Omnicom: The World's Largest Advertising Conglomerate

            
 
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Case Details:

Case Code : BSTR089
Case Length : 21 Pages
Period : 2000 - 2003
Organization : Omnicom Group.
Pub Date : 2004
Teaching Note :Not Available
Countries : USA
Industry : Advertising & Communication

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Introduction Contd...

Omnicom sources attributed the increase in non-advertising revenue growth to its diversification strategies, which reduced its exposure to any single industry. Some industry observers felt that in the early 21st century, no advertising conglomerate offered as comprehensive 'one-stop-shop' services as Omnicom. They also added that Omnicom might win many more prestigious accounts, similar to the Daimler Chrysler one in the near future.

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Background Note

Omnicom is a holding company which operates through a network of three global advertising agencies, BBDO, DDB and TBWA. Thus, its history needs to be understood from the perspective of the growth and evolution of the various constituent companies.

The group's story began in 1891, when George Batten formed an advertising agency named Batten Co. in New York, US (See Exhibit II for milestones in Omnicom's history). This was one of the first major organized initiatives in the area of advertising services. In 1928, Batten Co. merged with Barton Durstine Osborn, another popular New York based advertising agency, to form Batten Barton Durstine & Osborn (BBDO).

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The history of DDB, an Omnicom agency, can be traced back to 1949, when the Doyle Dane Bernbach (DDB) advertising agency was set up in New York by Ned Doyle, Mac Dane and Bill Bernbach (Bernbach).

Through the 1950s, DDB's business grew rapidly under the direction of Bernbach. Bernbach was the creative force behind many of DDB's advertising successes.3 TBWA, another Omnicom agency, was founded in Paris by Bill Tragos, Claude Bonnange, Uli Wiesendanger, and Paolo Ajoldi. TBWA became the first European advertising company to enter the US advertising market when it set up office in New York in 1977. By the 1980s, TBWA had become a major player in both the European and the US advertising markets. In 1986, DDB merged with Needham Harper Worldwide, a Chicago-based advertising agency, to form DDB Needham. In the same year, BBDO merged with DDB Needham to form Omnicom...

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3] For instance, Volkswagen Beetle's "Think Small" advertising campaign, which was rated among the world's biggest advertising successes, was developed by Bernbach.

 

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