The big just got even bigger (but not better)

 

By Amar Chohan – Founder – Department of Creative Affairs.

As I write this, Omnicom has confirmed that it plans to buy IPG for around $14 billion. If completed, it would create the world’s largest advertising holding company. The industry headlines make it sound inevitable. Scale is everything. Except… is it?

The Orchestra trap

In the late 1980s, Britain went through a curious phase of orchestral mergers. Regional orchestras were combined into “super orchestras” in the name of efficiency and scale. The pitch was compelling: bigger orchestras could play more complex pieces, command larger audiences, and operate more efficiently. The reality proved rather different.

These merged entities became unwieldy, less nimble, and ironically, less distinctive. While they could indeed play louder, they often lost the specific character and expertise that made their constituent parts special. The most innovative performances, the real breakthroughs in classical music, increasingly came from smaller, specialised ensembles that knew exactly what they were about.

The marketing services industry looks remarkably similar today. WPP, Publicis, and now potentially a supersized Omnicom-IPG aren’t necessarily better at marketing – they’re just playing louder. Merge two agencies, spawn three new ones, acquire a specialist, rebrand a division. VMLY&R plus Wunderman Thompson equals… well, something bigger, certainly. But better? That’s a different question.

Client realities

Here’s a number that should keep CMOs awake at night: 89% of marketers believe their current agency model isn’t fit for purpose. Yet here we are, watching another round of consolidation that serves shareholders rather than clients. Yes, the networks offer impressive data capabilities and media buying scale – but for the vast majority of brands, these advantages remain theoretical. Networks are taking on clients of all sizes, hungry for growth. The problem is, their machines are built for complexity and scale that most clients simply don’t need. Sure, they can take on any client – just like a Formula 1 team could do school runs. But wouldn’t you rather have a ride that’s actually built for the job?

The auction house effect

A friend of mine works at an auction house in Mayfair that specialises in rare wines. The interesting part, she tells me, isn’t the astronomical prices paid for first-growth Bordeaux – it’s watching what happens to the excellent but less famous wines. Bottles that sommeliers fight over in private sales go unsold in auctions simply because they lack the right brand name.

Independent agencies face the same challenge. They might have deeper expertise, more senior talent involvement, and better cultural alignment with clients. But in a market built around the equivalent of wine ratings and brand names, they struggle to get into the right cellars. And with every mega-merger like Omnicom-IPG, the gap between perception and reality grows wider.

The IKEA illusion

The holding companies are playing what I call the IKEA game. They promise you can get everything you need in one place, and it’ll all work together perfectly. But anyone who’s furnished an entire house from IKEA knows the reality: some pieces are brilliant, others barely functional, and somehow you still need to shop elsewhere for the things that really matter.

When Omnicom bids $14 billion for IPG, they’re not solving a client problem – they’re solving a shareholder equation. It’s as if IKEA responded to falling kitchen cabinet sales by merging with a bathroom fixture company. The resulting entity might be bigger, but your drawers still won’t close properly.

Synergies = cost savings

When Omnicom bids $14 billion for IPG, there’s a human story that gets buried beneath the financial headlines. Consolidation inevitably means “synergies” – that coldly corporate euphemism for job losses. Talented people who will be affected by this merger.