By Leo Marchandon and Mara Vilcu
(Reuters) -French advertising giant Publicis said on Thursday it has reached an agreement to acquire data and ID technology group Lotame and plans to wrap it into targeted marketing unit Epsilon, its main business driver.
The acquisition is expected to significantly boost Publicis’ technological edge in the rapidly evolving digital advertising landscape, expanding its individual consumer profiles to 4 billion from the current 2.3 billion, according to the company.
Publicis did not disclose the terms of the Lotame deal, expected to close early in the second quarter. However, CEO Arthur Sadoun said that the company has invested $1.5 billion in data and technology over the past six months. The company plans to further allocate between 800 million euros and 900 million ($864.6-$972.6 million) euros this year for targeted acquisitions in the technology and proprietary data sectors.
DATA IS KEY
“AI is nothing without data,” Sadoun emphasized in a video announcing the deal, highlighting the role of their 25,000 engineers and the capabilities of their CoreAI system. This technology allows Publicis to track an individual’s complete digital footprint, enabling the advertising giant to predict and influence consumer decisions across virtually all screens and platforms worldwide.
For instance, Publicis’ system can detect a consumer’s financial strain, predict their likely switch to cheaper products and instantly adjust advertising across their devices to promote budget alternatives.
The integrated capabilities of Publicis and Lotame would enable the firm to engage with 91% of all adult internet users, according to Sadoun.
ADLAND’S THREE-WAY COMPETITION
Publicis has outpaced its adland competitors after a decade-long, 12 billion euro transformation, leveraging AI and big data. This has positioned it as the world’s largest advertising firm, pending the planned merger of Omnicom and Interpublic. The merged entity is expected to generate more than $25 billion in revenue.
Delivering customised content to millions of consumers simultaneously has become a basic requirement for major advertising conglomerates, as clients increasingly prioritise personalisation strategies in their campaigns. A mid-2024 Deloitte study noted a corporate shift towards personalisation, with companies increasing their personalisation budgets by 29%.
Publicis said last month that it expects to outperform the market again this year with an organic growth forecast of between 4% and 5%, slightly below 2024.
British rival WPP expects its revenue and profit to be flat at best this year as its shares hit a four-year low following disappointing results in February.
($1 = 0.9253 euros)
(Reporting by Leo Marchandon and Mara Vîlcu in Gdansk; Editing by Jan Harvey, Kirsten Donovan and Louise Heavens)
