The penned merger of equals between Publicis and Omnicom takes two large networks of agencies and folds them into one behemoth holding company significantly larger than WPP, which would fall into second place. To gain strength in building a future, Publicis has been aggregating large digital shops to complement its traditional creative agencies; at the same time, Omnicom has been amassing a large contingent of small shops that grew quickly under its Diversified Agency Services (DAS) umbrella of digital firms in the race to lead the "new" thing.
Why merge now? The ad agency world and the technology world are on a collision course, centered on how well companies manage their business or consumer customer. I first mentioned this in a post about change management in my Forbes blog almost exactly one year ago. As agencies find themselves up against tech services giants like IBM, Accenture, Sapient and Deloitte, they are being asked to deliver:
Marketing and business strategy based on deep data. No marketing strategy is competitive today without the strength of managing and interpreting data. Both firms have invested in disparate platforms to build insight into the planning process. Agencies like Rosetta and RAPP use data to inform the strategy to build customer engagement, getting ad efforts closer to Moneyball-like results.
I was driving home from work the other day and listening, as usual, to Boston's National Public Radio station, WBUR, when a story came on about the push for doctors and hospitals to go digital by turning patient records into electronic health records (EHRs). There are a lot of tricky challenges that come with digitizing these documents: hundreds of products on the market to help with the effort, a steep upfront cost, lower productivity on day to day tasks while the system is implemented, the cost of accompanying hardware and maintenance, and a learning curve for doctors, nurses, and other staff. But as one of the office managers said for the story, the biggest challenge is actually "having everybody have a positive attitude to do it. If we can all keep positive and get through it and learn it...I think we'll be okay." Supporters of this effort cite improved cost and better, more efficient care - a win for all stakeholders - but in the early stages, it's hard for some to see tangible improvements.