Omnicom Acquires Web Marketing Service

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TORONTO - Omnicom Group Inc. expanded its interactive capabilities last month by acquiring a 50-percent equity stake in Critical Mass, an online marketing services company located in Calgary, Alberta.


Critical Mass, which has offices in Chicago and Stockholm, will be integrated with Omnicom's newly-formed electronic customer-relationship management company, Rapp Digital.


Part of Omnicom's Rapp Collins Worldwide division, Rapp Digital will be headed by J.G. Sandom, previously director of interactive-North America at OgilvyOne Worldwide in New York.


John Wren, president/CEO of New York-based Omnicom, said "the acceptance of the Web as a global communications and transactional medium has taken direct marketing to a new level. The future of customer relationship management will be driven by the Internet protocol.


"We believe that Critical Mass' world-class Web site design and development resources combined with Rapp Collin's expertise in database, analytics, brand and creative strategy will fundamentally redefine Web-based one-to-one marketing."


Over the past two years, Critical Mass and Rapp Collins have worked on a number of Web development and Internet marketing programs for such clients as Mercedes-Benz USA and Procter & Gamble.


Only days before linking up with Omnicom, Critical Mass won a prized assignment to build P&G's first direct-to-consumer Internet site, Reflect.com.


Formed last month in conjunction with venture capital firm Institutional Venture Partners, of Menlo Park, CA, Reflect.com will sell cosmetics products, and it will feature advanced technology that enables users to change the site according to their tastes and interests.


"We are in a growth mode and our new relationship with Omnicom provides us with opportunities that are truly global in scope," Jerry Johnson, president of Critical Mass, said. "We excel at leveraging the Internet to delight customers, increase brand loyalty and deliver personalization."


Critical Mass' ability to offer site personalization was the key to its Reflect.com win, said a P&G spokesperson. P&G has awarded four additional assignments, related to other company divisions, to Critical Mass, but no details have been released.


Co-founded in Calgary in 1995, Critical Mass has 150 employees and annual revenues of more than $13 million. It has developed online relationship marketing programs and Web sites for such clients as Denny's Restaurants, United Distillers & Vintners' Smirnoff Vodka, NovAtel, Telus Marketing Services and Forenings-Sparbanken, one of Sweden's largest financial institutions.


The Critical Mass deal is just one of many Omnicom has reached in the past two years as it has sought to grow by adding services in the areas of interactive, direct marketing and sales promotion.


Earlier in October, for instance, it spent $100 million to acquire integrated marketing services specialist M/A/R/C, of Irving Texas.


Omnicom's Diversified Agency Services comprises 75 marketing services firms and accounts for about half of the company's $5 billion in revenues.
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