Magazine article Marketing

Omnicon Group to Swallow AMV

Magazine article Marketing

Omnicon Group to Swallow AMV

Article excerpt

Omnicom's announcement to the Stock Exchange last week that it plans to take control of Abbott Mead Vickers BBDO has implications beyond its directors becoming multi-millionaires. AMV is arguably the country's most successful advertising agency and counts the likes of BT, Sainsbury's and Volvo among its blue chip client list.

If the [pounds]350m bid is accepted - which observers expect before Christmas - Omnicom will control three of the UK's top ten advertising agencies with combined billings of [pounds]781m. This means that the group's agencies, TBWA GGT Simons Palmer, BMP DDB, plus AMV, would control 19% of ad campaigns produced by the top 30 agencies.

Omnicom would therefore overtake WPP, which bills [pounds]507.4m through J Walter Thompson and Ogilvy & Mather, as the largest ad agency group in the UK.

Omnicom, the giant US communications group, has owned 27.7% of AMV via its BBDO network since 1991. Therefore, beyond the agency changing its name to BBDO Abbott Mead Vickers, many feel that the deal is merely formalising the relationship.

"The companies have had years of working together, with a lot of European BBDO work being handled by the London agency - Compaq being a recent example. There won't be a shift of power as a result of the deal. It just means that after years of going to bed together, they're now getting married," says industry analyst Lorna Tilbian at Panmure Gordon.

But some clients disagree. Andrew Marsden, marketing director of Britvic, whose Pepsi brand is handled by AMV, says maintaining creativity and the same level of service is always an issue after a takeover.

"What you're buying from an agency is relationships and understanding built up over time. This inevitably changes when new management comes in. There's nothing more frustrating for clients than receiving a letter from an agency post-buyout, saying 'don't worry, nothing's going to change,' - that's absolute rubbish," he claims.

There is also the question of corporate culture. AMV's three founding partners, David Abbott. …

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