‘Fewer creative pitches’
For 2023, the Groupe is currently predicting organic growth of 3% to 5%. That is well above the flat predictions currently given by analysts due to the macroeconomic environment, said Sadoun. “We feel very confident that we will be able to build on our three-year momentum,” he said.
He added that the new business pipeline is currently good, particularly in the media sector. However, he said, “There are fewer creative pitches every day, because clients prefer to add partners or reduce partners on a project basis than completely and radically changing agencies in most cases.”
The company tried not to pass on any inflationary costs to its clients in 2022; for 2023, it expects to pass on inflationary costs at a maximum of 1%, said Sadoun.
The performances of Epsilon and Sapient, which recorded organic growth of 12% and 19%, respectively, were also major contributors to the Groupe’s full-year results. Data and technology now represent a third of the Groupe’s revenue, with increases coming from clients across the board, said Sadoun. The data and tech businesses were also helping its media and creative activities gain traction, he added.
“We are capturing a disproportionate share of our clients’ spend in first-party data in digital media, in commerce and in business transformation,” he said. “But this is also having an impact on our media and creative business. By putting Epsilon and Sapient at the heart of our model, so we can boost our media and creativity through data and technology, we can present ourselves not as a communications partner but truly as a transformation partner for our clients, which is even more important in the difficult economic times we are going through.”
While media grew strongly in 2022 on the back of new business wins such as Mondelēz’s $500 million media account, PepsiCo’s media in China, LVMH’s media in the U.K. and France and Anheuser-Busch InBev’s global media, creative activities resulted in single-digit growth. Sadoun said this was still an “achievement” and above the industry average. The company’s biggest creative win last year was the global business for Standard Chartered bank.
“Our ability to bring data and technology together to produce dynamic content is truly a game changer when it comes to creative,” he said.
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