Ad giants’ merger highlights growth of big data in marketing

The announcement this week of the merger of two of the biggest names in the advertising industry has indicated that this sector has begun to fully embrace the concept of big data and move towards new ways of improving their operations.

US firm Omnicom and French brand Publicis Groupe had combined revenue of $22.7 billion in 2012 and the merged enterprise will aim to bring the companies firmly into the digital marketing world and compete with leading names in the sector such as Google – which made the majority of its $50 billion revenue last year from its advertising activities.

The Omnicom/Publicis merger will aim to make both firms much stronger in online and digital advertising, which the New York Times observed is the fastest-growing sector of the industry at the moment. The publication said that while television advertising is still the largest sector – worth $66.35 billion in the US alone last year – online is quickly catching up. In 2012, this generated revenues of $42 billion.

A key factor that is driving the growth in online marketing is big data analytics. With so much more information on potential customers available than ever before, being able to turn this into useful insight that can guide decision-making is crucial to the success of campaigns. But traditional data analytics are often not up to the task of handling such large volumes of information, which is where big data tools come in.

These can be used to evaluate vast quantities of details in order to create more personalized marketing materials for each customer in real-time, monitor browsing and purchasing history to identify key trends and keep up with wider industry developments, among many other uses. In fact, so vital is big data to the digital marketing sector that it was cited by Publicis as one of the key reasons why the merger with Omnicom was necessary to keep pace with the evolving industry.

Maurice Levy, chairman and chief executive of the French firm, stated: "The communication and marketing landscape has undergone dramatic changes in recent years including the exponential development of new media giants, the explosion of big data, blurring of the roles of all players and profound changes in consumer behavior."

He added this evolution has resulted in the company's clients facing huge challenges, as well as great opportunities for growth, provided these new factors are harnessed properly. He added the new Omnicom/Publicis merger will help enterprises achieve this by offering the industry's most comprehensive range of offline and online marketing services.

The New York Times noted the merger is a clear sign that the advertising industry is becoming more personalized, based on information consumers may not even be aware they are sharing, such as browsing habits, social media activity and credit card purchases.

Omnicom's chief executive John Wren was quoted by the publication as saying: "Collecting big data and being able to turn it into insights is the ambition of both companies and it will be the ambition of the single company."