Sizing Up: Gramercy Group becomes part of Publicis network.
New York City-based Gramercy Group became the latest independent promo shop to opt for subsidiary status this month, reaching a deal to be acquired by Paris-based advertising agency Publicis.
“We weren’t on the market,” notes Gramercy founder and ceo Mark Severini. But the 12-year-old agency’s principals increasingly saw that “you need that critical mass behind you to be successful. Clients want more of a global network, and we’ll avail ourselves of that through Publicis,” he says.
Severini says he’s had other offers recently, but that Publicis got the nod because “they saw us as their first entry into direct marketing and sales promotion. We wouldn’t have been as important” at some of the other advertising houses that came calling.
Gramercy will become the New York City base for Publicis Dialog, an integrated communications division for which Publicis also recently acquired p.r. shops LobsenzStevens, New York City, and Purdom Public Relations, San Francisco. Severini becomes president and ceo of direct marketing and promotions for Publicis Dialog.
“We are looking for further strategic acquisitions,” especially in cities where the agency already has a presence, says Publicis Dialog president Andy Hopson.
In New York, “Gramercy is a very, very strong foundation to build from. They’ve done some very good work for Michelin in the past year [and] some fantastic work for Subway [Restaurants],” Hopson says.
Gramercy Group reported $7.5 million in gross billings and $1.4 million in net revenue in 1998 to rank 96th in the promo 100. Net revenue slipped 32 percent between 1996 and 1998 as gross billings rose 26 percent. The company has 38 employees and a client list that includes Eli Lilly, Pfizer, Hearst Magazines, and barnesandnoble.com.
Publicis has clients in 76 countries and total billings of $6.5 billion, $1.5 billion of which is generated in the U.S. Last spring, the company acquired a 49-percent interest in African-American marketing specialists Burrell Communications (July promo).
