Publicis just added a big weapon to its digital arsenal, spending $575 million to acquire Rosetta.
The deal means the third-largest agency holding company now owns three of the 10 top digital shops by 2010 revenue: No. 1 Digitas, No. 4 Razorfish and No. 8 Rosetta, according to Ad Age DataCenter. Hamilton, N.J.,-based Rosetta, with primarily health care, retail and financial services clients, had $218 million in revenue last year, up 23% from the prior year. That makes it bigger than AKQA, one of the few remaining digital acquisition targets, because it’s not already owned by an advertising holding company.
In January, Ad Age named Rosetta its top pick of shops to watch in the coming year.
Rosetta’s health-care expertise was likely attractive to Publicis. It shares a client in Johnson & Johnson, for which Razorfish does corporate brand and other marketing work.
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The sale represents a major change of heart for Rosetta CEO Chris Kuenne, who has been very vocal about plans to keep Rosetta independent and grow not by selling, but by acquiring other companies. Last fall, Rosetta picked up Level Studios, a California-based mobile shop. Before that, acquisitions included health-care shop Wishbone ITP in 2009 and Ohio-based digital shop Brulant in 2008.
Kuenne opened Rosetta’s doors in 1998 after a decade in the marketing department at J&J, leading the Band-Aid and Tylenol brands business. His subsequent work as a partner at First Manhattan Consulting Group, where he led its retail marketing practice, has helped to reel in the agency’s smattering of retail clients, such as Hallmark, Crane & Co., Things Remembered and Sunglass Hut. Kuenne will continue to lead the agency, reporting to Jean-Yves Naouri, chief operating officer of Publicis Groupe.
“Rosetta’s value proposition is unique in that it combines its savoir-faire in consulting and strategic services with its expertise in technology and creative agency services,” Maurice Levy, chairman-CEO of Publicis Groupe, said in a statement announcing the deal. Publicis hopes to increase its share of revenue from digital from its current 28% to 35% in the next three years. The addition of Rosetta brings that total to 30%, according to the holding company.
