Scout Marketing | 2017

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Scout Marketing

Performance

Revenue increased about 30% to an estimated $29.5 million

Plans

“There's a feeling that if we continue to abide by [our tagline] Be Brave and focus on our clients, success will come”
— Raffi Siyahian

Prediction

“With all the noise about healthcare costs, everybody's wondering how that's going to impact marketing. What people are realizing, though, is that lots of therapies are needed and it's difficult for anybody to clamp down on price, especially in the rare disease space”
— Raffi Siyahian

In mid-April, before responding to a question about whether Scout Marketing had changed in any significant structural way since its last state-of-the-agency conversation with MM&M, agency principal and president of healthcare Raffi Siyahian paused. “I'm not sure how to put this,” he said. “The answer today is no. We might have something else to share soon.”

“Soon” came about 10 days later, when the change to which he was referring came to pass: Scout announced it had been acquired by Stagwell Media, a private equity fund headed by former Burson-Marsteller CEO and Clinton administration pollster Mark Penn.

Raffi Siyahian

principal and president of healthcare: Raffi Siyahian

It joined Harris Insights & Analytics, digital firm Code and Theory, strategy shop SKDKnickerbocker, and several others already under The Stagwell Group roof.

The deal, which took shape over the last few months of 2016 and early 2017, was “intriguing from the get-go,”Siyahian says, as much for what it was — an infusion of resources and expertise — as what it wasn't, a larger organization swallowing a smaller one, and its identity, whole. He notes that over the years, Scout had spurned the suitors that came its way, fearing the agency's culture wouldn't survive the transaction.

“I'm not disparaging the typical holding-company model in any way, but we felt we wouldn't be able to retain what makes us ‘us,' which is our culture,” Siyahian explains. “Also, holding companies typically have many agencies and separate P&Ls, which means they basically compete against each other in some way, shape, or form. That's not the case here. If you look at what Penn is doing, it's putting together complementary service offerings, not competing ones.”

The expected worries about any change big or small notwithstanding, Siyahian says the team is delighted to formally join forces with the like-minded thinkers and marketers at Stagwell.

“For us, what it does is make the path forward a little more clear. Stagwell wants us to keep doing business as usual, then look to how some of these other service offerings it has can be leveraged to clients,” he notes.

Given Scout's recent growth, Stagwell would likely be pretty happy with the status quo. Scout grew its revenue nearly 30% in 2016, to an MM&M-estimated $29.5 million. It increased staff size to 147 in late April, bulking up its digital and devices and diagnostics moxie in the process.

That second part wasn't intentional. Among the agency's big wins in 2016 were ElectroCore, for a device slated for U.S. approval later this year, and Hologic, as AOR for its diagnostics line. Scout, of course, is known less for its devices and diagnostics know-how than for its rare-disease expertise — but Siyahian believes the two spaces have quite a bit in common.

“We didn't intentionally point our arrows in that direction — toward devices and diagnostics — but there are some similarities. Both require a degree of specificity and a very strategic approach, because the goal in both cases is to get HCPs and patients to change their mindsets and behavior,” Siyahian explains.

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