Hasta La Creative!

This won’t go over well. In a story we missed yesterday, Omnicom media operations CEO Daryl Simm told The Wall Street Journal that everyone needs to spend less money on TV spots and more money on…digital video.

This isn’t exactly a surprise. Simm argues that it’s just a way of re-framing the same old relationships:

“Online video ad spending is growing at a considerably faster pace than overall media budgets have been growing…So TV money is traveling to all of those other alternatives.”

And how large is the shift?

“We are counseling our clients to move between 10% to 25% of TV dollar to online video, depending on the target audience…A significant portion of the dollars are actually going back to TV owners for their online properties.”

But:

“The amount of quality online video is still an issue…What does it mean for a brand to be associated with a particular piece of content? And what does that mean for the consideration of that brand by consumers?”

Despite all this, Simm says that “The desire for more measurement and accountability is getting higher and higher.”

His message to traditional ad folk: expect more of the things you don’t like.

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In what appears to be a clandestine RFI process, Starbucks has announced a changing of the guard in its media agency relationship.
Following only the first phase in review, the java giant has decided to cut ties with Omnicom PHD and hire Publicis Groupe’s Spark. Prior to the RFI and decision after the initial review, PHD was Starbucks’ media agency for the past six years.
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This morning in news that has nothing to do with the Omnicom/Publicis collapse, WPP/GroupM media agency Maxus poached a top executive from Omnicom’s PHD.

Steve Williams, who spent two years as president at PHD, will be Maxus’ new North American CEO starting June 1, replacing the retiring Louis Jones; Williams will report to global CEO Vikram Sakhuja as well as GroupM’s North American chief Kelly Clark.

In the new role, Williams will work with the New York, L.A., Chicago, Minneapolis and Toronto offices of what the press release and RECMA call “the fastest growing global media agency for the past four years.”

Before joining PHD, Williams served as CEO of the UK’s OMD Group.

No word on how much pleasure Martin Sorrell took in making this announcement.

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If you’re a gambling man, you might want to bet against the pending mega-merger and the double-headed hydra it would create.

Earlier this week, WPP‘s Martin Sorrell gleefully told Reuters–via a little birdie–that chances of the deal going through were less than even. Yesterday, The Wall Street Journal reported that analysts at Albert Fried had lowered the official odds to 40% (the previous number was 66%) while downgrading  the theoretical stock price from $70 to $56.

The fact that Publicis recently lost Microsoft, Samsung and Miller Lite didn’t help; the defections have compounded risks created by a clashing of egos over the contested CFO role.

All involved parties still say the deal will go through, primarily because “there’s a $500 million break-up fee at stake”, so we expect to see a few more upbeat press releases in the days ahead.

As principals at both companies sweat a bit more heavily this week than last, WPP may have already begun planning its victory lap.

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Maurice Lévy is back this year for the new Publicis Groupe New Year’s greeting. After toying with YouTube’s functionality last year,  the holding company, with the aid of their DigitasLBi France unit, has once again found a new way to make their greeting interactive.

This year, Publicis built their message around the theme of #TheMoretheMerrier in honor of their expected merger with Omnicom. To accomplish this, they’ve made it so “The more people that join in during the video, the merrier it will become.” So, what does that mean exactly? Well, if you watch the video alone, nothing special happens. But if you watch with a friend, Maurice Lévy will deliver his speech in a confetti storm. Adding more people to the mix will result in “gospel singers, cheerleaders, Chinese dragons and a few other surprises.” It’s a pretty cool concept, managing to be interactive in an intriguing new way.

To accomplish this, Publicis’ tech team developed “a fancy facial detection algorithm that allows a webcam to count how many people are actually watching the video together.” The facial recognition software was conceived by “a 21 year old Russian math genius” working for DigitasLBi France. The software is the “first of its kind to detect up to ten faces simultaneously” while the video plays. “The More the Merrier” is the first video to count the number of viewers, rather than views, on YouTube. That’s a lot of technological firsts for a New Year’s greeting. By the way, in case you were wondering, it takes 1,487 balloons to cover Maurice Lévy.

Credits after the jump. continued…

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For the last few weeks, all we ever think about during our waking hours is the Omnicom/Publicis merger and how lucky we are to be living in a time where something this momentous happens. Truly, we wake up now with a new sense of purpose and self-worth knowing that two giant holding companies merged to make the biggest holding company.

However, not everyone shares our enthusiasm, chief among them Atlanta-based indie shop Ames Scullin O’Haire. They made the above video to convince us that the merger wasn’t a good thing and doesn’t really benefit anyone beyond the rich people in charge of the agency networks who are now richer. “Bigger isn’t always better” says ASO, who is small and would totally say something like that to besmirch the good name of Publicis-Omnicom Groupe.

Will all of Atlanta’s biggest businesses pull their money from large agencies and invest in ASO after seeing this video? To be honest, yes. Definitely.

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As one might imagine, the announcement (and Vine video) of the biggest merger in advertising history is causing quite a reaction from those in the industry. Above, Keith Hunt, managing partner of M&A consulting firm Results International, hypothesizes about the implications the newly formed Publicis Omnicom Group will have.

As Hunt notes, the merger means the company will be able to buy media very cheaply, leapfrogging WPP in the process. But, Hunt wonders, how far can you push down prices? At one point do vendors draw the line?

Also, Hunt says, there’s the issue of who’s in charge. Co-chief execs, John Wren (Omnicom) and Maurice Levy (Publicis)  are elder statesmen. Levy, the older of the two at 71, is now on the hot seat in terms of naming a successor, that is, if the balance of power between Publicis and Omnicom remains a priority. As WPP’s Martin Sorrell said in an interview today, “It’s a nil-premium merger — effectively a takeover of Publicis by Omnicom [without exchange of money].”

Finally, says Hunt, there’s the matter of positioning. It benefits the new company to frame the merger as one that hinges around new technologies and emerging markets, allowing Publicis Omnicom Group to compete against tech companies outside advertising agencies like Adobe. “Exciting times,” he adds before staring into the camera wistfully. It’s only the beginning.

Check out Wren and Levy bonding after the jump.

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