Publicis steps up rivalry with WPP by merging digital agencies

Publicis steps up rivalry with WPP by merging digital agencies

Publicis is to merge its Digitas agency with LBi, another marketing and technology agency it acquired last September, so that it can go head to head with Sir Martin’s AKQA. The two advertising chiefs are racing each other to establish their respective groups as the biggest digital agency in the world.

WPP bought a majority stake in AKQA last June, in a deal valuing the firm at £350m. The group has said it wants to secure 40pc of its business from digital advertising within the next four years.

Just a few months later, Publicis acquired LBi for €416m (£333m) cash.

The deal was seen as the latest blow in Publicis’ battle for digital supremacy over WPP, and today’s merger of LBi and Digitas will ratchet it up another notch. “Digital is the fastest growing element of the marketing industry bar none, so the companies at the forefront of this [will determine the fortunes of the wider agencies],” a source said.

Both digital agencies operate worldwide but Digitas is particularly strong in America, while LBi’s strength is in Europe. The combined organisation, DigitasLBi, will have 5,700 staff across 28 countries.

“Advertisers need a truly integrated and global digital network that can anticipate trends, forecast the ‘next’ while constantly innovating in our ever-changing world,” Mr Levy said: “The combination of Digitas and LBi will create the world’s leading concentration of digital skills.”

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