Nadia Shchipitsyna
By Nadia Shchipitsyna
Oct 20, 2017 1:00:00 PM

Accenture Buying Publicis Groupe

On this week's episode of #MediaSnack we look at the gathering rumours (and plausible evidence) that one of the major advertising holding companies will be an acquisition target by one of the big consultant or audit firms.

These whispers first became acknowledged in Cannes this year when a few people were suggesting a WPP / Accenture merger was being discussed, which WPP quickly refuted. We take a look at two companies that might be in the mix of acquisition talk, Accenture Interactive the 'agency'-like division which has been on an acquisition spree in recent years, most notably buying some creative agencies like Karmarama outright.

We compare the relative sizes of Accenture and Publicis to highlight that the consulting giant does indeed dwarf the French marketing services group both in revenues and headcount by more than 4 times. The fortunes of the company are equally different, Accenture has seen a progressive rise in share price over recent years in a straight line that has seen 70% growth, whilst Publicis is at the same level today as it was two years ago. Publicis is likely to be one of the major holding companies which are best positioned to sell, or be bought. The challenge and arguments over leadership which caused 2013's failed Publicis Omnicom merger would seem to be removed with the departure this year of long-standing CEO Maurice Lévy. His successor Arthur Sadoun, who has continued Levy's restructure of the group and is understood to be readying the business for a leaner future, is less likely to be an obstacle to a merger or acquisition. The due diligence prepared ahead of the failed Omnicom deal from 2013 would have given Publicis Groupe a good insight into their business, its strengths and weaknesses and synergies of integration. They will know that the consulting groups still covet Sapient their digital consulting business and would also be keen to acquire stellar agency brand names like Saatchi, BBH and Burnett.

We would anticipate a deal like this within the next 6-12 months. But if Accenture is the most likely to buy and Publicis the most likely to sell then is this the perfect marriage? Cultural alignment could be a barrier, although the fact that Accenture has a French CEO might alleviate Publicis shareholder concerns. An alternative might be for Accenture to look at fellow American IPG, whilst the French consultancy Cap Gemini has made noises of their interest in a future acquisition and so might make a better suitor for Publicis.

 



On this week's Good Week Bad Week we celebrate the fact that its a good week for the eager next generation of media agency leadership as 4 agency CEO's announced their departures in the same week leaving gaps for fresh new ideas and new leaders. It has been a bad week for Dentsu-Aegis Network in the UK as their largest client, and one of the UK's largest advertisers, the UK Government announced a review of the contract and a £140m buying pitch planned to start in February next year. The government's lead marketer Alex Aitken has laid out a bold agenda to drive greater transparency this time around and focus on greater value creation from media buying not cost price reduction. ID Comms attended the initial agency briefing on Thursday at HM Treasury with leaders of the UK's major networks agencies and independents, we were pleased to see the government open to a more collaborative approach, setting up a process which will seek input from agencies on the process itself in advance.



Good Week:

http://www.thedrum.com/news/2017/10/06/pippa-glucklich-leave-starcom-uk-ceo-role-after-5-years
https://digiday.com/marketing/havas-uk-ceo-paul-frampton-leave-group-later-year/

http://www.campaignlive.co.uk/article/tracy-de-groose-step-down-dentsu-aegis-network-uk-ceo/1446922

https://newsroom.accenture.com/news/accenture-appoints-nikki-mendonca-as-president-of-intelligent-marketing-operations.htm


Bad Week:

http://www.campaignlive.com/article/government-launch-140m-media-buying-review-with-transparency-heart/1446551
http://ccs-agreements.cabinetoffice.gov.uk/node/7138