Advertising is a tricky business. It’s the move that could make or break your game. Today, a lot of research goes into determining how to market and what to market. Advertising agencies have been churning revenues out of simple algorithms that targets a group of relevant customers and deliver ads to them. LBi is such an advertising agency that puts out dedicated ads to targeted population. It was acquired last year by Publicis Group for a whopping $514 million. Publicis has now merged the two brands it owns, Digitas and LBi under a common banner called the DigitasLBi.
Digitas is an international advertising agency that was founded back in 1980 and it caters to approximately 28 countries. It has for long seen the international advertising market and the trends that come up and how they die to give way to new ones. LBi on the other hand is relatively newly founded and brings a breath of fresh air to Digitas. The merger, according to Digitas official statement is carried out to increase the client base for both the organizations.
The biggest reason however is to put together an organization that is massive in both geographical advantage and also scale. The major operation would be in the US but Amsterdam opens the doors to Europe. In Asia-Pacific, Digitas is present in India, Australia, Indonesia, Singapore, Malaysia, China, the Philippines and Thailand. LBi has offices in Australia, India, China and Singapore and will merge with Digitas in these markets. Publicis group has always been eager to merge and acquire. It now has two global digital networks that have revenues in the excess of $500 million viz. DigitasLBi and Razorfish. Other agencies that it owns are Rosetta and Rokkan.
Mergers and acquisitions like such drive the market and maintain a healthy competitive existence for all the clients too. Some big companies sell a part of their technology base to other companies while maintaining their other holdings intact – case in point the Facebook and Microsoft ad platform deal. But such deals lay a negligible impact on the revenue but a lot of impact on the market share.
Image Courtesy | designweek