You can go to Ad Age, Jim Edwards’ coverage on Business Insider or DigiDay to get all sorts of news and reactions to today’s announcement regarding the merger of Publicis and Omnicom. Besides really throwing everyone’s summer weekend into chaos, opinions are flying regarding the merits of the deal.
Here’s my biggest question:
Is there any current client of these holding companies that thinks their marketing and advertising will be improved by this merger?
We’ve already heard that in a sense, Pepsi (through TBWA/Chiat Day) and Coke (through Leo Burnett, among others) now have the same ad agency. And I’m sure there are dozens of other conflicts at play.
But what do clients gain here? A more international footprint? Economies of scale in media buying? Access to better talent? Lower overall costs? Better client service? Better creative?
Some people on Wall Street will cheer this merger. And surely the lawyers, accountants and management who will make money off this will cheer the merger.
But please, point me towards a current client that will cheer on this deal.
Because this moment, and the next year or so in which this deal gets finalized, could the tipping point at which marketers will freely admit, “bigger is better.” Or they could say, “enough is enough” and finally turn against the dominance of holding companies. Which will it be?
I think your question is kinda moot. Do any current clients think their service will improve? Probably not. But most of them likely believe their services will not degrade at all. The profitable clients at big, dumb agencies are big, dumb companies too. They are not going to defect because Publicis Omnicom Groupe is gigantic—and if they do leave, it will be in favor of an equally big, dumb agency. POG will likely offer some type of savings benefit to their clients. Then again, maybe not. Look at the way Omnicom has shuttled Quaker and PepsiCo from one sister agency to another. Now they’ll have even more choices when they hate their current shop but want to honor the contract with the holding company.
Of course it’s a moot question, but I’ll still ask it. Which is why the Ad Age article today that referenced client’s reactions didn’t really say anything substantive. Big holding companies serve clients who don’t want to see past the numbers to truly understand the level of service, expertise, or creative they’re getting.
Well, also keep in mind that many of the big clients became big in the same way that Publicis Omnicom Groupe did—i.e., through takeovers, mergers and acquisitions. Think about telecommunications companies, for example. When your provider acquired or was acquired by another company, did you expect to get better service? Did your service suddenly undergo a dramatic shift? Of course not. In the end, it’s the same shit with a new logo. You started writing a different name on your monthly payment checks. Ditto Publicis Omnicom Groupe. The holding companies are to blame for ultimately turning agencies into generic service centers. Doesn’t help when creatives migrate from shop to shop. Honestly, can you tell the difference between, say, Leo Burnett and Grey? BBDO and DDB? And think about the big clients. Procter & Gamble sells how many different detergents and shampoos? Ever work on Coca-Cola? They know their own brands are competing against each other. It’s fucked up all around. That said, big agencies and big clients still offer benefits for creatives, in terms of offering opportunities to work on big-budget assignments. They also come with big committees and big headaches. Every scenario has pros and cons.