Omnicom will lay off around 4,000 employees and close numerous well-known advertising agency brands following its $13 billion acquisition of rival Interpublic Group, according to the Financial Times, citing an interview with business executives.
The advertising industry is facing an existential crisis as artificial intelligence reshapes creative production and tech behemoths like Meta make it easier for companies to produce ads at volume and speed.
Omnicom’s high-profile acquisition of Interpublic Group is a move to recover traction in this altering industry, where it faces tough competition from French ad behemoth Publicis and UK’s WPP. The firm did not immediately return a Reuters request for comment.
Creative agency DDB, founded in 1949, and innovative marketing agency MullenLowe will be integrated into Omnicom’s TBWA, according to the report. FCB, one of the largest global ad agency networks owned by IPG with roots dating back to 1873, will be absorbed into Omnicom’s BBDO, the report said.
Omnicom boss John Wren said more than 4,000 jobs would be cut as part of the IPG integration, mainly in administrative roles but some leadership positions too, the Financial Times reported. Wren, who will remain as chair and chief executive of the combined entity, said the financial benefits would surpass the $750 million in annual cost savings initially projected to investors, according to the report.
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