Indie agency Mod Op launches AI practice as it expands via acquisitions

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As it aims to expand data and artificial intelligence strategies and services for its clients, independent digital agency Mod Op, Digiday has learned, will launch an internal AI practice this week called AI Council.

It’s part of Mod Op’s aggressive acquisition strategy over the past year, with an aim to boost its creative and tech capabilities — as well as to rebundle creative and media assets under one roof. More purchases are planned or in progress, said Eric Bertrand, CEO of Mod Op.

In the past 12 months, Mod Op has closed five acquisitions — with another creative agency purchase in progress and another full-service agency in discussions. Mod Op did not share terms of these deals or its budget. The goal with AI Council is to establish a practice in AI and machine learning across all its strategic business units, from media to digital, as the company grows and positions itself as an AI advisor for clients.

“Our goal is to acquire about one company a quarter or so, maybe one and a half depending on how fast we go,” Bertrand told Digiday. “But we are definitely in acquisition mode, and the goal there is to really take this entire technology development program and roll it across the client base that we’re acquiring.”

The AI Council, led by the agency’s CTO Tessa Burg, will focus on testing AI products and services internally and externally with clients, conduct research and monitor security, compliance and governance practices. The group initially started on a voluntary basis, but has grown to some 30 people from different business units, including experts across digital, media, creative, PR and strategic consulting. Bertrand said it will “scale as necessary” as it hires full-time employees for the Council.

Burg explained that The AI Council will also use a proprietary learning management system for clients, the group can use the platform for training and literacy around AI and machine learning. Additional tools and services will go through a governance framework and measurement process as the agency tests its products.

“If one of those trends looks like it’s going to serve our business or our clients’ business, then it goes through that measurement process to [show] that if we make this investment, here’s the return,” Burg said.

Mod Op said its growing client list ranges from Fortune 500 companies to mid-market brands. Some include Nike, Google, Nvidia and Belvedere Vodka.

Last October, the agency acquired dPrism, a tech management consultancy focused on data and machine learning. In February, it acquired Philadelphia-based creative agency RTOP, Red Tettemer O’Connell & Partners, adding to its social media, experiential marketing and content production services. Bertrand said the aim is to build these acquisitions around the agency’s full-service offerings and leverage technology to be more efficient as it adds new clients and offerings.

“The ability for us to put processes in place … has allowed us to acquire companies and integrate them in at a much more rapid pace than we would have been able to prior,” Bertrand said. “We believe that clients are looking for more full-service relationships, and that’s what we’ve seen in the last year or two.”

It’s an ongoing trend in the space as media and creative agencies seek to combine and grow more competitively through both rebundling and technology investments. Creative shops are of particular focus as more brands experiment with generative AI content and tools.

Still, many of those brands are proceeding cautiously with potential copyright laws and privacy issues in mind.

“AI currently excels in back-end tasks like data analysis and targeted marketing, but its use in visual content generation remains legally murky,” said Nick Watts, chief AI officer of creative production agency Hook. “We’ve collaborated with several of our brand partners on the use of AI tools in our creative production workflows [and] continue exploration – but not yet introduced them into campaign production.”

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