JWT to Acquire Digital Branding Agency

J. Walter Thompson Tuesday confirmed reports that it will acquire San Francisco-based Tonic 360, with which it recently landed Sun Microsystems from Lowe Lintas & Partners.

Tonic 360 handles branding and advertising for digital brands, including Sun Microsystems, AvantGo, and Go.com, with annual billings of about $150 million.

Tonic 360 and New York-based JWT jointly won Sun’s $100 million account in September, which went up for review when the computer hardware company’s former agency, Lowe & Partners, merged with Ammerati Puris Lintas — which handled Sun rival Dell Computers.

JWT, which is a unit of the WPP Group, said the acquisition will expand its marketing capabilities for online brands.

“Over the past three years, JWT has reengineered itself in order to stake out a niche as the best partner for large, established brands transitioning into the digital space,” JWT chief executive Chris Jones said. “Tonic 360’s depth of marketing expertise, second to none, will give us another significant edge in this arena.”

The purchase comes as interactive agencies are feeling the revenue shortcomings from tanking dot-coms, and as traditional agencies like JWT are determining how best to guide their traditional clients — which includes Ford, Unilever and Pepsi — into the digital space.

“We have made significant progress in reinventing how we deliver communications that converge content with commerce. The combination of JWT and Tonic 360 will make us a more potent force in digital marketing,” said JWT New York president Bob Jeffrey. “Tonic 360’s deep understanding of the digital consumer expands and invigorates our service offering to current clients.”

JWT also operates an interactive division, Digital@JWT; the relationship between Digital@JWT and Tonic 360 is not yet clear, although the company said Tonic 360 would operate as a standalone unit.

“They bring an entrepreneurial passion for this new world that will make the agency a great training ground to immerse our people in digital brand marketing,” Jeffrey said.

Tonic 360 founders Kevin Burke and Fred Schwartz will continue to head up the unit.

“Together, we can expand our resources, better serve our current clients and anticipate emerging digital marketing needs,” Burke said of the deal.

Terms were not disclosed.

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