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Publicis Omnicom collapse makes WPP the undisputed heavyweight champion of the world

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By Matthew Charlton, CEO

May 9, 2014 | 4 min read

I am sure Sir Martin must be having champagne for breakfast today. His two biggest rivals have proven that once again he is the smartest operator in the game of big stakes advertising bingo that has engulfed the industry. I don't always love the result of this game, but Sir Martin has created it and knows it best.

Sir Martin Sorrell

If you examine just a few of the facts of the rise of WPP you can see it is a smart long-term strategy that is underpinned by clever, well-priced acquisitions and great hires. And it has taken a great deal of time.

It started with the incredible robbing of JWT from under the nose of the Americans for a superb price. It was then discovered that the company had a property asset worth $100m, which was promptly sold and reduced the debt immediately. Grey was a very unexciting business that has now been turned, by very high-quality leaders, into a very strong business in the globally important cities of New York and London. Ogilvy, as is well known, has gone from strength to strength, building from its huge success first in Asia and massive early investment in digital to spread that culture of integration across the globe. The Group M play of merging all media companies into a single buying entity was ahead of the game and very clever. And all of the people that have helped Sir Martin do this remain in the business and from what I understand well incentivised to stay.

The other thing that is often now forgotten is that Sir Martin is part of the amazing Saatchi story and has learned the industry not just through the lens of an accountant, but through the lens of some of the smartest creative people the industry has served up.

This seems in stark contrast to what appeared to look like a rapidly conceived and clearly unexecutable plan by Onmicom and Publicis to smash their businesses together to primarily get a bigger media pot to buy from and slash a few costs while they were are at it.

It was also a deal that seemed to have been very much positioned as the personal desire of the two CEOs, rather than the upper management of the companies being aligned. I can't help but wonder if this thinking again is a symbol of the over-domination of financial experts in publicly quoted companies vs people that have actually built agencies and truly understand the irrationality of the business. What made sense on paper makes very little sense in reality.

Anyone who has ever worked in both the US and France, as I have, will tell you that the chances of these two cultures working together are close to zero. I have a wonderful French wife and after 15 years of marriage still struggle to completely understand the complexity that French culture exudes. I think perhaps if there was 15 years to make the deal work the marriage of Omnicom and Publicis would work.

So what happens now? I expect very little in terms of tangible change to either business. But I for one hope that this represent's the end to commoditisation of agencies and that the energy of such powerful and wealthy businesses with incredible individual brands in their hands, TBWA, DDB, BBH, AMV BBDO, Leo Burnett, to name a few, will get the focus, concentration and investment to be developed primarily as the individual gems that they are.

Just for a moment, look into the names of some of the people whose initials are shortened above and you will find not just great people, but the names of geniuses. Surely the job of a holding company is to discover the ways of maximising this value, not sub-merging that value.

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