To Win, Omnicom Must Kill Its Darlings

Now that the $13 billion merger between Omnicom and IPG is definitely taking place, all consideration turns to what the merged entity will appear to be. It’s going to get bloody as a result of this can be a merger of equivalents. Each have large inventive companies, digital media, PR companies, and so forth. Each run a “home of manufacturers” structure. And to make issues worse, the merging corporations aren’t geographically distinct both. I see three attainable situations.Possibility 1 – The Diplomatic HandshakeThis light possibility, the place everybody retains their nook workplace, preserves the massive six inventive networks primarily untouched: BBDO, DDB, TBWA from Omnicom, and McCann, FCB, MullenLowe from IPG all survive the cull. This situation is the trail of cowardice, and that’s exactly why it has a preventing likelihood. The argument is easy: it’s designed to reduce shopper defections and any expertise exodus. When WPP merged JWT and Wunderman, they misplaced Vodafone. When Publicis consolidated, shoppers fled. Maintaining all six inventive networks intact means no CMO has to clarify to their CEO why they’re out of the blue sharing an company with their largest competitor. However right here’s why it gained’t occur: Wall Avenue. Omnicom Chairman and CEO John Wren promised $750 million in synergies. You don’t get that by doubling headcount and retaining all of the logos. You possibly can’t keep six P&Ls, six administration groups, six finance departments, and 6 egos whereas delivering the price financial savings that justified this complete $13 billion journey. Extra alarming nonetheless, this method fails to handle the basic downside: Publicis has been consuming each corporations’ lunches with a simplified mannequin for years. Taking part in it secure now’s the riskiest transfer of all. Nobody thinks it’s going to occur.Possibility 2: The WPP PlaybookNow we’re speaking. This follows Mark Learn’s WPP template: merge the also-rans whereas defending the crown jewels. DDB and TBWA develop into one entity as a result of, actually, can anybody outdoors the trade inform them aside anymore? FCB absorbs MullenLowe in a “merger of equals” that everybody is aware of isn’t. The Martin Company? Deutsch? They develop into “facilities of excellence” inside the greater networks, which is company communicate for “your P&L now rolls as much as another person, don’t purchase that new residence”. That is the place the true financial savings emerge. One finance workforce, one HR division, one very nervous workforce questioning in the event that they’ll survive integration. It’s brutal effectivity wrapped in a strategic narrative that the market will purchase. And that previous chestnut about shopper conflicts is now not a powerful sufficient excuse for multiplicity.The good cash bets that is the result as a result of it’s been beta-tested and board-approved. WPP already proved you possibly can merge Wunderman Thompson with VMLY&R with no important repercussions. The DDB-TBWA merger additionally makes brutal sense. Each are creatively revered, however commercially challenged, stronger collectively than dying individually. FCB-MullenLowe is much more apparent.4 inventive pillars offers the brand new firm sufficient manufacturers to handle conflicts whereas delivering financial savings via back-office consolidation. The killer app right here is that it follows a longtime playbook. Personal fairness companies love “confirmed fashions,” and John Wren is actually working a PE play right here. The chance mitigation is ideal: radical sufficient to ship synergies, conservative sufficient to keep away from shopper revolt. It’s the Goldilocks technique, which in company America means it’s virtually definitely what is going to occur.The one query is whether or not it’s radical sufficient for the long run? In 2024 this could have been a useless cert. However WPP will not be prospering, and the world of promoting solely will get harder and extra disrupted as you learn this. Possibility 3: The Nuclear Various That is John Wren going full Thanos. Two inventive manufacturers. That’s it. BBDO McCann turns into the premium providing, the Mercedes-Benz of promoting. DDB FCB turns into the challenger model. Tesla, if you’ll. TBWA’s model fairness? Who cares? MullenLowe’s heritage? Irrelevant. The Martin Company’s independence? A luxurious they’ll’t afford. However right here’s the genius bit: they create a single platform entity – Omni Cloud – that handles all media, all knowledge, all digital, all commerce. One P&L. One system. One throat to choke. It’s Publicis’s Energy of One on steroids. Purchasers get simplicity. Shareholders get margins north of 20%. And the trade will get what it most likely wants greater than something: a actuality test that the period of brand name proliferation is over. This isn’t simply consolidation; it’s promoting’s Nice Reset.That is certainly the right reply, and certainly not the one that can emerge.Two manufacturers, one platform. It’s what McKinsey would suggest, what shareholders dream about, and one thing that may truly compete with Publicis’s Energy of One. However right here’s the tragedy: promoting persons are nostalgic. They will supply nice recommendation to shoppers, however run their very own companies extremely poorly. Level promoting folks at a shopper in an identical state of affairs, and there can be a unanimous push for consolidation. However these docs by no means heal themselves, and the board doesn’t have the stones for this stage of disruption. The Nuclear Possibility requires a wartime CEO, not John Wren, who for all his important qualities, is a peacetime basic managing decline, not revolution.Probably the most profitable mammal on the planet is the brown rat. They dominate our planet. And the rationale for his or her populous success is grisly: the mom rat will, if confused, threatened, or hungry, cull a major proportion of her brood. It’s a horrendous however basic act that ensures her survival, and the survival of the strongest of her litter.This merger is a once-in-a-lifetime alternative to focus and evolve. And the query on the coronary heart of all of this isn’t which manufacturers the brand new firm ought to kill. That at all times results in a gentle and partial reply. The right query is what number of manufacturers the brand new firm must succeed.Mark Ritson will train the ADWEEK MiniMBA in Advertising in April 2026, a ten-week MBA stage program for senior managers who by no means obtained (or have utterly forgotten) correct advertising and marketing coaching. Join right here.