Publicis is powering ahead, WPP is steadying the ship and Omnicom is finding its feet after a mega-merger. The Big Three loom large – but the industry around them is in serious flux. Green Square’s Barry Dudley examines what Q3 reveals about adland’s changing balance of power.
When I started out in professional services there were ‘The Big 10’ accountancy firms, which at the time felt quite a daunting gang. But I found my way into that gang with Arthur Andersen. The Enron scandal came along, and the firm was taken over by various of its peers around the world – in the UK we went to Deloitte. And roll forwards to now, there’s just ‘The Big Four’.
Through that time my expertise was always marketing services, media and production. In this world, we are now down to ‘The Big Three’ – Omnicom, Publicis and WPP. So how are they faring given their Q3 results and, more importantly, what does having a Big Three mean for the sector more generally?
The Q3 results
Starting with organic revenue, Publicis was up 6.9% in the quarter, WPP was up slightly at 0.5%, whilst Omnicom was up 7.2% based on its ‘core operations’. Not quite apples and apples, as Omnicom’s numbers are on a different basis.
Looking at organic net revenue (as opposed to total revenue), Publicis was up 5.0% and WPP was down 3.9%. Omnicom doesn’t report at this level.
So, the initial assessment is that Publicis continues to move along impressively, WPP is clawing its way forwards and Omnicom is still finessing what its core operations are since its mammoth coming together with IPG but seems to be trading well.
But what did the leaders of each business have to say? Publicis CEO Arthur Sadoun said: “This was our 25th quarter of outperformance, and thanks to our unique ability to connect data, technology and talent through the Power of One, we are confident in confirming our full-year guidance for 2026 and in outperforming the market for the eighth consecutive year in 2027”. Very firmly on the front foot and riding a wave.
WPP CEO Cindy Rose said: “We are on track to deliver phase one of Elevate28: stabilizing our business performance and laying the foundations for a simpler, more unified WPP. Our integrated client proposition and modern data solutions are gaining traction with both new and existing clients.” The key word here is ‘stabilizing’. So Rose is, rightly, pleased to be settling the ship.
And Omnicom CEO John Wren said: “As we approach the one-year anniversary of the Interpublic acquisition, we continue to deliver the expected benefits of the combination. We’ve strengthened our competitive position and are on track to deliver $900 million in cost-reduction synergies in 2026 resulting in stronger organic revenue growth, operating margins, and earnings per share.” There is still a little way to go with the integration, but progress has clearly been made with the numbers.
There were two things that stood out for me in the business lines: Media remains the engine room for all of them – Publicis’ Connected Media grew by high single digits, WPP Media was up 0.3% and Omnicom’s Integrated Media was up by over 10%. Conversely, the performance of creative/advertising was not so pretty: Advertising fell mid-single digits for Omnicom, WPP Creative was down 5.1% and it was low single digits growth for Intelligent Creativity at Publicis. I’ll come back to the creative theme later. Again, these comparisons aren’t quite apples and apples given that Omnicom reports differently, but the directions are clear.
Regionally there were some consistencies across the three: US performed the best, the UK was down and unsurprisingly, so was the Middle East.
And what of the stock markets? I looked at the share price movement from the day before announcement and compared it with the day after announcement, so a three-day spread. All saw price increases: WPP up over 5%, Omnicom over 2% and Publicis up over 1%. My reading is that the markets expect Publicis to do well so there was no major jump in its favor, Omnicom was rewarded for delivering cost savings and WPP has benefited from some strong leadership from Rose in starting to turn the WPP tanker towards a new path.
The big themes beyond the results
- The CEO, not the CMO, is the buyer
Sadoun says AI transformation “has to start from the top” and Publicis is “increasingly seeing CEOs involved in what we do”. Rumor has it that PepsiCo’s move to Publicis was led by its CEO. Cup half full view of this for the CMOs out there – they are still highly important and relevant, arguably more than ever, but the CEOs are right there next to them.
- The pitch is dying, or is it?
This is probably an extension of the previous point. In the Publicis webcast Sadoun said clients are increasingly appointing agencies without a pitch and that Publicis won “the two biggest accounts of the year without a pitch” and “three material AI-led transformation assignments this year outside of traditional pitch processes”. Speaking to The Drum, he presents it as the new normal: “Those same clients increasingly consider it is way more efficient to spend their time… digging deeper and actually kicking the tires of the partner they are interested in, rather than organizing this kind of big beauty contest for months.”
Two weeks later, in the WPP results webcast, Rose stepped into this when responding to an analyst’s question, referencing “this pitch-less, CEO handshake thing that I keep getting asked about”. Rose continued with: “What can I say here? Look, nobody loves pitching, right? You’re not going to find anybody that says: ‘I love pitching.’ The cost and burden of the process seems to be, you know, increasing. But I think what’s really important to me is that my clients fully understand the implications of the decisions they’re making. These are really high-stakes decisions with material business consequences, and they deserve careful consideration. I don’t think we do ourselves any favor as an industry of professionals by encouraging clients to bypass proper due diligence, and I think I’ll leave it at that.”
The pitching debate continues to rumble on!
- Aesop’s fable
Aesop told of a lion and a bear who fought over a fawn until both lay exhausted, only for a passing fox to carry it off. The Big Three aren’t exactly brawling, but between integrating, restructuring and arguing over whether pitches still matter, they are certainly distracted with each other right now. And there are plenty of foxes about.
Take Stagwell for example. Its CEO, Mark Penn, isn’t trying to build a fourth holding company, he’s arguably trying to stop being an agency group altogether. But I do believe Stagwell (along with many others) is becoming a very credible alternative. Stagwell’s organic net revenue was up 7.4% in Q3, adjusted EBITDA up 25%, new business is strong. And tellingly Penn said in the earnings webcast: “Well, I think for us, we are continuing to win really high levels of creative accounts, but there is still a lot of shrinkage, and movement, and CMOs being fired. I do think there is a lot of turmoil in general. It is a great door for us.”
There’s that word ‘creative’. Just as the Big Three seem to be suffering in this area, the foxes are out and about picking up significant creative work. I will be following up with more thoughts on this; the Big Three will always have a Media and a Data capability that only they can provide to certain clients, but creative is a whole different ball game.
- Creator economy and sport
Publicis acquired 160over90 which it called ‘the premier global sports and culture agency’ and Point d’Orgue, a Paris based influencer and creator agency. WPP announced Devon’s Point, a 34,000 square foot production studio with dedicated spaces for creators: live streaming studios, quick shoot-and-edit facilities and areas for brands and creators to collaborate. And Omnicom’s Wren commented in their earnings webcast: “And in sports marketing, where we manage $9.9bn in sponsorships and talent and oversee one-third of global sports media investments, we secured a major integrated assignment for the 2028 Olympic Games in Los Angeles, spanning sponsorships, creative, and communications.”
New battlegrounds that the lions and bears will be fighting over…
