Omnicom is forecasting organic revenue growth of between 5% to 6% for 2022.
The global advertising group just posted organic growth of 10.2% for the full year to December, and total revenues lifted 8.5% to $14.289 billion.
And the company sees more upside ahead with most of the 2022 lift in the second half, according to a briefing of market analysts.
With that growth will come increased costs, mainly in salaries as Omnicom returns to strength and staff start moving about, visiting clients.
CEO John Wren: “We anticipate that they're going to be a little slower in the first quarter, and possibly even in the first five months of the year because of the (COVID) variant and that kind of put markets back on its heels a bit.
“But we see it fully coming back by the second half of the year. So, we've taken that into consideration.”
He noted, however, that some Omnicom agencies are servicing sectors that have had a more difficult time with the supply chain than others.
“We've been, I think, reasonable, if not conservative in our estimates of what kind of revenue we expect to see,” he says.
“The growth that we're projecting really is a result of the many wins that we had this year -- both new clients, but also expanding our services to existing clients.”
Wren says the company ended the year with employee numbers about pre-pandemic levels, to a little over 70,000 from about 65,000 people.
“There is no denying that there is wage inflation and that we've been coping with this and dealing with it,” he says
Wren noted two areas where growth would come from next year.
“One is in continuing to win new business, but as importantly, to extend services in areas that we're not currently servicing long-standing client relationships.
“With the pace of change in the digital space accelerating, we've continued to evolve our existing capabilities and invest in new and innovative offerings to meet the needs of our clients and future prospects.
“These efforts have allowed us to be extremely competitive in the marketplace by providing a suite of services and capabilities that position us to reimagine and strengthen our clients' businesses, brands, services and products.
“Seamlessly connect them with their consumers across the marketing journey by leveraging Omni, our insights and orchestration platform, transform their marketing and customer relationship technology platforms and innovate in digital, e-commerce and new media channels.
“One area where these investments are making a demonstrable impact is in our Omnicom Precision Marketing Group, which offers martech and digital transformation consulting, decision sciences, customer experience design and targeted customer marketing programs for our clients.”
In November, Omnicom closed on the acquisition of BrightGen, a Salesforce Summit Partner that will extend Salesforce capabilities and reach in Europe.
Wren says the success of Omnicom's Precision marketing offering is reflected by the group's wins with some of the world's largest brands such as Phillips, Mercedes, Nike and Diageo and by its financial results. The precision marketing discipline grew by 19% in 2021.
A slide from Omnicom's briefing of market analysts:
He says a key emphasis is to continue to fill the demand for services across the marketing journey by offering more to current clients and winning new business relationships.
“Our objective in part is to increase the number of clients who consolidate more of their services with Omnicom,” he says.
“These are significant growth opportunities for us where our suite of services, creativity and culture of collaboration, all supported by Omni give us a competitive advantage.
“In addition to our integrated wins, our world-class talent and agencies had numerous recent new business wins within their specialties and across geographies. Our success on our wins in 2021 has resulted in us expanding our services and continues to inform our priority investments and M&A strategies.
“We are also increasing our investment in such areas as AI and automation, e-commerce, performance media, data and analytics as well as in high-growth industry opportunities such as gaming and the metaverse.”
Omnicom also recently completed the acquisition of Propeller, a digitally native engagement agency specialising in health care, another area Wren sees as strong growth.
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