Publicis and WPP have touted large investments in AI. The former has committed a whopping $326 million over the next three years to fuel its CoreAI initiative. WPP has invested over $300 million in AI in 2024 alone.

As we know, successful AI models need to be trained on huge data sets. A larger scale means AI will benefit from more data across a broader range of clients, campaigns, and regions.

“The more data fed into AI, the better it works, [making] a bigger agency entity potentially more successful with AI,” said Myles Younger, head of innovation & insights, U of Digital.     

Yet, these ad-holding giants face stiff competition from smaller agencies and AI startups, both offering faster, more cost-effective AI services, disrupting traditional ad models.

Integration and data differentiation challenges

While Omnicom and IPG aim to become central players in the data and identity arms race, they face inherent limitations by being part of a holding company model.

While the holdco structure can offer cost efficiencies for clients, it also restricts their ability to be fully agnostic in data offerings, unlike independent players like LiveRamp, said Shiv Gupta, founder, U of Digital.

“Any of these tech stacks—Epsilon, Acxiom, and Oracle—which all position themselves as data or identity solutions, lack meaningful differentiation,” said Gupta. “The ceiling is generally similar for all three.” 

Integrating tech stacks, merging Acxiom’s data, Flywheel’s commerce media, and Omnicom’s legacy operations, will require careful execution.

“How do they bring the teams together thoughtfully? How do they integrate tech?” said Gupta.

These decade-old agencies will also need to adapt quickly enough to fend off nimble competitors using more modern models and technologies. A larger agency could become “less flexible and slower to react,” said Mateusz Ruminski, VP of product, PrimeAudience.

Ultimately, the success of the acquisition hinges on how they leverage data—key to AI success—and identity solutions to strategically pitch and win new business.

“Publicis has created the blueprint on this,” Gupta said. “Why Publicis is winning on the back of Epsilon is because they do a good job of telling the story of why having a unified data stack is so valuable, in the new business pitch.”