We’ve recently learned of the birth of the Publicis Omnicom Group – assuming it passes anti-trust inspections – and my excitement can hardly be contained. This is precisely what the world needed: A monster communications agency (advertising was relegated to second place as a descriptor) making $25 billion in combined revenue, with offices around the globe and more than 130,000 employees.
Those employees must be thrilled knowing there is roughly $500 million to be saved by the new mega-group, and where do we think those savings are coming from? According to messaging from POG, it will come from cheaper insurance policies and better negotiating power for pencils, desks and chairs, of course. No fool would buy that story. There is not a single word about layoffs, the likely source of the savings. On top of that, only one lead law firm and accounting firm will be needed. Think about how this news has affected those service firms for a second.
If I were an employee of either firm and had any entrepreneurial ambitions, I’d sure be thinking about leaving. Soon enough, you’re going to see a ton of resumes from high-caliber talent hitting the streets.
Right now, there are two winners in all of this: John Wren and Maurice Levy. They are going to make out like bandits. And as if this deal wasn’t suspect enough, Wren and Levy are planning to run things as co-equal CEO’s. Not only does this almost never work, it often turns into disaster.
And what about the existing clientele? Well, they’ll be given some nonsense about great buying power as a rationale for why they should remain with POG. However, smarter clients will understand what this deal really means, as it will be sayonara baby for many of them (perhaps I was thinking of Dentsu).
Deals of this size are done for two reasons and two reasons only: power and money at the top. Don’t believe anything else you hear.