Publicis global revenue up despite facing a difficult year, but UK lags
Publicis Groupe’s organic revenue was up 1.5 per cent for 2015, beating analysts’ expectations, as a strong performance in the fourth quarter rounded off a challenging year.
However, the French advertising group warned to expect “modest” growth in 2016 as it continues to restructure and “transition into digital” following the acquisition of SapientNitro last year.
Chief executive Maurice Levy said the fourth quarter “turned out to be better than expected“ as organic growth jumped 2.8 per cent while its performance in North America “proved quite satisfactory” as organic growth reached +6.3 per cent.
Its biggest driver of revenue growth across the group came from digital activities, making up 52 per cent of revenue in 2015.
However, in the UK Publicis saw a 4.4 per cent decline in revenue which Levy pinned to the change of management at Publicis Worldwide UK and the reorganisation of Razorfish.
Levy, while optimistic as it nears completion of an overhaul of the way the orgnaisation operates, warned to expect only “modest growth” in the coming year.
The group announced its plan to “call time” on its siloed structure of communications groups and instead create four Solutions hubs. This has brought together Razorfish, DigitasLBi, SapientNitro and Sapient Consulting under one umbrella. This will mean that in the top 20 countries, its top 50 clients will each be accompanied by a chief client officer, reporting to a chief revenue officer.The new organisation will be rolled out in the first few months of 2016.
Levy said he had “great confidence” in the implementation of the new business model, adding: “It should enable us to meet the most demanding of client expectations and making us more competitive. The positive outcomes of recent collaborative undertakings testify to the fact that the organization we are putting in place is highly effective.”
During the year’s £20bn “mediapalooza” Publicis won a number of new clients, including Taco Bell, VF, Visa and Etihad, however made considerable losses in the US as Procter & Gamble and Coca Cola shifted their accounts.
Levy said for these reasons, 2016 will be a year of transition as it focuses on building foundations that will allow it "to fire on all cylinders in 2017.”