Publicis Groupe has recently released a yearend report, detailing the performance of the Groupe in the last year and reiterating the restructuring that it believes has begun to show some early results.
In numbers, the Groupe’s revenue approached 10 billion Euros; net income reached 900 million Euros, whilst free cash flow exceeded 1 billion Euros. The Groupe has more than 78,000 employees now, much of which can be contributed to the Sapient acquisition and the benefits from a favorable currency effect.
“Despite these new records, however, we bear in mind that our organic growth, at 1.5 percent, did not reflect our capabilities stated Maurice Levy, Chairman & CEO, Publicis Groupe in a message in the yearend report. He said, “Looking at these figures, you might think that 2015 was plain sailing. Nothing could be further from reality. 2015 was an extremely active year on account of the numerous challenges we are facing, as can be seen in the unfolding of the year’s different chapters, some of which are key for our future and that of our sector.”
Mr Levy also reminded that in the 2014 activity report’s message, Publicis Groupe evoked the acquisition of Sapient, which will help it in a unique way to transform its organization and broaden its range of services. The creation of the Publicis.Sapient platform went smoothly, producing in an “unrivalled force within the digital universe”. The targets the Groupe had fixed for the integration and synergies were rapidly reached, and at times exceeded. During the first part of the year, Sapient’s activity was affected by sudden raw materials price movements, but recovered during the second half-year. However, this was not true for the other components – DigitasLBi, Rosetta and Razorfish – each for specific reasons.
“The most important thing is to confirm that our project with Publicis.Sapient to build the most comprehensive and richest offering on the market, covering all service segments that call upon digital and technology, has become actual reality (internet, digital communication, ecommerce, consulting, technology, etc),” Mr Levy writes in the message.
Taking stock of the journey through the year, he observed that the creative agencies experienced a year with strong competition, and “performed outstandingly in terms of creativity”. The ‘Like a Girl’ campaign for P&G received an impressive number of awards and is akin to a true social movement. Numerous other successes can be noted, as well as some great victories following fierce competitions, which, amongst others, enabled Publicis Communications to return to solid growth. The media agencies experienced mixed fortunes.
Starcom Mediavest Group (SMG) suffered from the mediapalooza, the famed tsunami of media budget competitions, as customers including P&G and Coca-Cola ceased their media collaboration with the agency in the United States, although the partnership on other aspects of their collaboration is continuing and growing stronger.
“Despite this intense activity, we devoted ourselves resolutely to preparing for the future, which we know will be conditioned by several key words, such as ‘digital’, ‘uberization’, ‘transformation’, ‘flexibility’ and ‘velocity’, in the era of the fourth industrial revolution. Our clients are faced with competitive battles of an extraordinary intensity and passion. Hence, the first question that we need to ask ourselves is that of our adaptation to this new world. Our analysis at the time of the Sapient acquisition was that our competitive universe would be expanding – something that we have seen – with numerous consulting firms that have moved into the digital field through acquisitions,” Mr Levy noted.
With a speed that is rarely seen in large groups, Publicis Groupe has put this new organization in place – leaders, concepts, operating model – and as per Mr Levy, has already started to see the results. He said, “We are very confident in our ability to help our clients transform, thanks to the consulting and technology skills of Publicis.Sapient, our intimate understanding of brands and consumers, our approach, always marked by its creativity, and the simple, fluid and open access to all our assets for every client (No silo, no solo, no bozo).”
He summed up the message, stating, “More than ever, Publicis Groupe remains loyal to its pioneering tradition. It will not be long before the foundations that we have built for our unique model will start to bear fruit, and we will be able to take full advantage of a future for which we are better prepared than most of our competitors.”