For those who believe the holding company is dead, think again.
Last year’s flood of new business wins on both a global and U.S. scale, along with remarkable gains in organic growth across the board, made the selection of Ad Age’s first-ever Holding Company of the Year a Sophie’s choice. Buoyed by the massive global account win of the year, Coca-Cola Co., WPP Group posted a stunning 12.1% growth in organic revenue. Interpublic Group of Cos., the industry’s steadiest financial performer in recent years, once again turned in a solid performance of 11.9% organic growth for 2021.
But the ultimate selection goes to Publicis Groupe, which had a breakout year, officially validating its once-derided “Power of One” platform, its $4.4 billion acquisition of Epsilon and its AI-powered talent-sourcing model Marcel. Using these tools, the French holding company snatched up $5 billion in net new business by prevailing in some of the hottest reviews of last year—the $2.4 billion global media review for automaker Stellantis, as well as U.S. pitches for McDonald’s, the $600 million Walmart media account and the $1 billion Meta account. Along the way, Publicis swept up Eli Lilly, Planet Fitness, TikTok and L’Oreal China, all contributing to a 10% rise in organic growth last year.
'It's been a journey'
“It has been a journey through the [past five] years to get us to this year,” said Carla Serrano, chief strategy officer for Publicis Groupe. “The bets we made in the past toward how we were looking forward to the future became sort of normalized in the industry—the Power of One model and integrated pitches. People thought it was crazy when we started [our transformation] back in 2015, and our bet on Marcel—well, I don’t have to remind you of how controversial that was.”
Marcel, in fact, is now playing a more humanitarian role beyond matching teams with clients. After the Ukraine war broke out, Publicis employees began using it as a facilitator to connect people within its network. Employees have used it to offer assistance to Ukrainians working at Publicis agencies and to offer their homes to refugees leaving the country. Arthur Sadoun, Publicis Groupe Chairman-CEO, has also guaranteed salaries to workers in its Ukraine agencies through the end of the year. The company—which cut salaries at the start of the pandemic—has also awarded year-end bonuses to all employees who have been with Publicis more than 24 months, and is giving an additional week’s salary to 35,000 employees without bonus plans.
“A year ago, many of us took a salary cut, and now we are giving them back the money,” said Sadoun, as a response to employees’ high level of commitment before and throughout the pandemic. “We will lose several basis points of margin, but who cares?”
Those toils resulted in some big wins for the French holding company last year, including U.S. media accounts for the likes of Inspire Brands, McDonald’s, Walmart and others. But Nigel Vaz, CEO of Publicis Sapient, said the company starts out with a data-informed business transformation solution for clients. “Media might be the gateway,” said Serrano, “but we always pitch the Power of One.”
Case in point: J.M. Smucker Co., touted as a $580 million account when Publicis scored its media, creative and data business in 2018. “What we asked Publicis to do was to help us develop a bespoke model” that grouped top talent from both the client and the holding company,” said CEO Mark Smucker. “We wanted access to the best talent across their entire network.” The result was Publicis Smucker One, or PSOne, which he describes as “almost like an in-house agency though they are not in-house. We work as one team.”
“This marketing model has really been instrumental in helping us to transform,” said Smucker, who credits the combination with giving the company license to embrace edgier creative approaches such as its “That Jif’ing Good” campaign. “A year or two ago, we were growing share for only 40% of our brands. Now we are over two-thirds,” he said.