There is a sense of optimism and Day 1 energy when one sits down with Aditya Kanthy, president and managing director, Omnicom Advertising India (OA), as he reflects on the ‘new Omnicom’ following its $9-billion takeover of Interpublic in November.
For Kanthy, the acquisition that shook up the entire industry isn’t about costs or efficiency, but is fundamentally a growth play.
“There is so much attention being paid to kind of the efficiency side of the argument that not enough attention is being paid to the upsides, which is what this acquisition is primarily about,” Kanthy told Campaign. “As John [Wren] has said many times, this acquisition is about being prepared for the future. This is a future-facing, client-first conversation, which also involves restructuring because it makes sense to eliminate some duplication in areas of our business that are not directly client-facing. That helps us create some room for investment in the areas that really matter to our clients in their desire to win.”
As rival agencies trim their workforces and AI threatens to shrink agency mandates, Omnicom is betting on scale and capability depth to win. “If you don't have that scale, it is hard to be a serious answer to the problems or the opportunities that our clients grapple with,” Kanthy shared.
What Kanthy is hearing from clients is a consistent need for a fuller picture. They often feel they might be doing more than necessary, that their approach is more fragmented than it should be, and that nothing ties it all together. While everything doesn't need to happen in the same ecosystem, clients want to perceive cohesion in what is brought to the market, he said.
That’s part of the reason why he believes that smaller players will find it increasingly hard to compete. “There is a huge transformation happening in media technology and commerce and to be able to deliver effectively, we have to be able to compete there. If you [as an agency] don't have the full picture or all the capabilities, it's difficult to be able to do that.”
Omnicom is counting on the latest edition of its marketing operating system, Omni, to power that full picture. The newest iteration incorporates additional assets from IPG. That means the addition of McCann’s research arm Truth Central on top of Backslash, TBWA’s cultural intelligence unit. Acxiom, a database marketing company originally under IPG, now joins the Omni powerhouse with others such as Interact and Flywheel Commerce Cloud. With all of these individual pieces now sitting on one operating system, Omni AI will be able to hold all aspects of the journey together, be it defining strategy, planning media investments, measuring outcomes, or closing the loop at the last mile.
Kanthy believes the solution will be particularly effective in a market like India, where marketers have to dissect and cater to a variety of regional, category, and socioeconomic differences, among others. “Would you not welcome something that helps you tie it all together, whether it is a tool or a team that can hold that complexity together and bring some semblance of simplification to it?” he said.
From silos to capabilities
Seamless internal collaboration was also the driving force behind Omnicom’s new restructure. As chief executive officer John Wren explained to Campaign in his first interview post the acquisition, the objective was simple: deliver a connected solution in a very complex market for a client in the most cost-effective manner as humanly possible.
The new integrated strategy includes a move to nine “Connected Capabilities”: Omnicom Advertising, Omnicom Media, Omnicom Public Relations, Omnicom Production, Omni and Flywheel Commerce Network (for data), Diversified Agency Services, Omnicom Health, Omnicom Branding and Omnicom Precision Marketing.
Omnicom’s media agencies have come out of the restructure in a stronger position than the creative networks given Omnicom Media will operate six global agency brands, OMD, PHD, Hearts & Science, Initiative, UM and Mediahub, whereas Omnicom Advertising will only have three, BBDO, TBWA and McCann.
“The industry, two to three years from now, will just as much be about addressing AI audiences, agents, as they will be addressing human audiences. We are creating a new model that is much more connected, that is much more fluid than it ever was, that brings together the scale [of media, data and other capabilities] in an intelligent way,” Florian Adamski, CEO of Omnicom Media, had explained at the time.
Kanthy doesn’t see it as a creative versus media networks conversation but he does acknowledge that the structure mirrors the fragmentation of how marketing budgets are invested today. “10 years ago, you wouldn't have thought of a commerce capability as a standalone, or production capability or data capability. It was very much just an advertising and media conversation,” he explained. “Today, if you don't have a good answer on commerce, on data, on performance marketing, you're going to find it hard to see the full journey through.”
The India story
Kanthy believes that the Indian market has achieved a good balance in this regard. He points to the three primary connected capabilities represented here: advertising, media and production.
“If you look at Omnicom Advertising’s structure here – three large global networks (TBWA, BBDO and McCann) as well as all the local agencies (such as Lintas or Mudra) – that portfolio is as balanced or as wide as the Omnicom media portfolio, and that’s by design,” he said, sharing how they struck that balance between global priorities and local priorities. “We have been sensitive to the fact that in this market it makes sense to have a Mudra, Ulka, Lintas, Kinect, MRM, 22 feet, because it is the right solution for this market.”
In the new structure, TBWA's global disruption philosophy joins one of India's most loved brands – Lintas – to form TBWA\Lintas. Global agency BBDO will be supported in India through BBDO India, Mudra and Ulka. “Aside from that, we have got one of the strongest digital spines of any holding group between Kinect, 22 feet and MRM, allowing us to build one of the deepest pools of shared capabilities and cutting-edge new technology anywhere in the country,” Kanthy said.
Going from 60 to 90
The rollout of the new structure is already underway, with the TBWA and 22feet teams having moved to the Lintas office in BKC, Mumbai, last week. McCann, as Omnicom reimagines it, will be sitting together in the next 30 days, Kanthy estimates, and the reimagined BBDO post that. Locations across Omnicom’s key hubs (Delhi, Mumbai, Bengaluru) as well as Ahmedabad, Kochi, Calcutta and Chennai, have already been identified.
“I think everyone understands that in an acquisition of this scale, the coming together of two large companies, 60 to 90 days is a reasonable time frame. We're trying to move as quickly as we can to ensure that the teams that have to work together are together,” he shared.
Will clients also be rehoused? Kanthy said that globally, decisions are being taken to house clients within bespoke agencies, should they prefer that. For example, Bernbach, the bespoke multi-market team that was created for Volkswagen, was created in recognition of DDB founder Bill Bernbach’s relationship with the marquee car entity.
In the past, some agencies have had to forsake brands due to client conflicts. But Kanthy said most of their clients are “very much in this mix” going forward. “All of our clients have heard from the people that they trust. While there might be some rebadging in an acquisition like this, as long as they have the people that they know and trust, which is what has happened over the last 60 days, most of them have been welcoming of it [the merger].”
Asked how Omnicom Advertising is championing craftsmanship under this new structure, Kanthy said, “I think the investments that we've made in the leadership across the agencies should suggest how serious we are about nurturing craft and talent. One of the most exciting parts of this journey is the talent that we have in this holding group; amazing people who understand what good craft does. People who have built, on the back of good thinking, storytelling and great execution, brands that are winning across categories.”
Talent is a key focus for Omnicom over the next three to five years, in particular, how to they arm and equip young talent entering the industry to win more. “If we get that right, we might be able to design 15-, 20-, 30-year journeys.”
Source: Campaign India
