Dive Brief:
- In a second consolidation move from WPP agencies this month, Ogilvy's Neo unit will be absorbed into GroupM's Mindshare agency and become part of a newly formed Performance Group, MediaPost reported. Neo launched in 2006 as Ogilvy's digital media unit, and the move is expected to accelerate its growth while improving collaboration between Mindshare and Ogilvy.
- The Performance Group includes an operation called FAST (Future Adaptive Specialist Team) designed to focus on marketing through addressable channels, according to MediaPost.
- Neo's management team will join the Performance Group; Neo Global CEO Nasreen Madhany and Global Chief Operating Officer Bradley Rogers will join the Mindshare leadership team while keeping their existing roles.
Dive Insight:
At the beginning of June, GroupM announced a major portfolio restructuring that merged ad-buying agencies Maxus and MEC as a cost-savings move based on real estate, IT systems, back-office services and employees. GroupM also announced it was expanding digital-first agency Essence to include traditional media capabilities and a broader geographic footprint.
Continued consolidation with Neo comes with a backdrop of major shakeups in the traditional agency-client model as brands rethink, renegotiate and review agency relationships. There's also been a high demand for agencies to get simpler in their structure stemming from a call-to-action by P&G Chief Brand Officer Marc Pritchard in April, which might make digital advertising more transparent.
Agencies are also grappling with more brands taking marketing activities in-house, along with the encroachment of management and financial consultancies such as Accenture, Deloitte and PwC on brands' marketing business.
