The advertising giant WPP continues its strategy to build up its digital business through acquisitions: today Possible Worldwide, a WPP -owned digital agency that has strong operations in emerging markets, announced that it has purchased Fortune Cookie, a 190-person, UK-based firm with operations also in Poland, the U.S. and Australia. Financial terms of the deal were not disclosed.
The deal follows closely on the heels of WPP taking control of AKQA in June, and is part of company’s ambition to have 40% of its revenues coming from digital in the next five years.
Possible Worldwide has been shaping itself up as a digital marketing agency with particularly strong focus on emerging markets. It has operations in Brazil, India and China as well as Eastern Europe, with offices in Russia, Hungary, Romania and Serbia.
Now that will be extended with Fortune Cookie’s existing operations. “The deal gives us a greatly expanded footprint in the UK market and builds upon our strength in Eastern Europe with a major new office in Poland,” noted Shane Atchison, global CEO of Possible Worldwide, in a statement.
With the deal comes contracts with existing Fortune Cookie clients including Canon, AEGON, NetJets and BP, which will now get added to Possible’s own client list, which includes AT&T, Barclays, Comcast, The Bill & Melinda Gates Foundation, Procter & Gamble, Nokia, Microsoft, Mazda and Starwood Hotels and Resorts Worldwide.
WPP has been making a strong effort up to now on its digital business organically. In 2011 around a quarter of its revenues came from digital operations: $4.8 billion from total revenues of $16 billion. But to reach its goal of having 40% of its business being digital, it has been making some strategic investments and acquisitions. In addition to Fortune Cookie and AKQA, earlier this year it also led a $10 million round of funding in mySupermarket, an online/shopping aggregation service.
The focus on emerging markets is one that WPP’s CEO Martin Sorrell has long been emphasizing. “I think their importance continues to be underestimated,” he said back in June 2011, particularly as more mature markets continue to see economic slowdown. “In that context the BRICs and next 11 as engines of growth for our business become more and more important.”
WPP has made other acquisitions and investments that also help focus its presence in developing countries. In June 2012, its JWT operating unit took a majority stake in Hungama Digital Services; in July 2012, its subsidiary Millward Brown took a stake in Chilean market research firm Cadem; back in January 2012 its Ogilvy unit took a 33% stake in DTDigital in Australia for more Asia Pacific focus.
Fortune Cookie’s CEO Justin Cooke will now become CEO of Possible Worldwide UK.