In a recent interview with leading Australian trade publication MI3, Omnicom Media Group CEO Florian Adamski shared his perspective on implications and opportunities as the pace of transformation continues to accelerate across the marketing landscape—and how it’s impacting clients and agencies alike. Highlights from the discussion are excerpted below:
AI Is Upending Everything
“Our industry is probably at the very, very forefront, the coalface of how AI is changing the way we work, the way we deliver, the way we serve clients going forward. Having people put the pieces together to truly unlock the opportunity AI clearly delivers – that takes a very, very specific setup and only a few players in the marketplace are scaled, capitalized in a way {as is Omnicom} to deliver against that. That is the moment we’re seeing right now. Put on top of that the acquisition of IPG: We will have a broader, even deeper talent pool. We will have more data-driven capabilities, we will integrate into one operating platform that allows us to operate within one workflow, within one process, and to have a single point of truth for clients to then start co-creating with us.”
In-Housing Reverses
“Clients are overwhelmed by the abundance of options and choices. They’re looking for somebody to put back together a fragmented world, and it has come in terms of technology choices, third-party tech providers, talent, and the sheer number of specialisms that clients struggle increasingly to control, integrate, and really orchestrate. We have numerous clients across Omnicom Media Group right now that, over the past 12-18 months, dialed back the scope of what previously sat in-house, into Omnicom Media Group with hands-on keyboards. That is happening in the United States, it’s happening in Europe, and there are also examples in parts of Asia Pacific, including Australia. On the enterprise side, they’re looking at their resources and saying, ‘I want a fully integrated stack. How can you pull this all together? How can you actually reduce our headcount?’ This is what’s coming through.”
How Agencies Are Paid Must Change
“Hourly fees and the downward pressure procurement departments put on them in contract renewals are anachronistic to an AI era landing faster than most can keep up with. It will be among the biggest growth restraints on client businesses that don’t break the habit. It cannot be the future model because agencies are not being incentivized currently for driving automation or efficiencies. Instead, they’re being paid by the human hour. Procurement is incentivized for one thing, which is how can you procure the same service, the same material, the same goods, at a lower price? Clients at the very top of the organization will have a different set of ambitions and targets [to procurement] because they want to unlock as quickly as possible the opportunity and growth AI brings. If AI is viewed as a force multiplier for growth, it allows for the commercial model to change radically to more performance and outcome-based measures.”
From Service Models to Solution Models
“The brief is for innovative new commercial models that truly incentivize us for that {better} business outcome of clients. Because if we get to that level, all of a sudden we will have a seat at the table with the CFO, the CEO.”