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WPP continues consolidation trend with huge new Amsterdam headquarters

The move to bring holding company agencies under one roof continues and WPP has just announced that its to combine all its Amsterdam operations in a new location, the Rivierstaete building in the centre of the city.

The new office will bring together 30 companies and about 1,500 people in 19,000 square metres of space. WPP’s agencies in Amsterdam currently operate from ten different locations.

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WPP CEO Sir Martin Sorrell says: “Our strategic priority is ‘horizontality’ – encouraging the seamless collaboration between our agencies and disciplines that our clients increasingly demand and value.

“The new building in Amsterdam will allow our companies to work more closely and more effectively together, and our people will have the benefit of an outstanding working environment tailored to the needs of modern advertising and marketing services businesses.

“This is a clear statement to the market of our commitment to the Netherlands and the strength of our businesses there.”

Sorrell has been banging on about horizontality for ages, sometimes criticising his agencies for failing to see the light. Putting them all in the same place is one way of solving the problem.

The Amsterdam office is the latest in a series of such moves from WPP. Others include Madrid (more than 40 companies and 2,500 people) and Shanghai (26 companies and 3,000 people). Big rival Omnicom has also taken the same path in London, moving most of its businesses (with the rather large exception of adam&eveDDB) into a vast new HQ in London’s Southwark. Publicis Groupe has the same kind of operation in Shanghai.

The logical consequence of all this, of course, is that holding company agency brands will be diminished and eventually, in some cases, disappear. The big holding companies are all struggling to cut costs as global growth slows down and margins come under pressure and the quickest way to do this is to axe overlapping departments and people.

So there’ll eventually be one back office and, perhaps, one combined creative/production department. The world’s big clients seem to want to hire holding companies anyway these days so why do they need all those agencies?

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.

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