Y&R Acquires Consulting Company

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Young & Rubicam, New York, announced the strategic acquisition of a consulting company last week that will result in new leadership at its direct marketing subsidiary, Wunderman Cato Johnson Worldwide (WCJ).

The consulting company, Capital Consulting & Research, will merge with WCJ, and its president and founder, John "Jay" Bingle, 51, will take the role of chairman and CEO of WCJ and continue to operate Capital Consulting & Research, New Canaan, CT. The cost of the acquisition reportedly was between $6 million and $7 million.

Bingle will report to Y&R chief operating officer Ed Vick and replace current WCJ CEO Barbara Jack. Jack will become interim executive director at Y&R until the beginning of next year, when she will take on a new management role at the company. Bingle's appointment also comes four months after agency founder Lester Wunderman formally stepped down as chairman.

The acquisition comes in the midst of continued talk in the industry of the businesses of consulting companies and advertising agencies coming closer together.

Capital Consulting & Research is among the companies whose services could be considered a cross between consulting and marketing. The company was founded in 1986 to focus on marketing consulting, Bingle said, though it has expanded into other forms of consulting since.

"We have a practice consulting to professional service firms that consult or work on call-center activity, collecting and analyzing data, making decisions on channels of distribution and using data to pattern customers," Bingle said.

In recent years, he has seen a change in consulting companies' interest in marketing and advertising.

"It has become more pronounced," he said. "We see more consulting companies moving in that direction."

Although Y&R has a consulting company, Landor Associates, it focuses on brand consulting, particularly related to design, rather than the broader marketing management services that Capital Consulting & Research offers.

Capital Consulting & Research's relationship with Y&R began early in 1997, when it began doing consulting work for Y&R, Bingle said. Having worked as an outside consultant with Y&R executives, including chief operating officer Ed Vick and chairman and CEO Peter Georgescu, Bingle felt comfortable moving into a role inside the company.

Approximately one-third of Capital Consulting & Research will merge operations with WCJ. Its other parts -- an executive search practice and a technology group -- will continue to operate independently under a different brand name. The section of the company that will merge with WCJ includes 22 people, Bingle said.

Although entering a company the size of WCJ -- with more than 2,300 employees in 65 offices in 39 countries -- may seem daunting, Bingle has experience at large international companies, including Time Inc., International Paper and Alexander & Alexander.

"I took a 12-year hiatus from the large corporate world," he said.

Bingle declined to discuss what types of changes could be expected as the two companies merge.

"It will be an interesting challenge, with the new additional services of electronic commerce, database services, data mining, strategy and analysis added to the more traditional direct marketing," he said.

Meanwhile, although not involved in the deal, Lester Wunderman noted that it fits with his original vision for the agency.

"Wunderman Ricotta & Klein [the predecessor to WCJ] was founded as a company that offered consulting services to its clients, so I think it's a good move to bring it back to the principles on which it was founded," he said.

Wunderman primarily had focused on strategic consulting in his role at the agency, he said, and, in its early years, the agency maintained an internal consulting group.

Y&R officials declined to comment as the company is in registration for its pending initial public offering.

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