Mediaboss Marketing

By Calum Muirhead For The Daily Mail 22:32 22 Mar 2023, updated 10:34 23 Mar 2023

Advertising giant WPP has snapped up a marketing firm whose co-founder had criticised its strategy as not fit for purpose.

The FTSE 100 firm bought Goat, a social media-focused agency based in Londons Millbank Tower, for an undisclosed sum to merge with its influencer marketing arm INCA.

The deal could be worth as much as 400million, handing founders Arron Shepherd, Nick Cooke and Harry Hugo a handsome payday.

Influencer marketing is when companies and brands partner with popular online personalities to promote products to their audiences on sites such as Facebook, YouTube and Instagram.

WPP said the acquisition will create the sectors first truly global influencer marketing agency with chief executive Mark Read saying the area was a key growth priority for the industry and for WPP.

Goat co-founder and boss Shepherd said they couldnt be happier to be joining the ad giant.

The comments are a major shift from Shepherds previous attitude to WPP. He previously said the firm hadnt quite worked out digital yet.

In an interview with The Influencer Marketing Lab podcast last March, Shepherd used the agency as an example of a group that was not doing that well.

The size of WPP, there might be 30 per cent to 40 per cent of their business that is literally not fit for purpose in the next three or four years, he added.

Shepherd also said at the time that Goat was considering a listing on the stock market and it hoped to become a similar entity to S4 Capital.

S4 is a marketing agency that was set up in 2016 by WPPs ex-boss Martin Sorrell after he resigned from the company amid misconduct allegations which he denies.

WPP shares rose 0.5 per cent, or 4.4p, to 953.6p after news of the deal.

While the takeovers worth was not disclosed, a source close to the matter indicated Goats value was not a million miles from past reported price tags.

These included reports from April last year that the firm was mulling a sale for a potential value of up to 400million.

Goat has worked with several major firms to sell products through online personalities.

It counts computer maker Dell, taxi app Uber and supermarket Tesco among its clients.

The company was founded in 2015 by Shepherd and his two partners Cooke and Hugo who, according to Goats website, met while working for a social media group in 2012.

It now has more than 150 staff across offices in London, New York and Singapore.

According to latest accounts filed with Companies House, the firm had a profit of 6.5million in 2021, more than triple the 1.8million reported the previous year.

The acquisition comes as WPP tries to shift away from traditional advertising models and towards new methods of reaching consumers amid the growing importance of social media and internet marketing.

WPP is also targeting the use of technology such as artificial intelligence (AI) in the industry, with Read saying last month AI was fundamental to the future of the business.

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