John St. Acquired by WPP, Will Expand Media and PR offering
March 04, 2013 | Jeromy Lloyd | Comments
This story was updated at 1:00 p.m., March 4, 2013
John St., long one of Canada’s strongest independent creative agencies and Marketing‘s 2008 Agency of the Year, has joined the WPP network.
The agency “will continue to do the kind of work that has made our clients and us unignorable for the past 12 years,” said Arthur Fleischmann, John St. president, in a release. “But now we will be able to offer services in areas that clients are asking for such as media, direct and public relations.”
Financial details of the acquisition have not been disclosed. However, according to a statement from WPP, the agency’s unaudited revenues for 2012 were approximately $14 million. The U.K.-based holding company said the acquisition “strengthens WPP’s presence in Canada.”
Fleischmann told Marketing the deal started coming together six months ago when WPP approached him. John St. had not been shopping itself for a new owner, but saw the benefits of a large-scale parent company.
“We’ve won larger clients like Kobo and Mitsubishi over the past year, and clients like that require a relatively broad and complex service offering,” he said. “We were doing really well with most of those services, but for things like media planning and buying, PR and direct response, it wasn’t feasible for us to create those specialties in-house.”
The agency has been partnering with a handful of agencies such as media house Wills&Co. to provide these services to clients. It is still free to do so where it makes sense, “but if we’re approaching a very large client, they want a matching-sized media partner.”
The Quebec market had also provided challenges to the Toronto agency, which similarly required a French-language agency partner for client pitches of national scope. After prolonged efforts to open a Montreal office didn’t come to fruition, WPP’s offer seemed even more appealing.
“We actually had a pitch we didn’t win recently because we didn’t have a solid Quebec offering,” Fleischmann said. “We were finding it very challenging to create a separate offering in Montreal. Through WPP, we’ll have some options.”
Fleischmann said it is not yet known how John St. will fit into WPP’s reporting structure. The umbrella company owns several large-scale operations in Canada, including JWT, Ogilvy, Grey and Y&R.
According to John St., no structural or management changes are in the works as a result of the acquisition.
WPP made a similar big splash in the Canadian ad world late in 2010, acquiring then independent Taxi which had revenues of almost $54 million.