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Current global advertising scenario

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  1. 1. Current Global Advertising Scenario Vasanth.P
  2. 2.  The agency business has come back to life, with U.S. revenue jumping 7.7% domestic market led a 2010 worldwide rebound in advertising and marketing services. Digital marketing led the charge, accounting for 28% of agency revenue. The U.S. was the worlds star performer in 2010 for advertising and marketing services, exceeding expectations and outpacing growth in most other regions.
  3. 3.  The U.S. advertising and marketing-services firms have added 23,100 jobs since ad industry employment hit bottom in February 2010. The study finds that the Big Four agency holding companies -- WPP, Omnicom Group, Publicis Groupe, Interpublic Group of Cos. in 2010 added 11,000 jobs (including acquisitions) after slashing 22,000 jobs in 2009
  4. 4.  2010 revenue for marketing-communications agencies including advertising, marketing services, media, health care and public relations rose 7.7% to $30.4 billion. Shares in WPP, Omnicom and Interpublic in first-quarter 2011 reached their highest levels since pre-recession 2007, a sign of investors optimism about the sector. Publicis shares this year reached their highest point since 2000.
  5. 5.  Ad spending and employment remain well off their peak. Publicis ZenithOptimedia says U.S. ad/marketing-services spending wont break its 2007 record until 2013. U.S. ad and marketing-services firms employ 76,500 fewer people today than at the industrys pre-recession, late-2007 peak.
  6. 6.  Omnicom in 2010 reported 8.7% revenue growth after factoring out acquisitions/divestitures and the impact of foreign exchange, beating its 6.4% worldwide revenue growth In 2010, Interpublic reported robust 10.1% organic revenue growth, and Publicis posted 9.9% organic growth in North America, better in both cases than any other single region except Latin America.
  7. 7.  Revenue for the worlds 50 largest agency companies totalled $62.2 billion in 2010, up 9.4%. U.S. revenue for those firms jumped 11.4%. The U.S. accounted for 42% of the top 50 agency firms worldwide revenue. Marketing-communications companies have returned to merger-and-acquisition mode, doing a lot of buying and some selling.
  8. 8.  in April 2011, WPP agreed to buy Commarco Holding, a German agency group controlled since 2003 by a private-equity firm. WPP completed 25 small and midsize acquisitions in 2010, including Canadian agency Taxi; I-Behavior, a U.S. database marketing firm; Marketing Direct Inc., a U.S. marketing-services company; and U.S. digital agencies Blue State Digital and Digitaria. WPP also rolled up four WPP shops into Possible Worldwide, a global digital agency.
  9. 9.  Took majority ownership of Clemenger Group, an Australian agency company in which Omnicoms BBDO Worldwide had been a minority investor since 1972. Omnicom also purchased Communispace, a digital market-research- services firm; bought The Modellers, a market-research company; acquired The Core, a U.K. design and branding agency; bought Sales Power, an in-store promotion company in China; and purchased a majority stake in Maslov PR, a PR agency in Russia. Omnicom disbanded pioneering digital agency, splitting its offices among TBWA Worldwide network agencies. Omnicom sold a majority stake in U.S. PR firm Bordeur Partners.
  10. 10.  Omnicom is undertaking a global review of operations with the aim to reorganize or dispose of what "non-core, low-growth, low-margin businesses. generally in smaller markets." As of April 2011, Omnicom had disposed of units with combined annual revenue of about $120 million.
  11. 11.  Made two deals in Brazil, buying digital shop AG2 and a 60% stake in agency firm Talent Group. Publicis also acquired PR firms Eastwei Relations (now Eastwei MSL) in China and Interactive Communications Ltd. (now ICL MSL) in Taiwan. Publicis bought U.K. integrated/digital-marketing firms Airlock, Chemistry Communications Group, Holler and Kitcatt Nohr. Publicis agreed to sell its 56% stake in U.K. PR firm Freud Communications back to Chairman Matthew Freud.
  12. 12.  Bought U.K. shop Delaney Lund Knox Warren from agency firm Creston, making the renamed DLKW Lowe the U.K. hub of Lowe Worldwide. Interpublic increased its stake in Brooklyn-based digital agency Huge to 75% from 51%. The company did two deals in Brazil, acquiring digital shop Cubocc and merging McCann Ericksons Brazil operation with local agency W/Brasil. Interpublic sold U.S. PR agency MWW Group.
  13. 13.  Dentsu Inc. bought U.S. digital ventures Innovation Interactive ( 360i) and Firstborn. The Japanese company set up Dentsu Network West as a New York-based network for its agencies in the Americas and Europe. Aegis Group bought Mitchell Communication Group, an Australian agency firm.
  14. 14. THE END