally flat last year, consultants doubled down on their
bets in the sector while the agency holding companies were significantly less active compared to 2016,
according to an analysis by independent consulting firm R3.
Based on the firm’s analysis, consultants such as Accenture, Deloitte, IBM, KPMG and McKinsey invested $1.2
billion in agency acquisitions in 2017, a 134% increase over 2016. By contrast, investments by agency holding
groups including WPP, Dentsu, Omnicom, Interpublic and Publicis declined by 46% to $1.8 billion.
More: Source: MediaPost January 22, 2018
Marketers Face Loss of Power, Influence as Big Consultants Seek Agency Acquisitions
Despite a windfall of advertising spending in 2017, particularly during the holiday season, the big advertising
groups failed to live up to investor expectations. The proof is in the results: WPP’s share price was down 29%
on the year. Publicis took a 12% hit. Interpublic saw an 11% drop while Omnicom fell 10%. As a consequence,
advertising groups have been looking mighty attractive to prospective buyers...
More: Source: MediaPost February 20, 2018
Bean Counters' Nightmare: Most Agencies Over-Service Accounts
Well, here’s a shocker: Function Point, a purveyor of project management software for creative and marketing
shops, has co-sponsored a survey/study (along with the Agency Management Institute) that found three-
quarters of respondents said they saw an increase in productivity after implementing project-management
software.
More: Source: MediaPost February 20, 2018
Agencies are Killing Their Own Productivity
Cast a businessperson’s eye toward the new agency productivity report from the Agency Management Institute
(AMI), and you’ll be struck by agencies’ toxic attitude. Clients make us over time and budget on half our work,
respondents said, because they don’t give us complete briefs, suck up our time, and constantly make last-
minute changes. Although we admit our account people are nervous about making the client mad by imposing
deadlines or surfacing conflicts.
More: MediaPost February 28, 2018
See Below for the Full List of Q1 2018 Deals.
BUYER TARGET SECTOR (TARGET) VALUATION
Ascential Clavis Insight e-commerce
Blackstone Group (consortium)
Thomson Reuters Financial Ntechnology Majority Stake
Cision Prime Research Earned Media Tracker
Conde Naste Lighthouse Datalab Data Solutions
CreativeDrive Pia Agency Creative Content Agency
Dentsu's Merkle HelloWorld Promotions Agency
Diversis Capital Marketron Media Software Company
Drumroll 2mrw Content Marketing
Ernst & Young (EY) Citizen Digital Design
Finn Partners Brighter Group PR and Marketing Agency
Flashtalking Spongecell Dynamic Creative Optimization (DCO)
Frontier Capital MediaRadar Ad Intelliegence Company Investment
GoDaddy Main Street Hub Social Media Management
$125 Million
Havas Group Deekeling Arndt Advisors (DAA) Public Relations
Highwire Public Relations Inner Circle Labs Public Relations
Impact XM Endo Networks Inc. Software Platform
Industrial Color Studios Click 3X Film and Post Production Studio
Informa Conference Organizer UBM $5.2 Billion
InMobi AerServ Mobile Monetization Platform
$90 Million
Marlin Equity Partners Talkwater Analytics Majority Stake
Marsh & McLennan's Oliver Wyman
Draw Digital Transformation
Millpond Equity Partners BrandRep Digital Marketing
Phoenix Marketing Nielsen TV Brand Effect (TVBE) Performance Metrics
SAP CallidusCloud Front Office & Learning Solutions
$2.4 Billion
Spencer Technologies Certified Retail Solutions IT Solutions
Vested Templars Communications Communications Agency
Viacom Whosay Influencer Ad Agency
West Corp Nasdaq's PR Solutions and Digital Media Services
Public Relations and Digital Media
$335 Million
William Morris Endeavor (WME)
160over90 Branding Agency $200 Million
WPP's Kantar Mash Strategy Ltd. Brand Consulting
WPP"s Ogilvy & Mather Portugal
Bomtempo, Anahory & Ralha – Serviços Criativos (BAR)
Creative Agency
Zeta Global Visto Software Enterprise Ad Hub Investment
Q1 2018 deals
For more information about individual transactions, click on the buyer’s name.
JAN
UA
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Q1 2018Continued »
McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing Technologies
BUYER TARGET SECTOR (TARGET) VALUATION
Accenture Digital Mackevision 3-D & Immersive Product Content
Acxiom's Liveramp Pacific Data Partners B2B Marketing Intelligence
AND Agency Greenwich Associates uLC Customer Experience
Axel Springer Magic Leap Technology Investment
Bazaarvoice AddStructure Search & Discovery Apps
Causeway Media Partners QuintEvents Event Hospitality Strategic Investment
Dentsu Aegis Character Brand & Design Agency
Dentsu Aegis Data Artist, Inc. AI Specialist
Eastport Holdings Fahlgren Mortine Integrated Marketing
Evoke Group AboveNation Media Media Strategy & Buying
Forbes The Memo Online Publication
Frontier Strategy Group Ducker Worldwide Research & Consulting
Google Logmeln's Xively IoT Platform
Kite Hill Cutler PR Public Relations
Main Street Capital DMS Holdco Omni-Channel Direct Marketing Services
Investment
Next 15 Brandwidth Group Digital Agency £6.2 Million
Nielson Ebiquity's AdIntel Unit Analytics Consultancy £26m
Norwest Equity Partners (NEP)
Avtex Customer Experience
Omnicom Health Group Snow Companies Patient Engagement Agency
Pulsepoint Vitality Ad Lab Advertising Exchange (Healthcare)
Quad/Graphics Ivie & Associates Marketing Services
Rhythmone PLC Yume, Inc. Platform
Vector Media Direct Media USA Municipal Transit Advertising
Viacom Vidcon Annual Online Video Conference
Walmart Spatialand Virtual Reality
WPP's Group M The Glitch Digital Agency
3D Digital Buyback from Harte Hanks Digital Agency Independent Buyback
Accenture Interactive Meredith Corporation's MXM Digital Agency
Apple Texture Digital Magazine Distributor
Bell Media Carted Platform
Brillio Comity Designs Cloud & Mobile Solutions
CreativeDrive Decora Augmented Reality & Immersive Content
$100 Million
Q1 2018 deals
For more information about individual transactions, click on the buyer’s name.
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UA
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Q1 2018Continued »
McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing Technologies
MA
RC
H
BUYER TARGET SECTOR (TARGET) VALUATION
Dentsu Aegis Red8 Group Marketing Communications 100% stake
EPAM Continuum Innovation Design
Ernst & Young (EY) Sonoma Partners Consulting Firm
Google Tenor Search Company
Growth Catalyst Partner's Opus Agency
CRG Events Event Management
Havas Group's Havas Health & You
M&C Consultancy Healthcare Market Access
ICM Partners Just For Laughs Group Live Events
Industrial Color Studios Invodo Ecommerce Video Production
Investcorp ICR Communications Agency
Marsh & McLennan's Oliver Wyman 8works Design Thinking Consultancy
Meltwater Datasift Data & Analytics Platform
MMGY Global Hills Balfour PR & Marketing Communications
Nike Zodiak Analytics
Omnicom Health Group Elsevier's Pharma Communications Group
Healthcare Communications
Pandora AdsWizz Digital Audio Advertising $145 Million
Penske Media SheKnows Digital Publisher
Public Investment Fund (PIF)
Endeavor Talent & Event Managers $400 Million Stake
Quad/Graphics Rise Interactive Digital Marketing Majority Stake
Salesforce CloudCraze e-commerce
Salesforce Mulesoft Software $6.5 Billion
Shamrock Capital wPromote Digital Marketing Minority Investment
Snap, Inc. PlayCanvas AR/VR
Splice Indaba Music Online Music Community
Springbox nFusion Analytics & Content
Valassis The Flyer Direct Mail Magazine
Virtusa eTouch Digital Engineering
Vision Critical Communications Inc
Aida Softward Corp. (Certain Assets)
AI Specialist
WeWork Conductor SEO Marketing
William Morris Endeavor (WME)
NeuLion Streaming Company $250 Million
You & Mr. Jones Gravity Road Content Marketing 51% Stake
Q1 Total = 94 deals
Q1 2018 McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing Technologies
MA
RC
HQ1 2018 deals
For more information about individual transactions, click on the buyer’s name.
[Contact]
McCracken Advisory Partners
mccrackenap.com
Keith McCracken
Minneapolis
CEO & Co-Founder
+1 952 922 8140
Ronnie Cohen
New York
Co-Founder
+1 212 941 6498
Brian Harris
New York
Senior Advisor
+1 917 968 0765
Rogerio Campos
Sao Paulo
Regional Partner, Brazil
+55 11 984667000
Q1 2018 McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing Technologies
McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing TechnologiesQ1 2018
McCracken AP Transactions
McCracken Advisory Partners - M&A in Advertising, Marketing Services & Marketing Technologies