Omnicom is paying about $US835 million to acquire Flywheel Digital, an ecommerce service enabling brands to sell more goods more efficiently across hundreds of digital marketplaces, such as Amazon, Walmart and Alibaba.
"This will make us stand apart," says Omnicom CEO John Wren.
Flywheel, with a workforce of more than 2,000, provides services in retail commerce operations, media execution and market intelligence to more than 4500 brands.
It is being sold by a Ascential, a UK company which owns the Cannes Lions festival.
Omnicom, which first looked at building capability, went with buying because Flywheel has a significant lead in the market which would take years to catch up to, says Wren.
Ecommerce sales worldwide are forecast to increase by 50%, reaching about $7 trillion by 2025.
"The acquisition of Flywheel significantly broadens our reach and influence in the rapidly expanding digital commerce and retail media sectors, two of the fastest-growing parts of the industry," Wren says.
"Together, we will seamlessly integrate our offerings across retail and brand media, digital and in-store commerce, and CRM, ultimately delivering superior results for our clients."
The business posted about $300 million in revenue for the 12 months to June 30. Omnicom sees upside through organic growth and leveraging Flywheel solutions with Omnicom’s existing client base.
Flywheel will operate as a Practice Area within Omnicom and will be led by Duncan Painter who currently serves as CEO of Ascential.
"By connecting Flywheel Commerce Cloud's product and transaction data with Omni's audience and behavioral data, we are poised to offer an end-to-end set of services that outpaces the competition," says Painter.
"We aim to empower our clients to automate, optimise, and measure their digital commerce and media spend within an increasingly complex marketplace."
The acquisition is expected to close in the first quarter of 2024.
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