The $13 billion merger between Omnicom Group and Interpublic Group (IPG) would establish the largest holding company globally, altering the competitive landscape. This consolidation raises critical questions for advertisers: What does this mean for your brand, your agency relationships, and the broader market ecosystem?
At Ebiquity, we see this merger as a reflection of the deep structural challenges facing the industry. At a time when advertisers are demanding greater transparency, innovation, and measurable outcomes, the creation of a larger holding company brings both opportunities and complexities. Here’s what this shift means for brands and the steps you should consider taking to navigate this transition.
A Landscape Redefined: Opportunities and Challenges
1. The Power Play for Scale
At its core, the Omnicom-IPG merger aims to scale trading volume, data capabilities, and end-to-end solutions, while increasing market leverage and fueling inventory media offerings. Scale remains a powerful tool, but competing on volume, product, or price alone reflects priorities of an old era.
In a market where 61% of media investment flows to platforms like Google, Meta, and Amazon, scale alone no longer guarantees differentiation. For brands, the critical question is whether this consolidation will deliver better guidance, transparency, and innovation to address today’s advertising challenges. True value lies in pairing scale with precision, creativity, and integrated capabilities that meet modern advertiser needs.
2. Regional Dynamics Persist
While this merger creates a global powerhouse, regional nuances remain pronounced – such as:
- North America: The new entity will claim the top position, though the market features a significant percentage of clients using mixed models, with independents often managing digital services.
- EMEA: GroupM is projected to maintain its leadership.
- India: GroupM continues to dominate the market.
- China: The Omnicom-IPG entity is expected to remain in third place among holding companies, while independents maintain a strong presence.
- Japan: Dentsu holds a unique position as both a media owner and agency, consolidating significant market influence.
- LATAM: The region follows a distinct model, led primarily by creative (Rankings based on Comvergence 2024 projections)
These variations mean that a (single) global holding group may still struggle to address highly localised advertising needs, particularly in emerging markets where agility and specialised knowledge are paramount.
3. Agency Consolidation and Talent Redundancies
As the new entity integrates its operations, the drive to achieve $750 million in cost savings could lead to redundancies that risk disrupting established agency expertise. For existing clients, this may mean challenges in maintaining continuity and quality of service.
More broadly, talent loss also raises concerns about the industry’s ability to adapt and innovate in a marketplace increasingly defined by digital-first players and emerging technologies like AI
4. Data and Technology Integration
Omnicom has long championed a “neutral, client-first approach to data,” prioritising advertiser needs over proprietary ownership. This philosophy contrasts with IPG’s investment in platforms like Acxiom, which offers advanced data-driven marketing capabilities. The merger presents an opportunity to potentially create a strategy more in line with industry leader Publicis, leveraging the combined Omnicom-IPG scale to compete more effectively. However, brands must carefully evaluate how these changes align with their goals for transparency, accountability, and effective data management to ensure they maintain control over their customer insights.
5. Market Concentration and Competitive Impact
Regulators will closely examine whether this merger limits contestability or stifles innovation in the market. Advertisers should advocate for safeguards that preserve competition and ensure the continued availability of independent agency partners.
Across various categories and clients, maintaining a competitive agency ecosystem has proven effective in driving accountability and optimising performance. However, the consolidation of holding groups may introduce challenges to preserving such diversity and competitive dynamics.
Contractual Priorities for Navigating the Omnicom-IPG Merger
A merger of this scale will inevitably impact operational processes, resourcing, and agency contracts. Advertisers need to ensure their frameworks are robust and prepared to manage these changes effectively. By addressing the following contractual priorities, brands can safeguard their investments and mitigate potential disruptions:
- Operational Changes and Resourcing Risks:
The merger’s predicted $750M (USD) in annual savings will likely in part stem from shared service centres and operational streamlining. While this may improve efficiency, it could also lead to redundancies across back-office teams (e.g. finance) and client-facing roles (e.g., traders and client account management). Advertisers should ensure their contractual agreements are robust, with clear resourcing commitments and mechanisms to reconcile any service gaps or cost pass-backs.
- Rebate Negotiations and Buying Power:
As the largest media buyer globally, the combined entity will have unparalleled negotiating power. While this could unlock greater rebates, the benefits must be transparently passed back to clients. Advertisers should regularly audit their contracts and rebate structures to ensure they maximise value.
- Proprietary Media and Transparency:
Omnicom’s established emphasis on Inventory/Proprietary Media may become a more prominent offering for IPG clients post-merger. While such solutions can enhance efficiency, they also risk introducing non-transparency. Advertisers must ensure their contracts include provisions to safeguard transparency while still capturing any potential benefits.
By proactively addressing these considerations, advertisers can protect their media investments and turn potential disruptions into opportunities for improved outcomes.
