All of these moves are part of a growing recognition on Madison Avenue of the role search is playing in the media and marketing mix, and on the need to better integrate search marketing as part of a greater, and more cohesive communications strategy.
"By bringing together Outrider's expertise with the existing search experience within our communication planning agencies," Rob Norman, CEO of WPP's GroupM Interaction unit stated, adding, "we are establishing a search center of excellence that provides clients of GroupM companies with cross-channel strategy and search integration in order to fully maximize their marketing programs and create more targeted engagement opportunities for consumers."
As a result of the reorganization, Outrider will become the "dedicated" global search marketing operations for all of GroupM's networks, including MindShare, Mediaedge:cia, MediaCom and Maxus, and will take the lead role in terms of integrating search into their clients' media strategies.
The reorganization is significant, because GroupM is the world's largest buyer of media, representing an estimated one-third of all media buys worldwide, but it plays a relatively tiny role in the rapidly growing field of search. In December, WPP Chairman-CEO Martin Sorrell revealed some startling statistics to illustrate that. Claiming that WPP was currently search giant Google's largest customer, Sorrell said the world's biggest buyer of media was spending just $150 million annually on the search engine. With annualized advertising revenues of about $11 billion, that means the world's largest media buyer accounts for barely more than 1% of the world's biggest search player.
As stark as those data points are, consider new data released Wednesday by online analytics firm Hitwise, which found that Google's share of the search market had climbed to 64% of all queries among U.S. Internet users in March, building on its already massive lead vs. also-rans Yahoo, Microsoft and the rest of the search marketplace.
Interpublic's acquisition of Reprise, meanwhile, signals that it also is serious about being a big player in the search market. The acquisition fills a gaping hole for Interpublic, which has no dedicated search resource previously.
Reprise, the largest independent search firm in the U.S., will exist as a stand-alone unit within IPG's fledgling Futures Marketing Group. The company's founders and managing partners Peter Hershberg and Joshua Stylman will report to Bant Breen, executive vice president-director of strategic development and innovation, IPG.
Reprise is the first company to join the Futures unit.
"This move demonstrates the importance of search marketing in the overall marketing mix," said Greg Sterling, principal, Sterling Market Intelligence. "Big agencies need to bring that expertise in-house. Reprise is a credible shop that had risen to a certain level of visibility."
While online display and brand advertising is growing at a faster rate, "search is arguably the most important single area of online advertising," Sterling said, adding that most advertisers want integrated campaigns that have multiple online and offline components.
Reprise will function as an independent company under the IPG umbrella that will work on non-IPG clients, but will also serve as a resource for IPG clients via agencies Deutsch, ID Media and Universal McCann.
MediaPost's OMMA magazine named Reprise Media Best Search Agency in 2006.
This week's moves are likely to put even more pressure on big, traditional agencies to diversify more deeply into search at a time when independent search firms already were hot--and getting hotter. aQuantive, holding company for Avenue A|Razorfish,, snapped up Go Toast in 2003. DoubleClick has Performics. Omnicom owns Resolution Media, and Aegis Group snapped up iProspect.
Did-It, 360i and iCrossing are among the declining number of SEM firms that remain independent, for now.