Morningstar | Publicis Is More Leveraged Than Its Peers Toward Faster-Growing Digital Advertising
Publicis is the third-largest player within the advertising space (based on revenue), operating in more than 100 countries worldwide. We expect Publicis to maintain its market position as the firm continues to make acquisitions. In addition, we believe the firm’s restructuring will likely help it generate competitive organic growth, increase focus on the faster-growing emerging and the overall digital ad markets, and maintain margins at levels above its peers.The firm has transitioned from traditional advertising into a complete solution provider with digital, and other services such as consulting and public relations, through various acquisitions. Only one year after ending merger talks with Omnicom, Publicis made one of its largest acquisitions, the purchase of the marketing and consulting firm Sapient, in 2015. We look for Publicis to continue its acquisition growth strategy to gain further traction in other faster-growing international markets.The firm has also taken steps to operate the many companies under its umbrella more efficiently. Through the firm’s reorganization, which began in 2016, Publicis is structured to provide more effective and easily measurable integrated services for its clients; along with more centralized back-office management, this has increased efficiency, which is evident in margins higher than those of other players in the ad space.We expect Publicis to continue acquiring and investing in the growing digital market. Clients of Publicis and its peers are allocating more ad dollars toward below-the-line, or more targeted, digital campaigns, creating growth opportunities for Publicis. The firm has made headway on this front, as more than 50% of its revenue is from digital. In addition, as Publicis’ larger clients favor omnichannel or multichannel marketing campaigns, additional acquisitions and investments, along with shared resources and expertise across the solution groups, help make Publicis platform-agnostic and a one-stop shop.Publicis is holding company. Through its subsidiaries, Co. is engaged in marketing, communication and digital transformation. Co. designs a customized package of services to meet each client's particular needs through a holistic and global approach. In addition, Co. provides financial markets with information concerning the relative size of each of the different business sectors for the sole purpose of allowing sector comparisons. Co.'s principal activities comprise four main categories: Digital, Advertising, Specialized Agencies and Marketing Services (SAMS) and Media.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
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