Why Omnicom Is Being Extra Cautious About Generative AI Than Different Holdcos


Whereas different holding firms are making flashy bulletins about their AI roadmaps, Omnicom is focusing extra on a distinct shiny object: retail and commerce media.

Omnicom closed its $845 million acquisition of ecommerce platform Flywheel Digital in early January – the largest acquisition within the firm’s historical past.

However the hefty price ticket is price it, Omnicom Group CEO John Wren informed buyers throughout the firm’s This autumn earnings name on Tuesday, as a result of it “opens up a completely new market alternative” for the holding firm.

Flywheel Commerce Cloud accommodates product gross sales information, which enhances the viewers and behavioral information in Omni, Omnicom’s information and analytics platform. Collectively, these instruments can assist shoppers drive gross sales and higher measure ROAS, Wren stated.

The acquisition may also generate new enterprise for Omnicom. For example, Flywheel has deep experience in consumer-packaged items, he stated, an space that “has by no means been as sturdy because it might be for Omnicom.”

And as third-party cookie deprecation continues, Flywheel information offers a greater understanding of customers with out the necessity for cookies, based on Paolo Yuvienco, EVP and CTO of Omnicom.

Sluggish and regular

But as beneficial as Omni’s “trove of knowledge” is by itself, Wren stated, generative AI can assist staff use the info to make, plan and deploy advert campaigns extra successfully.

Along with weaving generative AI into Omni by partnerships with Microsoft, Google, AWS and Adobe, Omnicom has a digital assistant instrument known as Omni Help that makes use of massive language fashions to “make the roles of our folks simpler and the work for our shoppers higher,” Yuvienco stated.

For instance, the instrument can routinely summarize client insights and business developments and determine methods to optimize efficiency throughout viewers, media and content material. Consumers can even use the assistant to draft a artistic transient or media plan and automate viewers matching between Omni and different media platforms. Staff can ask the instrument questions by way of a conversational interface, à la ChatGPT.


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Omnicom additionally has a cope with Getty Photographs to make use of the latter’s generative AI instrument, which is educated solely on Getty’s licensed picture library, “so our businesses can produce commercially protected and legally indemnified, custom-made photos,” Wren stated.

But not like peer holdcos Publicis Groupe and WPP, Omnicom hasn’t come out with an AI technique assertion. However that doesn’t imply it’s sitting idly by both.

Omnicom has been testing fashions with its companions and dealing with just a few shoppers who’re “very conscious of the dangers related to it,” Wren stated, and perceive that experimentation means “we’re going to interrupt just a few issues.”

Whereas Omnicom has “traditionally invested tens of billions of {dollars} in AI,” Wren stated, generative AI stays “unknown territory.” It’s nonetheless a comparatively new expertise, with potential dangers starting from inaccuracy to copyright infringement to off-brand branding and messaging. Firms should tread fastidiously in order to not expose shoppers to threat, he stated.

“Know-how at all times travels sooner than society’s skill to soak up it and the legal guidelines and laws that typically observe it,” Wren stated. “We’re going to place the consumer’s curiosity and security above all.”

The large image

Zooming out, Omnicom earned $14.7 billion in full-year 2023 income, a 4.1% natural improve from $14.3 billion in 2022. Its This autumn 2023 income was $4.1 billion, up from $3.9 billion within the fourth quarter of 2022.

Promoting and media, which Omnicom treats as a single class, grew 9.3% in This autumn 2023 in comparison with This autumn 2022.

Omnicom forecasts full-year natural income development of between 3.5% and 5% in 2024.

The corporate expects the pharmaceutical and auto sectors to remain sturdy and the Summer season Olympics and the US presidential election to gas income this 12 months.

“Presidential election years are typically excellent for the economic system,” Wren stated. “And there will get to be some rigidity within the media marketplaces, particularly within the US, as you get later within the 12 months. That forces folks to make choices sooner.”


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