At the same time, as Omnicom and Interpublic Group approach the final stages of the former acquiring the latter, the slow but steady brain drain continues — with Omnicom set to lose a key architect of its Omni orchestration platform right when Omni is about to absorb IPG’s data assets and tools, housed in Acxiom and Kinesso. And although Omnicom moved immediately to ensure a smooth transition on that front, the timing isn’t ideal for either company, as two different massive data and tech systems have to learn to integrate.  

So, is the industry — as embodied through WPP and Omnicom’s moves — about to embark on the sea change everyone agrees needs to happen? That the holdco model, as it has been executed for the last 20 years, now feels archaic and creaky, and needs major shakeups to transform? In the case of WPP, it’s a bold move bringing in an outsider to run the business, and whether it pans out or not remains to be seen. And in the case of Omnicom, absorption of a whole other holdco is going to challenge it like never before — but also increase its chances of becoming the big dog in the yard.

Let’s look at WPP, with the handoff from the Mark Read era to the Cindy Rose era officially underway. Read, regarded as equal parts cold fish and straight shooter, ends his tenure on a downtrodden financial note. 

“We now anticipate H1 like-for-like revenue less pass-through costs to decline by -4.2% to -4.5%, with a decline of -5.5% to -6.0% in Q2, which, although impacted by one-off factors, is below our expectations,” read a statement from the holdco last week — it will officially release results for H1 on Aug. 7. Forecasting for H2 is no better, as the statement has adjusted revenue from flat/-2% to -3/-5% for the year. 

While not surprising since WPP lost more clients than it gained, the results call into question how much it should be focusing on a wholesale redo rather than getting its core business back on track — not an easy feat in an ever-changing marketplace. 

Read tried to address this very notion the day before Rose’s hire was announced. “Our focus remains on ensuring the right balance between investing in the business for the long-term and continuing to reduce structural costs, while taking appropriate actions to respond to the current trading environment,” he said in WPP’s trading update.    

“On the one hand, you know the old agency model is a relic, right? But there’s still something to it — there’s still something to that Rolodex, that [Omnicom COO] Daryl Simm has, or whoever else has done those jobs and knows those challenges, which I wouldn’t underestimate,” said one executive who’s worked on the agency side, the media side and the consultancy side. “I wish [Rose] luck, and she may be super successful at it. But I think there is an element of people who really understand the client pain points and can articulate that. Maybe she’s a fast learner and she’ll get it right away. Or maybe there’s enough other legacy WPP people that compensate for that, and it’s a non-issue. But that would be something I’d watch for.” 

Given WPP’s still-dismal state of financial affairs, now might not be the right time for a technocrat, said the observer. “This is clearly a tough time for WPP — does this help transform them and help them get back on the front foot for those pitches? I don’t know the answer, but clearly someone who knows the pitch process and can execute it is required.”

Jay Pattisall, vp and senior agency analyst at Forrester, agreed Rose has her work cut out for her, but points to her operational acumen as what’s needed to put into action the moves Read has made to prepare for a turnaround and transformation. 

“It’ll be a tricky needle to thread, in some respects, being able to balance the the need to transform and modernize WPP with its current services, construct and model,” said Pattisall. “They’ve got to reconcile the fact that the company will be smaller but smarter because of automation, and then they’ll need to facilitate that automation. The way that they work will need to continue to transform to be more platform-centric and solution centric, as opposed to just hours up against a scope.”

Changing remuneration anywhere in the holding company world will be the trickiest task of all, Pattisall added, because it’s going to require both agency and client to adapt to most likely an outcomes-based model, and that carries all manner of fiscal uncertainty, which is the bane of any CFO or procurement exec.  

As for Omnicom and IPG, both companies have kept plans so close to the vest, it’s hard to see where they are headed. They’ve had to keep it that way out of fear of governmental roadblocks being put in place, most of which have seemingly been cleared in the U.S. but not as much on a global level. That hasn’t stopped some executives at both companies from departing — perhaps the result of restlessness combined with uncertainty. 

On the IPG side, Andrea Suarez just left her global CEO role at UM, as did Dimitri Maex from his global president role at Mediabrands, trimming its leaders by attrition. On the Omnicom side, there’s been some loss of investment executives, including former OMG head of investment Geoffrey Calabrese and OMD head of investment Kelly Metz. Slavi Samardzija’s upcoming departure as global CEO of Annalect signals potential change on the data and tech side. The end result is both holdcos seem to be organically trimming the rosters in preparation for what will in the end be a giant.

But how will all the tech and data assets from both holdcos fit when they come together? That remains one of the biggest wildcards and unknowns of a merged Omnicom/IPG. Samardzija was hugely respected within Omnicom for being a key architect of Omni, which some would say is the best operating platform of all the holdcos. Losing him at a time when Omni will be united with IPG’s data and tech assets feels like a risk for the holdco. But internally, execs there feel secure that Adam Gitlin who has operated at Samardzija’s side since 2016 as president of Annalect, will be able to fill his shoes ably. 

Time will ultimately tell for both holdcos — WPP with its new leader, and Omnicom with its absorption of a longtime rival. 

Color by numbers

IPG’s media investment unit Magna and SSP Magnite surveyed 2,800 digital audio listeners to better gauge what drives successful programmatic audio campaigns. Digiday got first crack at examining the results, and there are some interesting findings. —Sam Bradley

They include:

• Audio listeners are already primed for conversion tactics. 61% of listeners said they’d pay more attention to audio spots when a promotion was included.
• But variation in creative, and clever sequencing, matters: campaigns that paired a brand awareness message, with another ad serving up a more sales-oriented message, generated 17% lift in unaided ad recall and a 9% lift in purchase intent, too.
• Repeat ads worked better for new customer acquisition than for re-engaging past shoppers. New customers were 5% likelier to purchase when exposed to the same ad running twice, than they were when exposed to multiple ads across a campaign each running once.

Takeoff & landing

• Comvergence released its full-year 2024 numbers on media agency billings and performance. In short, among media agencies, OMD generated the most total billings of $26.3 billion, followed by EssenceMediacom at $24.6 billion, and Mindshare at $21.9 billion. At the group level, At the group level, WPP Media stayed atop the rankings with a 14.2% market share, followed by Publicis Media with an 11.9% share and Omnicom Media Group ranks third with10% share. Together, the three represent 71%of total billings among the Big 6. 
• Stagwell launched what it’s calling the Stagwell Media Platform, a centralized team of media, technology and data experts tackling addressable media using agentic principles to optimize trading and investment. The unit is led by global CEO Matt Adams, who’s also COO of Assembly Global, and Marissa Jimenez joins from Dentsu to become global chief trading and solutions officer at SMP.
• The Joint Industry Committee addressing measurement issues last week said it completed the audit of new methodologies from Comscore, iSpot and VideoAmp, passing each of them to maintain their certification.

Direct quote

“Linda’s farewell tweet is interesting to say the least, as she boldly claims success in ‘turning the company around’ and ‘restoring advertiser confidence’, neither of which is true. We are again witnessing the sadly popular playbook of loudly blowing your own trumpet, claiming successes that aren’t real, never admitting to mistakes, and blaming all setbacks on other people and external factors.”

— Ruben Schreurs, CEO of media management firm Ebiquity, on Linda Yaccarino’s departure from X as CEO.

Speed reading

• Kimeko McCoy looks at the mid-tier creators being left behind despite the massive cash infusion the growing marketing tool is getting. 
• Speaking of creators, Seb Joseph delves into marketers’ call for greater discipline and rigor in determining the right ones to work with and how to evaluate their success. 
• I wrote about the reasons for media agencies to go the ESOP route (you’ll have to read the story to find out what the acronym stands for) and what the potential drawbacks are. 

https://digiday.com/?p=583107