WPP Buys Another Shop in Fast-Growing South Africa Market

South Africa continues to be a hotbed of agency acquisition activity.

WPP’s Ogilvy & Mather, has acquired Gloo Digital Design, an award winning South African digital design agency, specializing in creative campaign solutions for all sectors across the digital media space. 

Founded in 2005, with offices in Cape Town and Johannesburg, Gloo is one of South Africa’s most awarded digital agencies and has been named Digital Agency of the Year, every year for the past seven years.

The agency said the acquisition continues WPP's strategy of developing its integrated services in fast-growing and important markets and sectors and strengthening its capabilities including digital media.

WPP's digital revenues (including associates) were well over $6 billion in 2013, representing almost 35% of the Group's total revenues of $17.3 billion. WPP has set a target of 40-45% of revenue to be derived from digital in the next five years. (By comparison, Publicis Groupe says its digital revenues will account for 50% of its top line by 2015 as a result of its proposed acquisition of  Sapient).

In South Africa, WPP (including associates) generates revenues of around $500 million and employs around 26,000 people.

Both WPP and Publicis Groupe have been acquisitive in South Africa in recent months, amid forecasts that the country will be one of the fastest-growing ad markets. ZenithOptimedia, for example, predicts that South Africa will be the eighth-fastest-growing country between 2013 and 2016.

Last month Publicis Groupe bought branding firm BrandsRock, digital shop Liquorice and Machine, which offers content marketing, PR and other services. 

Earlier in the year WPP agreed to acquire South Africa’s Quirk, which the holding company said was Africa’s largest independently owned digital marketing agency. Terms were not disclosed, but WPP said Quirk had revenues of about $13.3 million in its last fiscal year which ended in February.

And Publicis Groupe earlier bought South African media shop Applied Media Logic and as well as search agency Synergize. Last November, WPP bought strategic marketing firm Cerebra. Earlier in the year its digital firm, VML -- part of the Y&R Group -- bought a majority stake in Native, which was rebranded Native VML.

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