R3 Worldwide Data On Global Media Reviews Shows Which Agencies Are Most Vulnerable

Correction: The original version of the story included incorrect data indicating Publicis Groupe had the most to lose in the “pitchapalooza” wave of agency reviews currently underway. In fact, Omnicom Group and Dentsu are slightly more exposed. The below story makes that clear and includes a corrected chart reflecting actual impact on revenues for the various holding companies.

Omnicom Group and Dentsu face the most risk by a thin margin in the recent wave of agency reviews, according to data from Jefferies Equity published by global consultancy R3 Worldwide.

Details about the relative downside for holding companies caught up in a rash of more than 25 media agency RFPs appeared in R3’s Q2 2015 report, released over the weekend. The consultancy focuses on agency compensation and relationships.

Corrected chart


From a purely financial standpoint, WPP has $7 billion worth of billings at risk (Unilever, Volkswagen, Sony, Daimler, Visa and SC Johnson), the most of any other holding company.

But even if WPP were to lose all its at-risk accounts, the loss would only have a 1.2% impact on the holding company’s revenue, whereas Omnicom and Dentsu both stand to lose about $400 million more than that.

Right behind them is Publicis, which is defending billings totaling 1.5% of revenue.

But cheer up, guys. “It’s difficult to assume they will only lose and not win,” said Greg Paull, principal and co-founder of R3. He pointed out that although Publicis lost Coca-Cola, it won Visa. “The key one [for Publicis] will be P&G, which has been a longtime Starcom iconic client.”

Meanwhile, if Havas were to lose its account with Sears, valued at $200 million, it would have a relatively low impact on revenues, at 0.2%.

The litany of media reviews, totaling $22.7 billion, has been a major industry talking point this year. Certainly this trend has to do with the fact that numerous two- or three-year contracts are coming to an end, Paull said.

But the real drive, he said, is digital.

“Marketers want to ensure they have the most effective and efficient results for digital display, search, mobile, social, programmatic and analytics,” Paull said. “All of these have been front and center of each review.”

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