London-based WPP, which owns agencies including Ogilvy as well as media-buying giant GroupM, said the combined agency will be called VML and employ more than 30,000 people in 64 markets. 

VMLY&R and Wunderman Thompson were the product of mergers five years ago when WPP sought to integrate some of its iconic creative agencies with more digitally focused shops. In 2018, WPP matched creative shop Young & Rubicam with digital ad firm VML to form VMLY&R. Also that year, WPP combined J. Walter Thompson, one of the oldest ad agencies in the world, with digital agency Wunderman to create Wunderman Thompson. 

VML will be led by Jon Cook as global chief executive and Mel Edwards as global president. Cook previously led VMLY&R and Edwards led Wunderman Thompson. Debbi Vandeven, who had been global chief creative officer at VMLY&R, will take on the same role at VML.  

The merger is another important step in the simplification of WPP and its offerings to clients, Chief Executive Mark Read said. 

Advertising agencies’ remit has ballooned far beyond work such as making television commercials and now includes offerings such as data consulting, e-commerce and other technology-related services.

WPP, for instance, has said an increasing amount of its creative agencies’ efforts fall outside traditional agency work to include technology, e-commerce and data consulting. The company hopes to make it easier for marketers to access such different services by putting them under the same roof.

WPP needed to evolve more as the marketing landscape has continued to shift, especially as the industry braces for what artificial intelligence will bring, Read said.

“Success with AI is going to require us integrating creative and media and production, and it’s going to be much easier for us to do that inside WPP with fewer, stronger companies,” he said. 

Asked whether the merger would result in job cuts, Read said the move is designed to help VML invest more in areas such as creativity, strategy and technology. “Some of that will come likely at the expense of non-client facing capability, but it’s really about investing the resources we have on what matters to clients,” he said. 

Cook said VML hopes to focus on brand experience, customer experience and commerce for clients. “I think the feeling from a lot of our clients is if you can make [the agency offering] simpler, you can also make it more powerful and create more relevance,” he said. 

The choice of name was meant to showcase that simplicity, Edwards said. “We could have gone with an amalgamation of VMLY&R and Wunderman Thompson, but oh my goodness, can you imagine the name?” she said.

WPP, which plans to report quarterly earnings next week, in August reduced its growth forecast for the year after it saw lower revenue in the U.S. from technology clients and delays in spending on technology projects.

Write to Megan Graham at megan.graham@wsj.com

WPP Merging VMLY&R With Wunderman Thompson - WSJ