ISBA has raised ‘significant concerns’ for its brand members following the merger of Publicis and Omnicom, while the World Federation of Advertisers has also voiced alarm for its own members.
Following a statement released by Bob Wootton, director of media & advertising at ISBA, which claimed to have a “long standing concern” about the concentration of competition as a result of the advertising groups buying power, the organisation’s director of public affairs, Ian Twinn, elaborated that advertisers so far had offered a mixed response.
Members of ISBA include major brands such as Nike, Bacardi, Audi UK, Coca-Cola GB, SAB Miller, Tesco and Diageo, to name a few.
“Between the two groups, about 70 per cent of the market is sewn up, which does not leave much choice for clients to choose their agencies from," continued Twinn. "There’s a lack of competition within the market,” he added, before highlighting the concern of sensitive information being leaked to rival companies which hire the same agency.
As for the possibility that the larger company could offer lower media buying rates, Twinn agreed that it was a possibility. “If they are buying so much media and they are also beginning to trade media independently of their clients, that’s stretching that relationship quite a bit. If the media trading and buying is where a lot of the profit is coming, there are dangers for advertisers there. We are aware that there are possibilities that advertisers will have to look carefully at the price of their media.”
He also revealed that the reaction from the organisation’s members had been “mixed”, with some saying that they could see no benefit and other not sure what to make of it, however they had no reason to counter Levy’s assertion that clients had been positive when informed.
Meanwhile, similar concerns have been raised by the World Federation of Advertisers managing director Stephan Loerke, who said while it recognised that the new company could provide “enhanced economies of scale” as well as “ a better understanding of the complex digital platforms” that have emerged within the advertising sector, it was “alert to the risks that excessive consolidation in the advertising market can also lead to a reduction in competition and transparency for our members.”
Yesterday, Paul Bainsfair, director general of the IPA, offered his reaction to the merger,alongside a number of independent CEOs from agencies and groups such as Karmarama, BJL, MSQ Partners, The Mission Marketing Group and SapientNitro.