Publicis Groupe (France)

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Publicis Groupe has forced its way into the top ranks of the world's leading marketing organisations through a string of canny and transformational acquisitions. Having learned painful lessons from a disastrous alliance with FCB during the 1990s, CEO Maurice Levy's acquisition of Saatchi & Saatchi in 2000 proved far more harmonious. Even more impressive was the agreed takeover of Leo Burnett two years later. Other jewels in the Publicis crown include multi-hub creative networks Bartle Bogle Hegarty, wholly owned since 2012, and Fallon. After a shaky start, Publicis has shown itself to be a worthy rival to established giants WPP and Omnicom. The group is especially strong in digital marketing. It acquired US-based Digitas in 2006, and broadened that network's footprint significantly. A deal to acquire rival digital agency Razorfish in 2009 allowed Publicis to overtake Interpublic as the world's third largest marketing services group. A series of further small and medium-sized acquisitions followed between 2010 and 2012, capped in 2013 by what was intended to be CEO Maurice Levy's crowning glory, a transformational deal whereby Publicis and larger rival Omnicom would merge to create the world's #1 marketing services giant. Despite securing most regulatory approvals, the deal eventually foundered on disagreements over the final structure of a combined group and was called off in May 2014. Instead, Levy unveiled a new deal a few months later with an agreement to acquire digital group Sapient for $3.7bn. However, the group's performance slumped dramatically following the collapse of the Omnicom deal, prompting a mammoth structural reorganisation during 2016. It fell to Levy's successor as CEO, former creative chief Arthur Sadoun, to restore Publicis to solid growth. That has been a slow process, but there was finally a return to consistent positive uplift during 2018. In 2019, though, Publicis announced its biggest ever acquisition, agreeing to pay $3.95bn for US data and CRM giant Epsilon.

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Adbrands Account Assignments tracks account management for the world's leading brands and companies, including details of which advertising agency handles which accounts in which countries for major markets. See also:

Publicis Worldwide
Leo Burnett
Saatchi & Saatchi
Starcom MediaVest
ZenithOptimedia
BBH
DigitasLBi
Rosetta
Publicis Healthcare
MSLGroup
Fallon

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Recent stories from Adbrands Update:

Adbrands Daily Update 14th Nov 2019: With all results now in, Omnicom led the pack for 3Q with organic growth of 2.2%, followed by Interpublic at 1.4% and WPP on 0.7%. Havas was flat at 0.0% ahead of Dentsu -0.1%, Publicis -2.7% and MDC Partners -7.5%.

Adbrands Daily Update 8th Nov 2019: Publicis Groupe is tipped to have been selected as winner of global Nivea creative, with WPP awarded Beiersdorf's supporting brands Eucerin, Hansaplast Labello and so on. Confirmation is still awaited. Publicis had been competing in a final shoot-out with WPP's Thjnk and Wunderman Thompson agencies. FCB is the departing agency. It's the latest in a series of strong gains for the French group. Also this week, Publicis retained global creative for Axa and gained media in the insurer's four key markets of France, the UK, Germany and Italy. (WPP's Wavemaker got the rest of the globe). The French group also won EMEA creative and media for McCormick spices, and recently collected a big win from Disney. The key question, though, is how much Publicis is prepared to give away in fees to achieve these wins. It has already racked a succession of significant wins during the first nine months of this year, and yet organic revenue growth for the latest quarter was the Groupe's worst ever, and it is firmly in the red for YTD growth. Judging by the headline wins alone, one might reasonably have expected better growth numbers.

Adbrands Daily Update 15th Oct 2019: Omnicom Media Group retained the bulk of the business of Disney's North Amerian media channels following a major global review worth over $2bn in billings. That includes the Disney, Fox, Pixar, Marvel and other movie studios as well as ABC, ESPN and other broadcast and cable strands. A new dedicated agency, OMG23, is being created to manage the business. However, Publicis Media has been awarded all international entertainment assets as well as the soon-to-launch Disney+ streaming service worldwide and Disney's global Parks & Resorts division, previously held by Carat. It's an important counter to the Groupe's poor Q3 results, unveiled earlier than expected last week. (Was the timing arranged to get the bad news out of the way in time for this week's good news?) WPP is reported to have retained Disney's business in India.

 Adbrands Daily Update 11th Oct 2019: Publicis Groupe's usual big talk about its unique operating model and ground-breaking innovation was once again undercut by poor results. Reported revenues for the latest quarter rose by 17% to €2.58bn, fed by a succession of big acquisitions. However, organic performance, with acquisitions and exchange rates stripped out, slumped by 2.7%, the Groupe's worst quarterly decline in several years. It clearly expects much worse to come in the current quarter, predicting a full year decline of 2.5%, from only 1.4% for the nine months to-date. As usual, CEO Arthur Sadoun opted to portray the Groupe's strategy in positive, even heroic, terms. "We could have chosen the easy route and taken advantage of the status quo to find small pockets of immediate growth," he said in a statement. "Instead we are accepting this painful situation in the short-term, to be better prepared for the future."

It remains to be seen whether this dip is an industry problem - the other marketing groups don't report until next week - or a Publicis problem exacerbated by disruption from a succession of big structural changes. On a regional basis, the Groupe's two biggest markets of North America and Europe both delivered steep organic declines of 3.6% and 3.3% respectively. Important individual territories contributed to those falls: Germany down 5.3%, the US down 4.9%, the UK down 3.9%, even the home market of France down 0.8%. Latin America - a small market but one in which Publicis has invested heavily through acquisition - plunged 7.2% on the back of a shock 15% plunge in Brazil and over 9% in Mexico. Asia Pacific and Middle East/Africa were both positive.

 Adbrands Daily Update 20th Aug 2019: There's little chance of Arthur Sadoun letting dust settle on the Publicis chequebook any time soon, it seems. Hot on the heels of completion of its Epsilon takeover, the Groupe agreed the purchase of US datatech and CRM agency Rauxa. No terms were disclosed, but Rauxa has revenues of around $70m annually. Headquartered in Costa Mesa, California, it employs 320 people in six offices around the country. Founder-owner Jil Gwaltney will continue to lead the business, which is joining the Publicis Media division, alongside Starcom, Zenith, Digitas and Moxie, among others.

 Adbrands Daily Update 19th Jul 2019: Publicis narrowly scraped into positive growth in 2Q, with an organic uplift of just 0.1% after two consecutive quarters of negative results. Revenues came in at €2.2bn. Europe was solid at 2.4%, while Asia Pacific contributed 2.7%. However, Publicis is still struggling in North America - down -1.7% - while Latin America slumped -8.7%. CEO Arthur Sadoun said "our progress has been slowed down by the ongoing fee reduction on traditional advertising that continued to impact our overall US operations". That is encouraging further consolidation of local operations under a single country head. "Where it is the most advanced," he said, "this model is already working very well. This is the case in the UK and France, with net revenue in H1 growing by 4.8% and 3.1% respectively." Net income for the half year (Publicis doesn't repoort quarterly profit) was €345m, up almost 15%.

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