Omnicom’s reshuffled leadership emerges as the ad industry’s new power players

Just two of IPG’s former leadership group have been lifted into the new C-suite roster leading Omnicom: Philippe Krakowsky, who moves from leading IPG to a co-president and co-COO role at Omnicom and Jacki Kelley, who will be chief client and business officer.

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If that’s surprising, remember that despite the diplomatic language, Omnicom’s deal for IPG was an acquisition — and not a merger of equals.

As such, the other names at the top table — like Troy Ruhanen, who ran TBWA and will now helm Omnicom’s entire creative advertising business, or CEO of Omni and Flywheel Duncan Painter — all come from within Omnicom. That’s par for the course with Omnicom’s ultimate ringmaster (and CEO) John Wren, say industry analysts.

“[Wren] is widely known for being a ‘trust’ person. In big businesses with 100,000 people… you have to have real trust in your key lieutenants,” said Jim Houghton, partner at Waypoint Partners.

Omnicom’s newly enlarged media business carries a number of unknowns, especially considering Wren’s statements that more announcements about the company’s structure and leadership are set to come. The group will include seven businesses including Omnicom’s existing media houses OMD, PHD and Hearts & Science, IPG’s shops Initiative, UM and Mediahub and its data broker Acxiom. It’s notable that Acxiom sits in the media unit, and not with operating platform Omni, which moved under Painter’s control a few months ago.

Michael Seidler, founder and CEO of M&A consultancy Madison Alley, suggested that grouping will shrink over time. “I would suspect that there’s going to be more consolidation,” he said.

For now, Omnicom Media will be led by Florian Adamski as CEO, alongside a 20-person team including COO Kate Osborne and Guy Marks, its chief client success officer. Some seats remain unfilled; the global brand presidents of Mediahub and Hearts & Science, for example, are as yet vacant. 

Just three IPG Mediabrands execs made the cut into the media group’s leadership — chief investment officer Daniel Fox and chief strategy officer Jonathan Rigby (who keep their titles) and Justin Wroe, previously the CEO of IPG Mediabrands in the U.S., who is now chief commercial officer.

Though they’ve made it out of the frying pan of the deal’s closure, those execs (and their new colleagues) may find themselves in a fresh fire. Omnicom must prove that it can actually deliver on the promised $750 million of “cost synergies” if it’s to maintain shareholder confidence in the short term.

“That is not going to be a quiet, relaxing Christmas and New Year for those guys,” said Houghton. “That February stock market announcement is going to have to be a blockbuster.”

They’ll have to navigate a number of challenges on the way.

Chief among them will be staff morale. Between the redundancies (the two companies employed 128,200 staff at the end of last year, while the combined entity will have 105,000 staffers worldwide) and the rendering-down of historic agencies like DDB and FCB, managers might find staffers less than enthusiastic about putting in the late nights and weekend shifts that make ad agencies billion-dollar companies. In turn, that’ll hamper efforts to retain clients over the next year.

“It’s a people business and ultimately, client satisfaction is driven by interactions with and the quality of talent that they’re dealing with on the agency side on a daily basis,” noted Gartner analyst Jay Wilson. CMOs might reason that their client teams aren’t going to produce their most creative endeavors if they’re stressed about a pre-Christmas Zoom call with HR.

“That’s going to drive more client attrition than anything else,” warned Wilson.

Omnicom’s leaders will want to get the most difficult parts of the process out of the way quickly. WPP and Dentsu, for example, took years to complete multiple restructuring processes that ended up clouding the narratives they wanted to project to clients.

Chaos can leave an opening for rivals, especially going into a year in which many analysts expect to see an uptick in media reviews. Omnicom’s holdco peers and consultancy rivals would surely be happy to welcome any CMOs that feel left out in the cold — they’ve been whispering in those clients’ ears for the last year to expect at least short-term disarray.

“You don’t want to create too much chaos too quickly,” said Seidler. “You really want to manage that transformation and ensure that clients feel well taken care of.”

Because of that, Wren and his executive coterie will want to avoid disturbing clients with too much change in too short a space of time. “To use a tired cliche, don’t change both engines on the plane at the same time,” said Wilson.