WPP, Omnicom and even Dentsu have a good day at the office (thanks to Amazon and eBay)
By Michael Bürgi • September 5, 2024 •
Ivy Liu
Omnicom, Dentsu and WPP can all order takeout tonight — not because they’re still stuck in the office trying to win big pitches, but because they all landed a piece of a giant tech platform media business in the last 24 hours.
First, the big news: Amazon’s decision to place more than $2 billion in media spend was announced with a bit of a surprise: both Omnicom and WPP shared the win. Amazon handed WPP, as in GroupM, media duties for EMEA and APAC — helping that troubled holding company with much-needed new business in Europe, and a big boost in India and Australia, which offer the best potential for growth in APAC for the client. (Remember, China has its own dominant e-commerce business.) Consultancy MediaSense managed the review.
According to Comvergence data, in 2023 Amazon spent $2.6 billion in North America and $133 million in Latin America. The e-commerce giant spent $1.6 billion in EMEA and another $725 million in APAC.
Sources close to the decision say it’s best to cut Comvergence estimates in half to get a more accurate read on what the two holdcos will actually have to spend, since Amazon does some measure of investment in house.
Could this win help turn the tide for WPP, which has lost L’Oréal, Sky Media and — as noted below, eBay — along with others since summer began? Five observers, all of whom spoke on condition of anonymity, think that’s very possible. And WPP remains the largest of all holding companies when it comes to presence in EMEA and APAC, noted media analyst Brian Wieser.
But the real tell will be if WPP is able to defend all or at least some of Unilever’s business — the decision is expected any day now before the end of September. Not to be overlooked is Volvo’s $450 million media business, which is currently handled by GroupM’s Mindshare and is also in review.
Meanwhile, Omnicom Media Group landed the Americas business, encompassing a larger amount of media spend overall. This comes on the heels of successfully defending VW and landing Michelin’s global media and others — accounts that tally some $5 billion in media-spend wins over the course of the summer.
Neither holding company would comment for this story, referring interview requests to Amazon.
“We appreciate the discussions with of all the world-class agencies we met during our search,” said Amazon spokesperson Margaret Callahan in a statement. “We particularly want to thank IPG, who has been a fantastic partner over the last 10+ years, and we’re grateful for all their work and continued partnership for the other significant areas of our advertising business, including AWS, Amazon Ads and Amazon Business.”
Indeed, IPG, the incumbent on all of Amazon’s business, didn’t lose out entirely — holding onto AWS, Amazon Ads and Amazon Business. Still it’s a big loss. IPG didn’t respond to a request for comment.
Rivals pointed to the three finalists — and sources confirmed that IPG was in it until the end — as manipulating the upfront marketplace by holding out billions of client spend as a lure to win the account — and even holding scatter dollars aside for Amazon’s ad machine to gobble up. They allege those moves led pricing to plummet and players like Disney+ and Max dropping their CPMs by up to 50% from 2023 rates, citing an “enormous conflict” for any agency winning Amazon’s business.
But other sources close to the pitch insist those backroom sweetheart deals were not part of the reasons for the win — and questioned whether they happened at all. These sources explained that the wins were handed out on technical merits of the winning media agencies, noting that Amazon is a very operationally focused company, and was drawn to those skills on the agency side.
Somewhat overshadowed by the Amazon decision, Dentsu’s iProspect landed eBay’s global media duties, which comes on the heels of the agency expanding its remit into the U.S. with Reckitt’s nutrition business.
“iProspect stood out for their passion of the eBay brand and their strong operating model,” read a statement from eBay. “Their support will be critical as we focus on full-funnel campaigns that are integrated throughout the entire buying and selling journey.”
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