IPG Continues Zentropy Changes

Zentropy Partners is again shifting positions under the watchful eye of the Interpublic Group, as agency holding companies experiment with how best to position their Internet plays.

Under a new organizational structure, McCann-Erickson’s MRM Worldwide will be combined with Zentropy Partners, a once-high-flying design and interactive shop. The resulting entity, MRM Partners Worldwide, will focus on CRM and digital marketing.

Zentropy and McCann have had a close partnership since October, when IPG essentially brought Zentropy back in-house under McCann-Erickson. (The unit first had been created by IPG as an independent entity in 1999.)

Now they’ll be even closer: as part of the reorganization, Zentropy will be moved from Cambridge, Mass., to MRM’s New York office.

Overseeing the new MRM Partners Worldwide as president and chief executive will be Pamela Maphis Larrick, who previously served as president and chief operating officer at MRM Worldwide. Larrick will report to chairman Stan Rapp, who previously served as chairman and CEO of MRM Worldwide.

Michael Tey, who has been president of Zentropy since October, keeps the title with a subtle difference — he’s now head of the Zentropy digital and interactive solutions arm of MRM Partners. In October, Tey succeeded Zentropy’s founder and former CEO John Connors, who switched to IPG’s Internet Ventures Group.

Tey also will lead MRM’s new Enterprise Relationship Strategic Consultancy, which McCann’s chairman and CEO Jim Heekin described as a way for clients “to better align their internal resources and communications as customer-focused corporations … in order to become more effective at relationship management with their end-customers.”

Even though Zentropy — which started out as a full-services interactive design and advertising shop — is now relegated to handle CRM-focused digital duties, executives at McCann described the changes as a pooling of mutually beneficial capabilities.

Indeed, Heekin put all of the changes happening within MRM into a larger context — one of providing one-stop solutions for clients’ external and internal relationship management needs.

“It moves the current practice of CRM up a notch, insofar as it involves helping corporations better connect in an integrated way with all of their customers, including ‘internal’ ones such as suppliers, distributors and employees,” he said.

Zentropy plays into the deal because this whole process has been “made more doable because of the growth of Web-based communications systems,” Heekin said. “MRM and Zentropy are such natural partners at this point in time and for this type of expanded business opportunity.”

Interactive agencies coming into closer association with traditional agencies — or being absorbed by them entirely — is an increasingly common occurrence, as the big agency holding companies report growing losses from their Internet operations.

However, the big ad groups don’t seem to have produced a unified solution to handling the problem of their interactive agencies, which are suffering in the current market environment. And as a result, the holding companies are responding to the interactive slowdown in dissimilar ways, placing similar digital shops in widely differing positions.

Earlier this year, Beyond Interactive became a unit of Grey’s MediaCom division — a media buying group. Meanwhile, Omnicom has spun off its Communicade interactive portfolio — which includes Organic, Red Sky Interactive, Razorfish and Agency.com — into a separate company, Seneca Investments, in a joint agreement with the managers of Greenwich, Conn.-based LBO fund Pegasus Partners II.

However, before the spin-off, Omnicom placed Organic in a vaguely defined strategic alliance with BBDO, which already has its own agency, @tmosphere.

True North, meanwhile, seems content to let Modem Media remain semi-independent, although the Norwalk, Conn.-based i-shop has been slimming down as of late. And with a True North-IPG merger on the horizon, changes could be afoot at Modem Media soon.

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