Publicis Groupe just made another major acquisition.
Mere months after acquiring data company Epsilon for $4.4 billion, the holding company has announced the acquisition of full-service independent marketing agency Rauxa.
“With the acquisition of Rauxa, Publicis Groupe is further delivering on the promise of driving one-to-one consumer engagement at scale for clients. The addition of Rauxa’s strategy, data, tech, media, creative and production expertise further enhances our data-driven creativity offerings and scaled capabilities across investment, strategy, insights and analytics, data and technology, commerce, performance marketing and content,” Publicis Groupe CEO Arthur Sadoun said in a statement.
Financial terms of the deal were not disclosed. Rauxa’s net revenue was around $70 million at the time of the acquisition.
With the acquisition, Rauxa will become part of Publicis Media in the U.S. and continue to be led by founder Jill Gwaltney and president, CEO Gina Smith, who will report to Publicis Media Exchange (PMX) global CEO David Penski and Tim Jones, CEO of the Americas for Publicis Media.
Founded in 1999 as a team of four, Rauxa has since grown to a team of over 320 in the U.S., with offices in New York, Los Angeles, San Francisco, Seattle, Orange County and Dallas, becoming the industry’s largest independent woman-owned agency along the way. Its client roster includes Verizon, Samsung, Alaska Airlines, Vans, Celgene and over 20 other brands. Publicis Groupe also counts Verizon and Samsung among its client roster.
“People ask me, ‘What does it mean to be women-led? How does that differentiate?’ I’d say it gets to [our] core values: mentorship, transparency and care,” Gwaltney told Adweek. “The care we give to our clients and the care we give to our people, that is going to stay and that’s one of the things that [Sadoun] liked about Rauxa and one of the reasons he said, ‘Rauxa’s going to stay Rauxa.’”
Gwaltney explained that implementing Smith, who she said first joined the agency as a receptionist out of college, as CEO in 2016 was a key milestone for the agency and has led to explosive growth. She explained that previously, a holding company acquisition was not something she had considered, but that she was looking for opportunities for Rauxa to grow further.
“One of the nice things is that we got to date Publicis before we married them because we were working on some clients together. It’s really important to me that cultures match. It’s about taking care of employees, doing the right thing and providing this incredible service to clients,” Gwaltney said, a point Penski seconded.
She explained that her father was a mentor while she spent 20 years working with him in the printing business and that his first lesson to her was “figure out what customers need and help them get it done,” which was instrumental in shaping Rauxa’s philosophy.
Penski explained that Rauxa would boost the network’s CRM and personalized creative offerings, areas where he said Rauxa performed “as well as anyone.” He also cited Rauxa’s dedication to client service and client engagement, new business acumen and managerial style, and said that the company added different, but complementary, offerings to existing Publicis Media entities while also boosting it geographically in locations where its presence hasn’t been as strong.
While Rauxa has been on Publics Groupe’s radar for around five years, Penski said the agency particularly stood out as a potential acquisition over the course of the past year or so. The two parties started discussions at the end of last year.
It helped that Rauxa beat Publicis on a couple of new business wins this year alone.
“How they look at a client is so similar to Publicis that it’s a very easy fit for us to bring in,” Penski told Adweek. “We believe across a number of our large ‘Power of One’ clients that Rauxa is the right partner to bring in [to drive organic growth].”
“We’re in a place where we have the team to really deliver on that promise of creating personalized experiences for our brands,” Gwaltney said. “Now we’re ready to show it off to the world, and Publicis makes those introductions for us, … and they also have the power of all these additional capabilities in media, for instance, that help us team up with some of the clients that we have, for a greater offering.”