Dive Brief:

• WPP's GroupM announced a trio of agency mergers that seek to simplify its operations and accelerate innovation and growth for clients, according to a press release.
• The new EssenceMediacom group combines Essence's digital and data-driven offering with MediaCom's multichannel audience planning and strategic media expertise. The operational model is already being used by Google, Mars and NBCUniversal. In addition, Finecast, Xaxis and GroupM Services will form GroupM Nexus and Mindshare will integrate with global performance agency Neo.
• The moves by WPP's media investment group come as the agency holding company grew at its fastest pace in 20 years, boosted by investment in experience, commerce and technology by brands looking for agencies that can better integrate those functions.

Dive Insight:

GroupM is streamlining its subsidiaries as it looks to build on growth spurred by the continued consumer shift to digital and a rebounding ad market that has boosted ad holding groups, including parent WPP. The new combinations boast the type of global scale that has helped traditional agency networks win and retain major ad accounts after previously losing ground to challenger agencies and consultancies.

"Today’s global marketers need both agility and scale from their agency partners to properly support their businesses across international markets," said Kyoko Matsushita, who is leaving Essence after eight years to become WPP’s CEO in Japan, in a statement.

EssenceMediacom will launch in 2023 with 10,000 employees across 125 offices, with MediaCom global CEO Nick Lawson serving as global chief of the new company, which combines two growing parts of GroupM's offering. MediaCom was first in the industry for new business wins in 2021 with $2.87 billion in new billings attributed to wins, per COMvergence data cited by GroupM. The combined structure is already being used by major marketers Google, Mars and NBCUniversal, and brings together strategy, brand-building and digital expertise — a key selling point for clients.

"Digitization is changing how consumers live, play and shop and is therefore reshaping our industry at speed. The convergence of media, entertainment and commerce in digital environments is enabling us to build brands and convert to sales in the same place. But in order to provide consumers with an effortless end-to-end experience, as an industry we must utilize new skills and expertise, and harness new ways of working," Luis Di Como, executive vice president for global media at Unilever, said in a statement about the mergers. Mindshare retained most of Unilever's $3.3 billion media business in a pitch that wrapped last year.

Similar to EssenceMediacom, GroupM Nexus will launch as a global organization with 9,000 digital and technology practitioners — including experts in digital channels and platforms, search, social, programmatic, AI, cross-channel optimization and data-driven technologies and software — that are collectively responsible for more than 2 million campaigns each year. Along with bringing together Finecast, Xaxis and GroupM Services, GroupM Nexus will use a new cross-channel performance platform and international delivery hubs.

Rounding out the announcement is the integration of Neo's 1,200 digital-first performance experts and consultants under the Mindshare brand, which already boasts 10,000 media specialists. Mindshare notched $2 billion in newly won and retained client revenue in 2021, making it third in global new business for the year, per COMvergence.

The moves by GroupM come on the heels of WPP launching Everymile, a fully managed service that provides brands with an outsourced direct-to-consumer e-commerce solution, as the company looks to build on growth in the surging sector.