Omnicom\u2019s $13.5 billion acquisition of Interpublic Group creates the world\u2019s largest advertising and marketing holding company by revenue and billings. B&T breaks down the state of play in Australia and what a combined group could look like.<\/p>\n
Omnicom\u2019s acquisition of rival Interpublic Group marries two Madison Avenue giants with some of the most storied advertising agencies going.<\/p>\n
Nonetheless, research shows that most M&As\u2014around three-quarters, according to a Fortune study\u2014end up in failure, and almost all create chaos and change for at least one of the parties.<\/p>\n
Omnicom\u2019s acquisition of IPG allows it to scale its data and tech, while delivering greater scale and operational efficiencies.<\/p>\n
Globally, Omnicom 2.0 will be led by John Wren, who remains CEO and chair, while Phil Angelastro\u202fstays on as EVP and CFO, and former IPG CEO Philippe Krakowsky\u202fand\u202fDaryl Simm\u202fwill serve as co-presidents and COOs.<\/p>\n
There have been plenty of rumours circulating about what the merger means for agencies. B&T has previously reported that the DDB brand could be retired, while other rumours indicate that FCB and MullenLowe could join forces, potentially leaving the group with BBDO Worldwide, McCann Worldwide, TBWA+DDB, FCB+MullenLowe, as its creative brands.<\/p>\n
The media side is less clear. B&T understands that OMD and PHD are safe. Initiative and UM could also stand alone, but one of these may absorb Hearts & Science.<\/p>\n
The final make up will likely stem from Madison Avenue, and Oceania has already been flagged as one of the pilot markets.<\/p>\n
Nonetheless, there will be repercussions Down Under, with an announcement expected this week.<\/p>\n
Here is what we know about the agencies and key figures involved.<\/p>\n
Omnicom Oceania<\/p>\n
Omnicom Oceania is led by Nick Garrett, the former Clemenger BBDO leader and global CMO of Deloitte Digital.<\/p>\n
TBWA\u2019s Lisa Brown has been appointed to lead production and Daniel Klug has been appointed director of new media.<\/p>\n
Last week, Garrett said that he was in the \u201cuncomfortable position\u201d to merge 127 brands, products, services and capabilities that sit under the agency brands into 30.
Garrett pointed out that his biggest task will be uniting the different Omnicom and IPG agencies under a single culture.<\/p>\n
\u201cYou can have the most unbelievable architecture. You can hire the best technology systems integration with people, and we all know it\u2019s bullshit. Culture eats strategy for breakfast. If you don\u2019t get the people, it doesn\u2019t count for shit,\u201d he said.<\/p>\n
Omnicom Media Group<\/p>\n
Here\u2019s where it gets interesting. In Australia, Omnicom Media Group is currently led by chief executive Kristiaan Kroon and new COO Mark Jarrett. Tony Harradine is CEO of Omnicom APAC.<\/p>\n
At present, IPG Mediabrands is led by industry veteran Mark Coad, who forged a successful leadership career at Omnicom through OMD and PHD before joining Mediabrands. The roles of Coad, and APAC boss Leigh Terry, are unlikely to continue. We shall soon learn if Omnicom finds alternative roles that are appealing to the pair.<\/p>\n
Creative agencies<\/p>\n
Clemenger BBDO (full service)<\/p>\n
Leader: Lee Legett<\/p>\n
Headcount: 350<\/p>\n
Offices: Sydney, Melbourne, Brisbane<\/p>\n
Major clients: Samsung, Mazda, Asahi<\/p>\n
2024 B&T Agency Scorecard<\/a><\/p>\n Outlook: Clemenger BBDO only recently united Clems, CHEP Network and Traffik into a single agency. Although they recently lost strategy chief Simon Wassef to M+C Saatchi, the agency is likely to be safe.<\/p>\n TBWA\\Australia<\/p>\n Leader: Kimberlee Wells<\/p>\n Headcount: 250 (est)<\/p>\n Offices: Sydney, Melbourne, Adelaide<\/p>\n Major clients: Telstra (through +61), NAB, Apple (Through Media Arts Lab)<\/p>\n Outlook: The Disruption agency has important clients and heritage. At a global level, Wren is understood to be a fan of TBWA and there are no indications the agency is under any threat. But could one of Omnicom\u2019s other agency brands be folded into it? There have been unconfirmed rumours TBWA could absorb DDB if that brand were to go.<\/p>\n DDB<\/p>\n Leaders: Sheryl Marjoran (Sydney), Mike Napolitano (Melbourne)<\/p>\n Headcount: 260 (est)<\/p>\n Offices: Sydney, Melbourne<\/p>\n Major clients: Coles, Dulux, TAC<\/p>\n 2024 B&T Agency Scorecard<\/a><\/p>\n Outlook: In Australia, DDB recently lost one of its longest client relationships (McDonald\u2019s), while adding another notable account in TAC. There have been reports the DDB will be retired and it has already been phased out in some markets. DDB\u2019s Australian team has produced outstanding work over the years, will this continue under DDB or one of Omnicom\u2019s sister agencies?<\/p>\n Note: 303 MullenLowe is majority-owned by Attivo Group.<\/p>\n Media agencies<\/p>\n OMD<\/p>\n Leader: Sian Whitnall<\/p>\n Headcount: 670+<\/p>\n Offices: Sydney, Melbourne, Canberra, Brisbane<\/p>\n Major Clients: Coles, McDonald\u2019s, Telstra<\/p>\n 2024 B&T Agency Scorecard<\/a><\/p>\n Outlook: OMD is Omnicom\u2019s flagship media agency with bluechip clients including McDonald\u2019s, Telstra, Qantas, Coles, Apple, Mazda, NSW Government and Victoria Government. It\u2019s business as usual for Australia\u2019s largest media agency.<\/p>\n PHD<\/p>\n Leader: Laura Nice<\/p>\n Headcount: 300+<\/p>\n Offices: Sydney, Melbourne, Brisbane<\/p>\n Major clients: Volkswagen, Bunnings, ANZ<\/p>\n 2024 B&T Agency Scorecard<\/a><\/p>\n PHD is undergoing its own leadership changes as Mark Jarrett passes the baton onto Laura Nice to step into a group role. Nice inherits an agency that has recovered after a bumpy period with some strong new business wins and momentum. It\u2019s unlikely there will be any changes to PHD globally or in this market.<\/p>\n Hearts & Science<\/p>\n Leader: TBC<\/p>\n Headcount: 130<\/p>\n Offices: Sydney, Melbourne, Brisbane, Perth<\/p>\n Major clients: Diageo, HSBC, Mercedes<\/p>\n 2024 B&T Agency Scorecard<\/a><\/p>\n Outlook: Long-serving Hearts boss Jane Stanley recently left the business to spend more time with her family in New Zealand. Omnicom will not replace Stanley until after the acquisition wash up and it is unclear whether the agency will continue under Hearts or potentially be combined with another, with UM rumoured as a potential merger partner.<\/p>\n UM<\/p>\n Leader: Anathea Ruys<\/p>\n Headcount: 320<\/p>\n Offices: Sydney, Melbourne, Brisbane & Canberra<\/p>\n Major clients: Australian Federal Government. Kmart Group, Dyson<\/p>\n 2024 B&T Agency Scorecard<\/a><\/p>\n Outlook: UM has had a rough ride as of late but still counts the Federal Government as a client. It\u2019s hard to envisage Omnicom 2.0 without UM in the mix, but could they be combined with another smaller agency stablemate?<\/p>\n Initiative<\/p>\n Leader: Jo McAllister<\/p>\n Headcount: 274<\/p>\n Offices: Sydney, Melbourne, Perth<\/p>\n Major Clients: Officeworks, WA Government, IAG<\/p>\n