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The changing agency landscape has set the stage for a particularly competitive earnings season for the major holding companies. After Publicis CEO Arthur Sadoun used the French agency group’s earnings call to make some pointed comments<\/a> about the merger between rival firms Omnicom and IPG, Omnicom chief John Wren took to the opportunity to ease concerns among clients going into the merger.<\/p>\n Following Sadoun’s comments that the US firms face “three years of hard restructuring leading to thousands of job cuts,” Wren assured clients and investors that cuts “will not impact employees dedicated to servicing our clients and generating revenues.”<\/p>\n Speaking on Omnicom’s Q4 earnings call, Wren said the company was confident in achieving $750 million in cost savings by streamlining the holding company’s “middle office and regional positions”, as well as eliminating duplicative and administrative costs.<\/p>\n A shareholder vote to approve the transaction is set for 18th March, and accounting for ongoing regulatory approvals, Omnicom expects to the deal to close in the second half of 2025.<\/p>\n Sharing is scaring<\/strong><\/p>\n In the meantime, Wren said Omnicom’s consultants were primed to advise or repitch to clients who were “considering making a change”. He noted that while most of the “heavy lifting” behind the merger has been completed, the two businesses would continue to operate independently until the closure of the deal.<\/p>\n Part of the concern appears to stem from restrictions preventing the two agencies from going into pitches together during the regulatory period, potentially causing uncertainty among shared clients.<\/p>\n “We cannot go and pitch some of these opportunities together, which would be the natural thing to do,” said Wren. “I have examples of a couple of clients that we actually share, and the only time that you’ll find an Omnicom and Interpublic person in the same room, is if the client insists on the meeting, because we’re not permitted to get there yet. But that’s the negative side of it.”<\/p>\n On the positive side, the process has enabled Omnicom to identify those clients who are interested in the combined offering of the two holding groups, according to Wren.<\/p>\n “I haven’t heard any concerns that we weren’t able to address,” he added. “As I said in my statement, we still do operate as two independent companies.”<\/p>\n “A very interesting year”<\/strong><\/p>\n Elaborating on the synergies created by the merger, Wren touted Omnicom’s Principal Media business as a “revenue upside” that it will bring to the combined entity, compared with IPG’s less mature proprietary media offering.<\/p>\n But Wren also cited the addition of “tools and activities that otherwise we didn’t have in our portfolio,” noting that IPG’s Acxiom data unit would enrich the company’s first-party data offering.<\/p>\n “We’ve had conversations to the extent that our lawyers will permit it with the Acxiom Group, and we see a whole suite of incremental products that will be brought into the joint company, and made available for the first time to Omnicom’s clients,” he said.<\/p>\n Wren claimed that integrating Acxiom with Omni and Flywheel Commerce Cloud (Omnicom’s data insights and commerce platforms, respectively) will provide “the most accurate identity solution and comprehensive understanding of consumer behaviours and transactions on the buy side.”<\/p>\n For Omnicom, the ability to link marketing to sales is key to its continued business wins and retentions; last year, the company topped agency benchmarking provider COMvergence’s rankings for new and retained business, with Amazon, Unilever and HP driving more than $7 billion in new business during 2024.<\/p>\n Overall Omnicom posted 5.2 percent YoY organic revenue growth in Q4, below Publicis’ reported growth of 6.3 percent. The group also issued a more cautious outlook for 2025, with organic revenue growth forecast in the range of 3.5-4.5 percent. The company’s share price dipped slightly following the results.<\/p>\n “2025 is going to prove to be a very interesting year, with all the changes in the US government, plus some of the policies that they’re considering and the implications they possibly have on things like the auto sector and other sectors,” said Wren. “We’re not pessimistic. We still remain optimistic, but I think we’re going to be conservative at this point in the year, until we get a little bit further along, and a bit more guidance from our clients.”<\/p>\n Follow VideoWeek on Twitter<\/a> and LinkedIn<\/a>.<\/p>\n