New York – January 2019 – Agency business being put into review in 2018 has contributed to a 7.5% increase in global new business revenue, according to a recent report by independent consulting firm, R3. Based on their analysis of 7,000 agency new business wins, global new business revenue increased from $2,9b in 2017 to $3,1b in 2018.
Global Revenue Increases, Number of Wins Decreases
Despite an increase in overall global revenue, the number of wins decreased 5.5% YoY. This is mirrored on the creative side, which experienced a 2.4% increase in new business revenue in 2018 on 10% fewer wins. However, on the media side, new business revenue increased 18.4% ($931m in 2017 and $1,1b in 2018) on a 2.3% increase in number of wins.
“In this moment of truth around media ROI and transparency, marketers are putting accounts up for review to leverage compliance and start taking a more rigorous business approach to re-addressing contracts,” said Greg Paull, Principal and Co- Founder of R3.
US Continues to Drive a Significant Amount of New Business Activity
This rise in media wins was driven by the US, where revenue was up 49.2% YoY. In this market, BBDO and Starcom led the way, winning creative for Ford and media for Fiat Chrysler respectively.
Five out of the top ten global wins for creative agencies were in the US in 2018, while for media agencies the number is four out of ten. In terms of number of wins in the US alone, total creative wins are down 0.6% and media wins are up 12.1% YoY.
“The generally healthy US economy is encouraging marketers to innovate and optimize their budgets,” said Mr. Paull. “They’re doing it by moving towards new and hybrid agency models that allow for more flexibility in media and production costs.”
Publicis Groupe Leads the League on Revenue
On the holding company level, Publicis Groupe saw a significant jump in revenue to $723m, closing out 2018 on top, followed by WPP, Dentsu, Omnicom and Interpublic Group. Their success was driven by strong performances from Publicis, who won Mercedes-Benz’s global creative business back in January, Saatchi & Saatchi’s win of Campbell’s Soup and P&G’s North American Fabric Care account and Leo Burnett awarded Samsung’s visual display business in July. On the media side, Publicis Media and Starcom rank third and fourth on the top ten global media wins, with Spark Foundry in sixth place.
Both Publicis and Havas generated 6% of additional holding company revenue from New Business this year, well above the 3.5% average. WPP, ranked second, generated 2,8% of additional new business.