The big want to be bigger, just ask WPP
I was struck by a story in the Aug. 27th Wall Street Journal headlined “WPP Closes In on Hostile Takeover of TNS.”
To give you some background (more of which will be in your Sept. 15 issue of Marketing News, so watch for it there) GfK AG had been trying to buy Taylor Nelson Sofres plc (TNS) when WPP in July launched an uninvited counteroffer of $2.02 billion. TNS is still saying publicly that it plans to fight the WPP onslaught.
The Journal story mentions that research is becoming more important for marketers and that big communications holding companies such as WPP are looking for more sources of income.
I was wondering just how much income it expects to add with TNS when I’ve often heard it can be a tricky proposition even in good economic times, let alone now, to get clients to allocate some of their project funds for research and measurement. A colleague, however, told me this is really more of a defensive move by WPP to keep TNS from falling into a competitor’s hands.
WPP already owns Kantar Group, which ranked No. 5 in Marketing News’ Honomichl Global 25 Report of the top market research firms. London-based TNS ranked third and GfK fourth.
What do you think of this move? A proactive way to grow WPP, a defensive move to keep a competitor from getting bigger, or maybe a bit of both? If WPP succeeds, who will be the next target and why? Will GfK be forced to look for another deal?
