At Omnicom, Accuen Declines While Annalect Grows

Omnicom’s trading desk Accuen shrank $9 million, or 0.2% year over year, in the US this quarter because clients continue to favor fully disclosed programmatic buys, the company said Tuesday.

In other markets, where nondisclosed buys have generally been more accepted by marketers, Accuen was almost flat, growing by just $2 million in the quarter.

“We haven’t lost clients, but we’ve changed the way we do business with them to a full disclosed method,” said Omnicom CEO John Wren on the company’s Q3 earnings call Tuesday.

But in exposing its programmatic margins to sustain relationships with US clients, Omnicom is also putting short-term pressure on those margins.

To accommodate margin disclosure, Omnicom, whose global revenue decreased 1.9% year over year to $3.7 billion, is taking programmatic specialists out of the Accuen silo and embedding them into its agencies.

“We’ve pushed this into the operating brands within the media company,” Wren said.

Programmatic isn’t the only service offering which Omnicom continues to change.

In addition to divesting $500 million of nonessential businesses, including legacy print shop Novus, Omnicom is creating bespoke teams across disciplines in order to break down internal silos.

Wren added that CRM in particular will become a hub for business transformation services at Omnicom, led by former DigitasLBi CEO Luke Taylor, who joined the company in June. But Wren didn’t go into much detail about what services will be available to clients from the new division.

“Many of the world’s largest companies and best-known brands are experiencing fundamental changes to business,” Wren said.  “There is a significant opportunity for Omnicom to transform the way they approach customers. Marketing needs to be tied into their larger strategy, including sales.”

Omnicom is also continuing to build out the Annalect data platform by signing more deals with first-party data suppliers.

“There is a tremendous opportunity for to Omnicom Precision Marketing Group to leverage Annalect… and work in partnership with creative and media agencies to help clients put individual IDs at the center of their marketing,” Wren said. “Capabilities like these will let Omnicom clients form direct relationships with consumers when it comes to today’s digital and always-on world.”

Despite these changes, clients will continue to be disrupted by technology and put cost pressure on their marketing spend for the foreseeable future.

“That is something we’ve been dealing with at a pace for the last several years and I don’t see that changing any time soon,” Wren said.

This post was syndicated from Ad Exchanger.