Mega-coalition

This week has seen the news of a mega-coalition. No, we’re not talking about Labour and UKIP joining the Lib Dems and Tory’s in a truly frightening hydra, rather that Publicis Groupe and Omnicom Group, two of the world’s largest communication companies, have announced plans to merge and form the world largest marketing and advertising services company. This holding company will include PR brands such as MSLGroup, Publicis Consultants, Kekst and Company, FleishmanHillard, Ketchum, Porter Novelli, Marina Maher Communications and Cone Communications – a lot of big names in their own right!  With all that creative talent (135,000 people to be precise) you would have thought they might have come up with something a little more inventive for a name other than: Publicis Omnicom Group. But who am I to argue with a $35 billion company!

So what will a merger like this mean for the companies involved? On the ground probably very little, in a merger like this those subsidiary companies may benefit from the services of the wider group. Clearly there will be some ‘efficiencies of scale’ around access to resources, media buying, data and sadly staff. Nor is the merger likely to be about giving greater flexibility to those companies in the marketplace. Agencies aren’t going to want to force feed valued clients a solution simply because they are part of the wider group and now have access to it (and remember most of these companies are very successful in their own right, and a larger group whilst relishing the streamlining and efficiency savings to be made, won’t want to tamper too much with any winning formulas).

And what about the client? Communications choices for clients aren’t ever really dictated by the size of the company, it’s more the offering they provide. In my experience of pitching and creating proposals for a range of companies small and large, occasionally you lose out as a client wants to work with a much smaller company (who they perceive, rightly or wrongly, as being more responsive) but rarely (in fact never) have I ever heard a prospect say ‘you know what, I’d rather go for mega company X, as they so much bigger, and I think I’ll feel so much more snug as part of a larger group.’

This isn’t to say ‘big’ can’t be creative and innovative, because just looking at some of the great work of the agencies above proves that’s not the case. 

So the merger isn’t really for the benefit of the companies involved or really for the clients (who will no doubt see very little difference), no, the benefactors will likely be seen on the balance sheet of the accountants and the bank balances of the executives. That’s the reality of what drives most mega mergers, it’s not wrong or right, it’s just life. Here at Word Association, where we pride ourselves on our nimble approach to client’s needs, we watch and wait with interest to see if there any impacts felt at the coal face. Who knows, maybe this is the start of something very different in marketing and advertising services the start of a new google or facebook, or maybe not, maybe it just means a few less Ferraris in a Mayfair dealership come next week.

Posted on by Mark Thomas

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