Omnicom becomes the world’s largest agency holding company

Through its $13.25 billion acquisition of Interpublic Group, Omnicom has vaulted past WPP to become the world’s largest agency holding company. Omnicom and Interpublic separately were the third and fourth largest global ad buyers. The deal is expected to attract regulatory scrutiny.

Among the agencies owned by Omnicom are BBDO and TBWA, while Interpublic owns McCann, Weber Shandwick, Mediabrands and others. The remaining five members of the “big six,” with which the new giant will compete, are Dentsu, Havas, IPG, Publicis and WPP.

The technology angle. These holding companies and the agencies they support are struggling against the challenge presented by newer technology companies like Google and Meta which have become, fundamentally, advertising businesses. At present, Google and Meta offer sophisticated tools to create advertising content and vastly popular channels in which to deliver it.

One clear trend among the holding companies is the blurring of lines between the agency practice and marketing technology. In particular, they are now heavy investors in artificial intelligence. Publicis Groupe announced in January plans to evolve into an “intelligent system” through a 300 million Euro investment in AI capabilities. Dentsu was an early adopter of Microsoft 365 Copilot. WPP said it will find $317 million to invest each year in the data and technology underpinning its AI strategy. In 2023, Omnicom launched Omni Assist, a genAI solution developed in partnership with Microsoft.

Dig deeper: How the big holding companies are handling genAI

Why we care. As Google and Meta look more and more like media companies (pending the consequences of Google’s antitrust loss, of course), the holding companies and their agencies look more and more like martech. As we’ve said for a long time, martech is marketing. And martech is advertising too.

The analyst’s angle. Jay Wilson, VP analyst for Gartner’s marketing practice, said: “This is certainly a big deal — holding companies have been consolidating their stables of agencies for some time, in the hopes of providing a more comprehensive, streamlined solution to clients. This kind of goes in the opposite direction, making for a single, rather complex holding company.”

He also speculates that this might be good news for the larger independent agencies that might be more appealing to clients than a “mega agency holding company.”

Similar views were expressed by Jeremy Haft, CRO at performance marketing company Digital Remedy. “The deal signals a shift towards greater concentration in the ad industry. Larger entities will continue to dominate the space, but this could also open the door for independent agencies. With the combined Omnicom/IPG entity controlling more of the major brands, smaller clients may look to independent agencies for a more personalized, competitive offering — creating new opportunities for agencies that might have previously been shut out of the biggest opportunities. Ultimately, the merger could foster more competition in the marketplace, encouraging agencies to innovate, drive effectiveness, and deliver growth rather than simply competing on pricing.”