In a year when the operating model of traditional media agencies has been increasingly challenged, two programming specialists join forces to outsmart the biggest names in the industry. This recent merger of these two independent players appears to be in response to a long overdue wake-up call among the smaller, less established companies.
The Kepler Group bought Infectious Media earlier this week for an undisclosed sum. The total number of employees in the two companies is now 400, with offices in the US, UK, Latin America and Asia.
The Infectious Media brand will remain in the UK for a short time. As the two brands work through the details of the integration, the brands expect to harmonize their respective outfits around the world. Speaking to Adweek Rick Greenberg, CEO of Kepler Group, and Martin Kelly, CEO of Infectious Media, the discussions about the sale said in mid-2019. Executives stressed that the deal represented a "growth story" with no job loss between the two companies.
The services of both companies are aimed at advertisers. According to their respective clients, Kepler Group and Infectious Media have been told that "every company really needs to build a stronger global presence" in order to better serve their needs, "said Greenberg Adweek.
"By joining forces, we can have brand new conversations with customers (including Hasbro, HSBC, PepsiCo and Uber) who work with us around the world," he added.
The redesigned Kepler Group, which operates within the kyu Collective under the Asia-based parent company Hakuhodo, will attempt to position itself in the cohort of digital-first outfits such as Jellyfish, MightyHive (part of Martin Sorrell's S4 Capital) and You & Mr. Jones. Such actors, all outside the main media industry holding groups, offer a range of services including programmatic media buying as well as advising brands on whether or not to introduce an internal model for media buying.
Infectious Media's Kelly, who will eventually assume the title of CEO of Kepler Group UK, APAC, told Adweek the outfit hopes to stand out from this cohort of tech-agnostic upstarts.
"We have never been a reseller of any particular technology," he said. "In most cases, a customer takes a certain technology with them and then we work in a certain way. We have this flexibility without an engagement model where we can work with internal teams."
Tom Denford, CEO of ID Comms Inc., a NYC-based management consultancy specializing in media and advertising, said marketers are increasingly looking for a range of agency partner services. A trend that is reflected in traditional holding groups that are making new use of their programmatic offers. “The main trend we're seeing is that advertisers are open to a variety of different agency operating models and want to work with teams and groups that are agile to adapt to their needs, rather than conforming to a rigid structure of agency groups have to, ”he said.
Nathan Woodman, CEO of consulting firm Proof and former Chief Digital Officer of Havas Media Group, explained to Adweek how smaller outfits can be a differentiator in the market, especially when compared to larger established companies in the holding group.
"These emerging holding companies (like S4) have some avenue of disruption while the traditional holding companies may resist as they cannibalize their legacy business (in residential buildings)," he said. "The newer ones are not tied to an old business model."