Omnicom-IPG merger: A Christmas sugar hit followed by a strict diet?
Two of the big five agency holding companies, Omnicom and Interpublic, are set to merge. TrinityP3’s Stephen Wright breaks down the potential winners and losers from the deal and its implications for the Australian market.
‘Tis the season.
This week, the market paused to absorb the news of an epic US$13bn global merger between two of the big five holding companies – Omnicom and Interpublic.
This is massive news with repercussions across major advertising markets, including Australia. If I may extend the Christmas metaphor further, I worry this is a holiday sugar hit — designed to boost the share price and secure executive bonuses — but, as with all Christmas indulgences, January will bring a strict diet, and trimming down will begin in earnest.
“Designed to boost the share price and secure executive bonuses.”? During the pandemic both of these holdcos made sizeable staff cuts. Fair enough. But shortly afterwards, the US CEO of one of their media agencies was directed by its c-suite to make yet further staff cuts in order to ensure year end bonuses were definitely met. They protested that such drastic culling would render their agency not fit for purpose. The c-suite responded, “just hire some of them back later.” Merry Christmas everybody, and remember our people are our most important asset.
The critique of this merger as a “sugar hit” completely misses the bigger picture and is symptomatic of the knee-jerk skepticism doing the rounds right now. This move is designed to future-proof two industry leaders. Change is a necessary evolution to survive and thrive in a market that demands agility, scale, and innovation. Let’s stop romanticising the nimbleness of independents and start recognising the benefits that come with global integration.
This merger isn’t a December indulgence; it’s a blueprint for the next decade of agency dominance. But don’t let that get in the way of a good bit of clickbait…
Clients haven’t been generous on rates for years, so why shouldn’t agencies prioritise scale and innovation to stay competitive?
Global consolidation isn’t a novelty—it’s a necessity in today’s economy. Scale drives agility, better rates, and smarter investment. And this merger hasn’t come out of nowhere—the smart players have time to reskill and prove their value.
What’s your alternative? Romanticising the past won’t solve the challenges of the future. Let’s focus on solutions, not nostalgia.
Wow…’the next decade of agency dominance’.
Sounds like a power trip to me.
Redundancies and the human cost irrelevant in the pursuit of global dominance.
Future proofing through scale isn’t what the market needs.
Very very few clients would be popping champagne corks in celebration.
Yes, yes but what is the new name going to be?
I’m betting on Omnintercom ?