Gusto Collective has acquired a majority stake in luxury focused agency Reuter Communications, for an undisclosed value.
Reuter will be renamed Gusto Luxe. Partners Chloé Reuter and Nick Cakebread will stay with the business, taking on key roles in growing Gusto Collective at the group level, according to the company. Chloé Reuter will be re-designated as founding partner and vice chair of Gusto Luxe and Gusto Collective, while Cakebread will be founding partner of Gusto Luxe and Gusto Collective.
With 120 employees, Reuter Communications has a presence in Shanghai, Hong Kong, Singapore and London and works with luxury brands such as Everlane, Vivienne Westwood, Harrods, Hilton and Sotheby's. "After 10 years building Reuter Communications, it's a fantastic evolution for our agency," Chloé Reuter said in a statement. "We believe that the future of our industry lies in its constant evolution, and we are convinced that technology's importance will keep growing."
The deal is the first acquisition for Gusto, a holding company founded by Aaron Lau, the former international president at Cheil Worldwide. Reuter joins the holding company's other entity, Gusto Media Lab, which launched in February of this year and is led by Ray Wong, former Hong Kong CEO at PHD.
Gusto Media Lab is a digital tech studio devising media, immersive experiences and innovative marketing solutions, according to the company. An example is the recently launched 5G AR Lens, a location-based AR app for mobile carrier CSL. Gusto Media Lab also includes Lumen Research, billed as an attention technology software maker, which uses eye tracking to measure and predict visual engagement. Its tech passively monitors what viewers actually look at when online or in a store. Currently, Gusto Media Lab employs 10 technology specialists.
Gusto, Lau told PRWeek Asia, brings together marketing and digital agencies with technology firms to help brands run and manage their marketing more efficiently. Formed in early 2020, the collective combines storytelling with digital and mobile technology and currently serves over 80 clients across four locations in Hong Kong, Shanghai, Singapore and London.
Funded by an initial multi-million-dollar investment from Gusto's founder and CEO, Lau, and a group of other investors, Gusto intends to expand its core solutions in data and consultancy, content creation and distribution, and immersive AR/VR digital technology, through a mix of acquisitions, joint ventures and startups in the region.
The deal for Reuter is expected to be the the first in a series of acquisitions, joint ventures and greenfield ventures for the collective, Lau said. "We don't want to replicate the strategy of the legacy big six networks of having competing agencies in the same swim lane." he added. "We will acquire one agency in each field and grow their competency, except in large markets such as India and China, which may require more than one entity."
While the pandemic has slowed the deal making fervour—the Reuter deal was meant to close as early as March this year—the collective remains focused on expanding across Asia. While China (including Hong Kong) will be its first stop, Lau also wants to set up shop in Vietnam, India, Singapore and Australia. Rather than acquire or do business with traditional agencies, this new shop wants to piece together an approach that is more "digitally focussed and data-centric."
"Asia is changing and clients need agencies to respond quickly to changing needs and demographics," Lau said. "Many clients are unhappy with the business model being offered to them by legacy networks ... without the financial chains imposed on these publicly listed giants, Gusto can offer some fresh solutions to them."
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