The collapse of the Omnicom and Publicis merger is evidence that in a fast moving, digital world “big is not a strategy”, marketing consultant Avi Dan has argued.
Dan, founder and CEO of Avidan Strategies, has dismissed reports that the failed marriage was due to ‘cultural differences’ and said it failed simply because “there was nothing in it for the clients”.
In his Forbes piece Dan writes: “WPP has 175,000 employees and a market cap of $29 billion. Google has 47,000 employees and a market cap of $353 billion. Scale is not as relevant as it once was.”
He said that clients have moved on from one agency of record to many and that the holding company’s ‘under one roof’ selling point “doesn’t manifest itself in reality” because their agencies silo their profits into separate P&Ls.
“Clients don’t seek scale. They seek collaboration,” he said.
The responsibility for fostering collaboration also falls to clients, Dan argued, pointing to the need for a remuneration strategy that “incentivizes sharing, not exclusion”.
His opinion piece is in response to news that the Omnicom Group and Publicis Groupe merger, which had been on the cards since July last year, had collapsed.
The merger was also criticised by WPP chief executive Sir Martin Sorrell who predicted it would be “structurally clunky”.
Also see B&T’s report ‘Steedman: ‘Massive task’ ahead for Publicis Omnicom’.