IPG's efforts to pair data with media, e-commerce gain momentum

Dive Brief:

Interpublic Group of Companies (IPG) reported Q1 net revenue of $2.03 billion, up 2.8% from a year ago, per a press release. The company reported an organic net revenue lift of 1.9%, based on a 0.2% dip in the U.S. and increase of 6.3% internationally.
On an earnings call, CEO Philippe Krakowsky highlighted the company's Matterkind and Reprise Commerce subsidiaries, calling out the growth of the agency holding group's ability to leverage data around both media activation and e-commerce offerings. He also noted that efforts by Acxiom, Kinesso and Matterkind to deliver end-to-end data and identity solutions to IPG clients is yielding new wins and expanded assignments in several industries.
IPG's improved earnings suggest brands are taking notice of its approach to data, with executives at several companies that recently signed with its media agency UM citing data expertise as a key appeal.

Dive Insight:

IPG's return to revenue growth comes after the agency holding company saw net revenue decrease 6.5% in 2020 amid setbacks caused by the pandemic. It expects to build on this improvement as the economy returns to full strength, forecasting a full-year organic growth of 5% to 6%. CEO Krakowsky attributed the strong start to IPG's ability to evolve its offerings as the ad world continues to experience "accelerating, transformational change."

"Our ability to create marketing and media solutions that bring together outstanding creativity with the benefits of technology, and an ethical approach to data management, positions us to address higher-order business opportunities. This combination was a key driver of growth during Q1," he said in a statement.

CFO Ellen Johnson attributed the slight revenue decrease in the U.S., compared to an international revenue increase, to the pandemic's "continued pressure" on events, sports and certain project work. However, the dip is also consistent with the ongoing pressures that legacy agency holding groups like IPG face as more brands move marketing activities in-house or to specialty shops.

As for growth, Krakowsky also called out two company units that help IPG leverage data around media buying and e-commerce: Matterkind, which customizes addressable media activation at scale, and Reprise Commerce, which works to deliver insight, content and analytics around e-commerce. These two growth areas will likely remain key for IPG as advertisers look to reach consumers across an increasingly fragmented media landscape, while also tapping into e-commerce that has accelerated during the pandemic.

That type of offering has been central to recent client wins for the company. Both Enterprise Holdings and Behr Paint this month named IPG Mediabrands network UM as agency of record, citing UM's data-driven capabilities to help brands connect with consumers and drive sales. In kind, Reprise Commerce this month landed its first direct U.S. client in DeMert Brands, the marketer of the Not Your Mother's brand of haircare products. These moves underscore the need for brands to better leverage their data to drive marketing, especially as the privacy landscape tightens amid legal changes and moves by tech giants Google and Apple.

"We've been developing a data and tech infrastructure that underpins the full portfolio of our agencies and [delivers] solutions to a broad range of business problems through what we call the open architecture model. All of our major clients are seeing the benefits of this integrated approach," Krakowsky said.

To this end, he detailed how IPG martech companies Acxiom, Kinesso and Matterkind are working together to bring end-to-end data and identity solutions to clients, an approach that has yielded new clients and expanded assignments in the telecom, auto, healthcare and financial services sectors. Kinesso, with Acxiom, deployed its identity solution with "half a dozen" large clients and expanded its data integrations with other platforms and ad-tech companies.

The CEO also noted IPG's commitments to fostering equity and inclusion, as well as other components of the environmental, social and corporate (ESG) spectrum, such as data stewardship, digital media and brand safety practices. To those ends, IPG Mediabrands in March hosted its first upfront focused on equity in an attempt to increase the visibility of Black-owned and -targeted media. The media arm of the agency giant also inked a deal with TikTok to deepen brand clients' access to creators on the increasingly central video platform.