Omnicom’s $750M savings goal to include job cuts post IPG buy

During Omnicom’s fourth-quarter and annual earnings call, group chairman and CEO John Wren pointed to post-acquisition job cuts as one of the ways the company will achieve $750 million in savings. 

The company intends to increase cost savings by “streamlining the holding company, middle office, and regional positions, as well as from eliminating duplicative overhead back office and third-party expenses across its larger combined global footprint," remarked Wren. He, however, emphasised that employees dedicated to servicing clients and “generating revenues” are shielded from this impact. 

Speaking about talent, he said, “We will adopt an approach focused on selecting the best individuals across the organisations irrespective of their current affiliation. With Unified Practice Area leadership teams at global, regional, and country levels, we will eliminate redundant roles, functions, and back-office operations which we expect will generate cost savings exceeding $130 million.” 

As per the CEO, they expect to cut approximately 40% of the company’s corporate expenses resulting in compensation savings of around $200 million and about $100 million in general and administrative costs. 

The combined entity – also called Omnicom – will generate 85% of its revenues from its top 10 markets with the remainder primarily distributed across an additional 40 markets worldwide.

Omnicom will maintain IPG’s agency brands whilst aligning them within the Omnicom Advertising Services (OAS) structure, says Wren. In the top 10 markets, the agency brands will be fully present. A single OAS leader will look after the agency brands in the other markets, and report to the regional OAS head. 

“IPG’s other marketing and advertising services will be aligned within our respective practice areas,” he remarks. 

Shareholders of both agency-holding companies will vote on the acquisitions during a special meeting set for March 18, 2025.