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Omnicom-Publicis megamerger touches 3 Twin Cities agencies

  • Article by: David Phelps
  • Star Tribune
  • July 29, 2013 - 9:42 PM

 

The world’s largest ad agency merger will tweak the Twin Cities advertising market too.

Three Minneapolis agencies will be affected by the pending megamerger between Omnicom and Publicis announced over the weekend. But an immediate impact on the agencies is unlikely, industry experts acknowledge.

“A lot of these mergers happen at the highest levels apart from the day-to-day operations at the agency level,” said John Purdy, a professor of advertising and public relations at the University of St. Thomas whose background is in the agency world.

The three Minneapolis agencies affected by the Omnicom-Publicis merger are Martin Williams and BBDO Proximity, both of which fall under the Omnicom umbrella, and Fallon, which is part of the Publicis family.

“It’s business as usual, and our day-to-day operations will not be affected,” said Fallon CEO Mike Buchner in an interview Monday. “However, when the deal is completed, sometime in fourth quarter of this year or first quarter next year, Fallon and its clients will have access to a deeper pool of global resources and broader capabilities than we have today.”

Fallon’s client list includes insurance giant Travelers, Under Armour, Purina and the Children’s Defense Fund.

Neil White, CEO of the BBDO office in Minneapolis, agreed.

“The merger won’t impact our operations in any big way but the eventual impact will be access to additional services,” said White, whose firm’s biggest client is Austin, Minn.-based Hormel with its Spam, Jennie-O and other food product lines.

Tom Moudry, CEO of Martin Williams, an agency with Marvin Windows and Doors and Raymond James as clients, said the merger means his agency now works “for the largest marketing network in the world.”

But, Moudry added, “I told my folks it will be business as usual and that means you grow your business by doing great work and keeping your clients happy.”

Nonetheless, the $22.7 billion combined Omnicom-Publicis structure creates a monolith bound to be riddled with client conflicts between existing agencies and an incredibly bureaucratic reporting structure.

Purdy said a merged Omnicom-Publicis entity will certainly have to set up firewalls to lessen potential conflicts among competing clients.

“The first thing they want to do is make sure they don’t lose any existing clients because of conflicts,” Purdy said.

Being part of an advertising holding company is nothing new in the Twin Cities.

Besides the Omnicom and Publicis presence in Minneapolis, New York-based Interpublic Group (IPG) is the parent of Carmichael Lynch and Campbell Mithun, and Colle+McVoy is under the umbrella of MDC.

Large, independent agencies are the exception, but a fiercely guarded one, to the holding company trend.

In the Twin Cities, that includes Periscope, with nearly 500 employees, Olson and Risdall Marketing Group.

“We control our own destiny,” said Greg Kurowski, Periscope’s CEO. “We can make investments to diversify our services and we can invest in our clients’ businesses. We don’t send our profits to London or New York or Toronto. They are distributed to the people here and reinvested in the business.”

 

David Phelps • 612-673-7269

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