GroupM merges Maxus and MEC to focus on Essence
WPP is to shake up its media agency portfolio by merging Maxus and MEC and reducing GroupM’s agencies from four to three.
The move, announced overnight in New York, is intended to reduce GroupM’s costs and allow the company to expand Essence, the digital ad-buying agency it acquired in 2015.
By merging MEC with Maxus, WPP hopes to save money on office space and IT. The holding company has set no targets for job cuts, but said it was unable to completely rule them out.
In Asia-Pacific, 15-year-old MEC is overseen from Hong Kong by Peter Vogel, who became chief executive officer in 2015. Clients in APAC markets include Colgate Palmolive and Hong Kong Airlines. The agency was the media partner Amazon Kindle’s latest campaign in China.
Peter Vogel
Meanwhile, nine-year-old Maxus has been led by CEO Ajit Varghese from Singapore since 2013.
Ajit Varghese
He was previously the managing director of Maxus South Asia.
The global merger will see the new – as yet unnamed – agency led globally by MEC boss Tim Castree. A fortnight ago, Maxus’s global boss Lindsay Pattison took on the new role of chief transformation officer across GroupM, which is WPP’s media group. GroupM’s other media agencies are Mediacom and Mindshare.
Yesterday’s announcement focused on the MEC-Maxus merger as an opportunity to invest in the growth of Essence, which has offices in Singapore, Tokyo, Shanghai and Australia in APAC.
WPP said it wanted to broaden Essence’s remit beyond digital ad buying to include more traditional media buying such as TV and outdoor in a more data-driven way, like Omnicom Media Group’s Hearts & Science.
Essence’s clients currently include Google and Visa.
WPP stated: “GroupM is committing to the expansion of Essence, its digital-first agency, by adding traditional media capabilities and a larger geographic footprint to the agency’s existing media and creative credentials. In time, Essence will also lead several key GroupM client relationships as part of this restructure.”
“We’re committed to improving our service to clients. These moves will give us greater focus, help us innovate, and improve our speed of delivery,” said Kelly Clark, Global CEO of GroupM in the statement.
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