Tuesday, August 6, 2013

Should Omnicom Merge With Publicis

Madison Avenue advertising titan Omnicom and France's Publicis have announced their merger,resulting in a firm with a combined worth of just over 35 billion dollars,with more than 130,000 employees.The deal promises to achieve 500 million dollars in cost savings and a combined annual revenue of around 23 billion.The deal could face objections by regulators fearful of the decreased competition in the advertising industry that would result.*Omnicom CEO John Wren will eventually become sole CEO of the combined firm,and Publicis CEO Maurice Levy will be non-executive chairman after a period of being co-CEOs.The new company will be stronger in the emerging markets and better equipped to compete with Google and Facebook in the digital ad realm.Most of the time,Google collaborates with Omnicom,Wren said;sometimes it competes with us.*Omnicom faces a new world.Revenue is slowing down on the difficulty of adjusting to new places where the ads go,Google and Facebook's new way to advertise,according to Julie Roehm,Senior Vice President of Marketing at SAP.The merger makes perfect sense.It's a very good opportunity for them and their customers,taking the inefficiencies to invest them in big data and analytics.Mobile is a huge opportunity.Very few companies have cracked that code.They're going to take traditional creativity and merge it with the digital side.They are representing lots and lots of customers.They want to get ahead of the ball,Ms.Roehm noted.*Omnicom Group Inc(OMC),Publicis Groupe SA(Paris:PUB)

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