IPG Mediabrands has merged Kinesso, Reprise and Matterkind into one performance marketing unit as part of a broader simplification at the network that now operates under one P&L.
The freshly combined unit will be called Kinesso and will build technology to improve the network’s productivity and help agency brands within IPG Mediabrands, including UM, Initiative and Mediahub, service clients.
Jarrod Martin, who has been appointed to lead the unit as global CEO, said Kinesso will act as an “ingredient” to power IPG Mediabrands solutions, rather than operate as a separate specialist group.
Kinesso, Reprise and Matterkind had previously worked “in isolation” and were tasked with generating their own income, but this proved to be cumbersome and complicated for clients.
“The goal is to simplify in order to be more sophisticated,” said Eileen Kiernan, global CEO of IPG Mediabrands. “You cannot drive transformation, you cannot move fast, you cannot innovate on top of a complex organisation. Through simplicity, through common sense, we create a runway towards transformation and speed and agility.”
The merger has resulted in some redundancies though IPG said it amounted to “less than 1%” of the organisation and that there has been no geographic consolidation.
Martin said it was not designed as a cost-cutting exercise and outlined plans to invest in staff with skills in business strategy and artificial intelligence (AI)—especially those who can use AI to write code.
“The overall goal is for us to be able to remove some of this manual, joyless work out of the system. It isn’t in service of taking our employee base down, it is making those employees more productive and valuable to our clients,” said Martin.
The restructure comes just months after IPG lost several key executives from its specialist digital units, including Kinesso global CEO Arun Kumar, chief operating officer Ian Johnson and chief product officer Kimber Robbins, as well as Matterkind US CEO Nancy Hall. The departures were first reported by Insider.
Martin was one of the few remaining executives. He was appointed global CEO of Reprise in April last year.
Kiernan said the decision to retire the Reprise and Matterkind brands was made last year “as opposed to a reaction to the marketplace.”
Though she acknowledged that the organization has “gone through a rough few years” as it has navigated pullbacks in client spend due to the pandemic and recession concerns. Parent company Interpublic Group posted an organic revenue decline of 1.7% in Q2 this year, which it blamed on pullbacks in the technology and telecom sectors and underperformance at its digital agencies.
She said the simplified Kinesso will help IPG better service clients who are demanding greater flexibility this year.
“The most dominant thing that we're being asked to negotiate with this year is flexibility,” she said. “Clients want the ability to, across ecosystems, move budgets, change levels at the speed of their business—not only because they want to be able to get out of an uncertain situation if there's a brand safety issue, they also want to be able to optimise their performance.”
Clients are no longer allocating budgets on an annual basis but rather on a quarterly or monthly basis, she added.
“That demand for flexibility has led to an increase in digital share of total [media spend], but also an increase in algorithmic buying share of digital,” Martin added. “We're looking to invest client dollars in platforms where we can automatically optimize in real-time against the outcomes that we're trying to generate, as opposed to making a big bet and letting it ride for X amount of months.”
IPG engaged third-party consultants to help it design the new IPG Mediabrands structure.
“It wasn't simply just bringing three entities together, it was figuring out what's our ideal process and structure to support that,” said Martin.
The ambition is for IPG Mediabrands to operate as “one shared client marketplace,” Kiernan described, which explains why it is beginning to pitch as a network.
In February, IPG Mediabrands won Geico’s $1.4 billion media account in a rare instance of a network-wide win.
The move comes hot on the heels of a similar reorganisation at rival media network GroupM, which this week revealed plans to sunset its Xaxis, Finecast and Sightline brands to form a unified performance marketing division under Nexus.