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Omnicom Group Inc.

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2019 Vault Rankings

At a Glance

Uppers

A worldwide company with over 5,000 clients in over 100 countries

Many opportunities for women and minorities

Downers

Lack of unified vision between various agencies

Lack of communication and collaboration between its different units

The Bottom Line

Omnicom is a kind of omnibus--a large global company with many separate divisions that are still working on communicating and collaborating with each other.

About Omnicom Group Inc.

Omnicom Group creates advertising that is omnipresent. The company is a leading global marketing and corporate communications company that provides services to over 5,000 clients across 100-plus countries. Omnicom's branded networks and numerous specialty firms provide advertising, strategic media planning and buying, digital and interactive marketing, direct and promotional marketing, public relations and other specialty communications services. The US accounts for about 55% of sales.

Operations

Omnicom is active in five primary disciplines: Advertising, CRM Consumer Experience, CRM Execution & Support, Public Relations, and Healthcare.

Advertising accounts for over 55% of Omnicom's total revenue. It includes creative services as well as strategic planning and data analytics.

CRM Customer Experience and CRM Execution & Support generates over 15% and almost 10%, respectively. CRM Consumer Experience includes Omnicom Precision Marketing Group and digital/direct marketing agencies as well as branding, shopper marketing, and experiential marketing agencies. CRM Execution & Support carries out field marketing, sales support, merchandising, and point of sale, as well as other specialized marketing and custom communications services.

Public Relations services, including corporate communications and crisis management, generate about 10% of sales, as well as Healthcare-focused marketing and communications provides about 10%.

Geographic Reach

Omnicom has principal corporate offices in New York, Connecticut, and Florida, while it has international offices in London, Shanghai, and Singapore. The group's network of agencies serves some 5,000 clients in more than 100 countries.

Around 60% of the company's revenue comes from the Americas, while EMEA (Europe, Middle East, and Africa) contributes almost 30%. The remaining 10% or so comes from the Asia-Pacific region.

Sales and Marketing

As a leading global advertising, marketing, and corporate communications company, Omnicom has a large and diverse client base. Often several Omnicom agencies will serve the same client concurrently. None of its clients account for more than 5% of revenue, while its top 100 clients account for a little more than 50% of revenue and are served on average by more than 60 Omnicom agencies.

By industry, food and beverage companies along with pharmaceutical and healthcare firms account for the largest share of customers, with each contributing nearly 15% of the company's total revenue. Omnicom serves other notable industries, including consumer products, technology, financial services, and the auto industry, each accounting for nearly 10% of sales.

Financial Performance

Omnicom's revenue fluctuated in the last five years. It has an overall decline of 1%.

In 2019, revenue decreased $336.5 million, or 2.2%, to $15 billion from $15.3 billion in 2018.

Net income increased to $12.7 million, or 1.0%, to $1.34 billion from $1.33 billion in 2018 due to the decrease in salary and service costs, and net interest expense.

Cash at the end of 2019 was $4.3 billion. Cash from operations was $1.9 billion, while investing activities used $31 million. Financing activities used $1.2 billion.

Strategy

Omnicom continues to use its virtual client networks to grow business relationships with its largest clients by serving them across its networks, disciplines and geographies.

Its acquisition strategy is focused on acquiring the expertise of an assembled workforce in order to continue to build upon the core capabilities of the company's various strategic business platforms and agency brands through the expansion of their geographic reach or their service capabilities to better serve clients.

Mergers and Acquisitions

In late 2019, Omnicom Precision Marketing Group, the digital and customer relationship management (CRM) specialist group within Omnicom Group Inc. agreed to acquire a majority stake in Smart Digital GmbH. "Partnering with Smart Digital is not only a strategic move for Omnicom, as we grow and leverage proprietary tools, like Omni, to strengthen our AI and personalization capabilities, but, moreover, it's important for our clients – for whom we'll be better able to deliver powerful end-to-end customer experience solutions," said Luke Taylor, CEO of OPMG.

Company Background

Omnicom Group was created in 1986 to combine three leading ad agencies — BBDO Worldwide, Doyle Dane Bernbach Group (DDB), and Needham Harper Worldwide — into a single group capable of competing in the worldwide market.

BBDO Worldwide, founded in New York in 1928 as Batten, Barton, Durstine & Osborn, had a huge PepsiCo account and developed the Pepsi Generation campaign.

Doyle Dane Bernbach Group (DDB), which had created the fahrvergnügen ads for Volkswagen, had strong ties in Europe.

Needham Harper Worldwide, which had served up the "You Deserve a Break Today" commercials for McDonald's, had connections in Asia.

Omnicom was established as holding company of independent operating units working together to gain scale.

Omnicom Group Inc.

437 Madison Ave
New York, NY 10022-7001
Phone: 1 (212) 415-3600

Firm Stats

Employer Type: Publicly Owned
Stock Symbol: OMC
Stock Exchange: , NYSE
Chairman: Bruce Crawford
Vice Chairman; Chairman, Asia Pacific: Serge Dumont
President and CEO: John D. Wren
Employees (This Location): 62
Employees (All Locations): 70,000

Major Office Locations

New York, NY

Other Locations

Rogers, AR
Irvine, CA
Long Beach, CA
Los Angeles, CA
Pasadena, CA
Roseville, CA
Sacramento, CA
San Francisco, CA
Venice, CA
Walnut Creek, CA
Westlake Village, CA
Lakewood, CO
Darien, CT
Stamford, CT
Wilton, CT
Washington, DC
Coral Gables, FL
Fort Lauderdale, FL
Miami, FL
Miami Beach, FL
Tampa, FL
Atlanta, GA
Kennesaw, GA
Chicago, IL
Mount Prospect, IL
Oak Brook, IL
Indianapolis, IN
Boston, MA
Rockville, MD
Detroit, MI
Troy, MI
Minneapolis, MN
Kansas City, MO
Saint Louis, MO
Helena, MT
Charlotte, NC
Greensboro, NC
Raleigh, NC
Edison, NJ
Jersey City, NJ
Trenton, NJ
Westfield, NJ
Albany, NY
Collegeville, NY
Garden City, NY
New York, NY
Syracuse, NY
Cincinnati, OH
Columbus, OH
Harrisburg, PA
Pittsburgh, PA
Nashville, TN
Austin, TX
Dallas, TX
Houston, TX
Irving, TX
Midvale, UT
Seattle, WA
Kenosha, WI
New Berlin, WI
Sturtevant, WI
Santiago, Chile
Bengaluru, India
Chennai, India
Gurgaon, India
Mumbai, India
New Delhi, India
Pune, India
Milano, Italy
Roma, Italy
Fukuoka, Japan
Hiroshima, Japan
Kitakyushu, Japan
Kyoto, Japan
Minato-Ku, Japan
Nagoya, Japan
Naha, Japan
Osaka, Japan
Sapporo, Japan
Shimonoseki, Japan
Yokohama, Japan
Brasilia, Brazil
Rio De Janeiro, Brazil
Calgary, Canada
Edmonton, Canada
Halifax, Canada
Montréal, Canada
Montreal, Canada
Ottawa, Canada
Toronto, Canada
Vancouver, Canada
Westmount, Canada
Winnipeg, Canada
Düsseldorf, Germany
Santo Domingo Oeste, Dominican Republic