ORIGINALLY PUBLISHED ON VENTUREBURN
The big news in the digital agency space this week is the acquisition of Gloo by Ogilvy & Mather. It’s a massive coup for the WPP-owned communications agency. Getting your hands on an agency that has been named Digital Agency of the Year every year for the past seven years by Financial Mail’s AdFocus Awards is, after all, no small feat. If the people at the heart of the deal are to be believed though, this is no ordinary acquisition.
In fact, Gloo founder Pete Case isn’t really all that comfortable with anyone calling it an acquisition. “We’re talking about it as a merger,” he told us in an exclusive interview. “This is not typical of the last six acquisitions we’ve seen in the South African digital agency space,” he said. “I’m not sitting here on some kind of run-out strategy. This is us getting deeper”.
Indeed, Case told us that one of his conditions for allowing the deal to go through was that he be allowed to stay on in a steering role in the new business that’s resulted from the deal.
On that front, Case will take up a central role in Ogilvy & Mather SA as co-Chief Creative Officer. Other senior employees at Gloo Johannesburg will take up positions across the agency and its digital and CRM business, OgilvyOne Worldwide SA.
According to Case, the deal is the logical extension of Gloo’s long history of collaboration with other agencies. Seeing how many companies were within the Ogilvy group (which are allowed to operate in a near-autonomous fashion), Case told us, was one of the things that made it a desirable acquisition partner.
“There’s an amazing energy within the group,” he said. “The future is a collaborative space and with Ogilvy, everyone can compete and collaborate, and it’s definitely the group with the most exciting companies within it.”
That much is reflected in the way the deal has been structured. On completion of the deal, Ogilvy & Mather plans to physically absorb Gloo into its Johannesburg office which will form part of an internal technology and innovation hub to the 15 companies within the Ogilvy & Mather SA Group.
Gloo Cape Town however, will continue to operate as an independent and separate digital specialist, with the added resources of the groups’ international innovations lab to accelerate its focus on leading-edge technology and innovation.
A long-time coming
As Ventureburn sources reported, the deal has been in the works for some time. That said, Case did tell us that Gloo did approach other groups for acquisition.
Too many of them however offered the kind of deals you usually see from agency founders looking to exit their business to start something new, or to offload a failing business onto someone else.
“We spoke to loads of other groups,” he said, “None of them showed the investment Ogilvy & Mather did”.
“We’re doing the best work we’ve ever done,” he added, suggesting that Ogilvy was the partner that would allow it to keep growing.
“Our staff are looking for growth,” Case told us, adding that “we felt we could learn the most from Ogilvy”.
Learning has always been something that Gloo’s been big on. One of its nicknames for itself is “Glooniversity”, owing to the large number of former employees who’ve gone on to either take up senior positions at other leading South African digital agencies or start their own digital agencies.
If Case has his way, it looks like the number of staff doing that learning won’t shrink either. “We’re not looking to shrink our team size,” he said during the interview. Indeed, not having to give up staff was one of his conditions for allowing the deal to go through.
“As a business owner,” he told us, “you look at your employees and think ‘Christ! how can I give them more?’”.
“We already look after our staff pretty well,” he said, adding that the deal would only allow the company to look after them better.
The future of the agency
Another reason Case felt comfortable with Gloo being absorbed into the Ogilvy group, he told us, was because of Ogilvy & Mather’s approach to clients. It’s almost an agency within an agency feel, with people from different specialisations coming together to form a team that looks after a single client.
“Clients want something unique that isn’t an agency,” he told us, suggesting that Ogilvy was one of the few groups that could provide that.
And while that sounds very on-trend, there is still work to be done now.
“It’s business as usual in many aspects,” Case told us. In fact, Gloo and Ogilvy One, the digital customer engagement specialist within the Ogilvy group, have already been doing work together.
Together with RedWorks, an integrated communications and consulting agency, they’ve won new business, including Sun International and Castrol. Of course, after having a few common clients helped but, as Case noted Gloo still has a “responsibility as an agency to build briefs” regardless of any acquisition.
Looking forward, Case says it’s “all about obsessiveness with work” from both sides. There are also plans to set up offices across the rest of Africa, leveraging off Ogilvy’s network.
As to the one thing Case would like to have given up in the wake of the acquisition? Simple: “The 48 hour days.”
ABOUT THE AUTHOR
Stuart Thomas is a product of Rhodes University and a senior reporter at Ventureburn. Whilst completing his Bachelors in Journalism, Politics and English, he realised he was a bit of a geek, albeit one who isn’t afraid of the sun. An honors in English at the same institution failed to curb this. An MA in South African Literature, only made it worse as it gave him even more hours to spend in front of a computer screen. He hopes to go viral one day.