KPMG Australia proves you can buy Love with digital agency deal

The Australian wing of professional services giant KPMG has purchased a digital agency to strengthen its Digital Delta business. Love Agency, which generated AU$10 million in fees in the past year, will see its 40 staff join KPMG as it bids to expand its holistic consulting and design offering.

When the news broke that consulting firm Accenture was set to purchase advertising agency Karmarama in late 2016, the proposed deal was hailed as signalling the consulting industry was about to buy its way into the marketing services sector. Those inclinations were not wrong, and the deal sparked a sustained month feeding frenzy in which top-consulting firms splurged more than $1 billion on small and mid-tier agencies by the end of 2017 alone.

The Australian market has been no stranger to this global trend either. In the last quarter of 2018, the digital lovechild of Accenture and Microsoft, Avanade, purchased Melbourne-based agency Loud&Clear. The move came amid an era of consulting firms encroaching further into the creative agency space of the Australasian region, in which many firms have sought to bolster innovation and digital capabilities via aggressive acquisition campaigns.

Now, the latest chapter of this unfolding saga has seen KPMG’s Australian wing purchased 40-person digital outfit Love Agency, as the Big Four giant looks to expand its skills in online user experience, web and mobile development. Love Agency is a web design and development consultancy that has done online work for gambling company Crown, NSW government departments and publisher HarperCollins, and will become part of KPMG's Digital Delta business which already consists of 300 professionals. The terms of the transaction were not disclosed.

Love Agency generated about AU$10 million in fees in the past year, and its founders, Chief Executive Danny Housseas and Chief Operating officer Arthur Gougoustamos, will join KPMG as Partners along with 38 staff. There, they will combine with KPMG’s specialists in digital strategy, artificial intelligence, cognitive and machine learning, internet of things, and data, analytics and modelling, as its Big Four rivals Deloitte, EY and PwC, also push further into the higher-growth consulting area over traditional auditing and assurance work.

Speaking on the deal, Housseas commented, “We had grown to a size where we were going for big jobs and butting heads with the major consultancies… At this level we were constantly being asked for services outside our wheelhouse. To get to the next level and be able to win the most interesting briefs with the biggest organisations, we knew we needed to partner with a large firm."

Ian Hancock, KPMG's Head of Management Consulting, said of Love Agency, "Essentially, they are experts in something we need to do better if we are to provide clients a real, end-to-end digital solution… By bringing Love Agency into the fold, we are addressing this directly – adding their UX experience and expertise in building enterprise technology to our existing digital consulting teams. They’re the missing piece of the puzzle for us.”