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Summary
Since 2020, the global communications market has experienced historic growth, driven by an increase in digital advertising spend, which for the first time ever nearly matched traditional media revenues. Europe's market, dominated by the UK, Germany, and France, mirrored this growth, with digital advertising receiving a substantial half of the advertising budgets by 2021 and 2022. In France specifically, despite a challenging 2020 due to the pandemic, with declines in historical media revenues (-18.8%) and a drop in overall communications agency sales leading to revenues lower than those in 2006, the market recovered robustly in 2021 and 2022, regaining lost ground much faster compared to the post-2008 crisis recovery.
The leading players in the French market, such as Publicis Groupe and Havas Group, continued to dominate, with billions in sales (Publicis Groupe with €12.572 billion in 2022). Notably, the sector showed concentration with about 5,789 agencies existing in 2021, averaging 13.6 employees each. The Ile-de-France region housed 45% of the national workforce, although this dominance was decreasing due to new remote work practices. Finally, the top French advertisers across leading sectors like the food industry and automotive continued to invest heavily, with the top 5 advertisers spending a total of €2.5 billion in 2022.
Market Trends and Dynamics in the French Communications Sector
The French communications market is a dynamic and evolving landscape primarily driven by a blend of media advertising, digital integration, and a response to changing consumer behaviors. Observing the demand analysis within this market, we can identify prominent shifts and strategic priorities that define the recent trends. The magnetic center of European market growth resonates from the leading trio of the UK, Germany, and France, with the latter holding a significant role in the continent’s communications vitality.
The market has been riding on an upward trajectory, especially with a historic growth rate in 2021. This growth, between 10 and 15 percent, outshines the performance across two decades, bolstered by factors such as digital momentum and global events like the Tokyo Olympics and UEFA Euro. French communications and advertising players experienced a contraction in 2020 due to the pandemic. However, the market rebounded swiftly in subsequent years, a stark contrast to the recovery period following the 2008-2009 crisis. Digital media, in particular, saw an uptick in revenue, almost leveling with traditional media spend, and marked a pivotal point in investment shifts from other media channels.
The digital sphere's rise to prominence reflects in the spending trends where digital advertising claims nearly half of the total advertising budget. Diving into the digital trends, we witness an assimilation of social networks as central platforms for brand interactions. Short-form video content and influencer collaborations have become mainstays in brand strategy, with video giving rise to remixing practices and sustaining influencer-brand relationships as pivotal to brand projection in the digital milieu. Furthermore, investment in social media advertising has seen a robust increase between 20 and 50 percent in consecutive years, signaling an evolving necessity in the marketing mix.
The top French advertisers are predominantly from the food and automotive sector, which collectively inject between 2 and 3 billion euros into advertising each year. These expenditures spotlight the pivotal role of communications in fostering brand image and competitiveness, illustrating that only well-resourced corporations can afford extensive advertising budgets. While larger agencies have historically dominated the industry, a considerable number of small to medium-sized agencies specialize in niche areas, with the Parisian region hosting nearly half of the national workforce.
Despite these larger agencies monopolizing most of the market sales, agencies employing fewer than 20 people continue to form the majority, highlighting a dichotomy within the market structure. The market's value chain faces strategic challenges, particularly influenced by digital disruption.
Towering Titans of the Communication and Advertising Landscape
As we delve into the vibrant and expansive world of communication and marketing, certain names stand as pillars of innovation and strategic prowess. These major players have not only carved out niches for themselves but have also expanded their reach to offer a diverse array of services that cater to the ever-evolving needs of advertisers and consumers alike.
- Publicis Groupe, with its roots firmly planted in French soil, has established itself as a behemoth in the industry, offering a suite of services that cover every imaginable facet of communication and marketing. This comprehensive approach allows them to meet the diverse and complex needs of their global client base.
- Havas Groupe, another French giant, distinguishes itself through a unique "Village" organizational model, promoting integration and agility across its various agencies. It boasts an exceptional ability to forge strong relationships between brands and consumers, harnessing the full potential of media to deliver impactful messages.
- Altavia remains focused on the retail sector, providing bespoke marketing services aimed at enhancing the shopper experience. They thrive on creativity and are constantly on the lookout for innovative solutions to support their clients in the competitive retail space.
- Across the Atlantic, Omnicom Group stands as a paragon of success, with a vast network of agencies that specialize in areas such as advertising, strategic media planning, and corporate communications, underscoring their status as an indispensable resource for brands looking to make a mark globally.
- WPP from the United Kingdom is a titan of talent and resources, merging the skills of creatives, analysts, strategists, and technologists to deliver next-level marketing and communications services. Their expansive portfolio of companies allows them to orchestrate campaigns that resonate deeply with audiences worldwide.
- Interpublic Group represents a powerful collective of agencies dedicated to filling every communication need imaginable. Their far-reaching footprint and collaborative approach enable them to tailor their services to each client's unique requirements, ensuring both relevance and reach.
- Dentsu from Japan completes this illustrious group, operating at the convergence of tradition and innovation. Dentsu's approach blends respected advertising methodologies with cutting-edge digital strategies, ensuring their place as a leader in the communication sphere.
This pantheon of communication agencies represents the pinnacle of strategic sophistication and execution. Their dominance is not defined solely by their size but notably by their unwavering commitment to understanding and shaping the intricate relationship between brands and their audiences in an ever-digitalizing world.
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Inforamtion
- Number of pages : 30 pages
- Format : Digital and PDF versions
- Last update : 27/02/2023
Summary and extracts
1 Market overview
1.1 Introduction
A communications agency handles all or part of a customer's internal or external communications.
- Internal communication: this helps unite employees around the company's values, successes and future objectives. It reinforces the feeling of belonging to the structure through media such as an Internet site, an intranet or reserved newspapers
- External communication: this enables the company to promote itself and project a positive image to its target customers. To achieve this, it relies on media such as social networks, poster campaigns, print/TV advertising, sales brochures, etc.
However, the term "communications agency" can conceal a variety of realities. These structures may operate in communications, but also in advertising and marketing. Very often, these activities are intertwined, as the customer requires several services that the agency is able to provide.
As a result, some agencies can handle the entire communications process for their clients, while others have more specific areas of expertise.
The world of communications is, by its very nature, a volatile and changing one, which is both trend-setting and conservative, as conformist as it is anti-conformist. In this unstable world, however, the underlying trend is clearly identifiable: social networks are taking on greater importance every day in lifestyles and consumer choices.
The year 2020 has even been a catalyst for this trend due to periods of confinement: digital has taken on an even greater role in our daily lives, revolutionizing the way we work and consume both content and make purchases. Last year, for example, for the first time ever, advertisers' spending on digital reached a share of almost 50% of total communications expenditure.
1.2 A global market full of promise for years to come
While it's relatively complicated to compile data specific only to communications agencies worldwide, it is possible to identify certain market trends thanks to the size of the global market.
Evolution of communication sector figures World, ****-****, billions of dollars Source: ****
Since ****, the global communications market has shown a historic growth rate ...
1.3 European market driven by its leading trio
The dynamism of the communications market in Europe is mainly due to * major countries: the UK, Germany and France, in that order.
Communication market sales Western Europe, ****-****, billions of dollars Source: ****
With an estimated half of these advertising budgets devoted to digital advertising, this is the fastest-growing segment of the ...
1.4 A domestic market emerging from a period of turbulence
**** was a difficult year for the French communications and advertising market. Let's try to analyze the major trends through the different sub-segments of the market:
Historical media Digital media Other media
However, we can see that the French communications market will catch up in **** and ****.
Evolution of communication market size France, ...
1.5 The health crisis has undermined investment in communications
The Covid-** health crisis has had a rather negative impact on communications spending in France in general, and this has been felt across a number of advertising networks.
Impact of the Covid-** epidemic on television advertising spend France, ****, % (***) Source: ****
All the major television groups have suffered from the consequences of Covid-**, ...
2 Demand analysis
2.1 Leading French advertisers
Advertisers are the natural and most instinctive clients of communications agencies. Here are the top ** French advertisers for ****. [***]
From this top **, we can identify the advertising expenditure of the top * as follows:
Advertising spending by the top * advertisers France, ****, millions of euros Source: ****
These * largest French advertisers will spend a total ...
2.2 A sacrificed expense item?
In ****, the economic crisis, a consequence of the health crisis, led to a drop in business investment.
Investment by non-financial companies France, ****-****, % (***) Source: ****
Corporate investment has therefore plunged in ****. While the graph does not only reflect variations in corporate communications spending, it is an interesting indicator to show that in ...
2.3 Publiphobia: a decline in consumer attention
In recent years, consumers have developed a certain rejection of brand communication and advertising campaigns.
This manifests itself in a decline in consumer attention: weary of advertising hype, consumers no longer assimilate information, and no longer wish to be solicited as much.
Share of Internet users using an ad blocker France, ...
2.4 Digital communication trends
As we saw in *.*, for the first time in France, spending on digital communications is almost reaching the level of spending on other traditional media. It therefore seems important to examine this phenomenon and describe the major trends in this market sub-segment.
Consider all social networks to get the most out ...
3 Market structure
3.1 The different types of communications agency
There are many different types of communications agency, each fulfilling different missions, but sometimes complementing each other.
Among these different types of agencies, some have more general or more specific skills, depending on the product to be delivered to advertisers and end-customers.
Major integrated players
French groups such as Publicis and ...
3.2 An increasingly concentrated market
Here's a look at recent trends in the number of communications and advertising agencies.
Number of advertising agencies in France France, ****-****, in number of establishments Source: ****
Companies registered under activity code **.**Z "Advertising agency activity" are included here. We consider this number to be slightly overestimated, as some agencies may ...
3.3 Communications agencies, a symbol of Parisian macrocephaly
Here's a breakdown of the workforce of communications agencies in France:
The Île-de-France region dominates, accounting for **% of the national workforce in ****. However, the COVID-** crisis and the development of telecommuting practices have largely changed practices in this area: in ****, **% of the national workforce was based in Paris, so there is ...
3.4 Typology of communications agencies by size
As well as being based all over France, communications agencies vary in size and sales profile.
Distribution of number of employees by communications agency France, ****, % Source: ****
In ****, nearly three-quarters of companies registered as communications agencies had fewer than ** employees. The French fabric of this activity is therefore overwhelmingly made up of ...
3.5 Strategic challenges for the value chain
The value chain of the communication and advertising market will most certainly be governed in the years to come by :
Advertisers' spending on media communications
As we saw in *.*, the sales of communications agencies depend to a large extent on the dynamism of economic activity in the broadest sense. If the ...
4 Offer analysis
4.1 From general agencies to the most specialized
While generalist agencies generally define themselves as being able to support their customers in their advertising and marketing activities, from conception to completion, others focus on much more restricted areas of expertise. This is the case of specialized agencies.
Among our areas of expertise, we can find agencies specializing in :
Editorial ...
4.2 An offering that adapts to the new digital reality
The growing importance of digital and new types of media in corporate communications and advertising strategies has had a number of consequences for the advertising agency market.
Competition has changed:
A new type of competition has emerged, driven by consulting firms, which now offer products and services that are similar in ...
4.3 The need to integrate new skills
It seems necessary for communications agencies to extend their areas of expertise, and to develop in-house activities that until now they have been accustomed to outsourcing. This new form of work organization enables them to do two things:
Win as many assignments as possible from advertisers; To meet advertisers' demand for ...
4.4 Price trends
Here is the evolution of design prices for services provided by communications agencies since ****:
Trend in design prices for advertising services France, ****-****, base *** in **** Source: ****
With the exception of ****, prices were down overall (***). In ****, prices fell to adapt to the relative reluctance of advertisers to spend on advertising campaigns during ...
4.5 Numerous means of communication
Communications agencies operate in a wide range of media, with each agency, or each department of a large communications agency, specializing in particular media.
First of all, there are the * historical media:
Television Cinema Radio Print media Outdoor advertising
These * media offer a wide variety of communication possibilities for brands that ...
5 Regulations
5.1 Advertising regulation and self-discipline
Advertising is protected by copyright, trademark law and unfair competition.
VisitBook Iof the French Intellectual Property Code concerns copyright.
The mere fact of creation gives rise to intellectual property rights over a work: "The author of a work of the mind enjoys an exclusive intangible property right in this work, enforceable ...
6 Positioning the players
6.1 Segmentation
Here's a list of the main players on the French market.
- Publicis Groupe
- Havas Groupe (Groupe Vivendi)
- WPP
- Omnicom Media group France
- Kwanko
- MGA France
- Edelman
- Meero
- Spaag
- Altavia Group
- dentsu France
- Mnstr
- Eskimoz
List of charts
- Communication market turnover
- Sales trends in the communications sector
- Growth in the size of the communications market
- Advertising revenues
- Trend in sales index for communications agencies
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Latest news
Publicis launches major artificial intelligence plan - 25/01/2024
- Publicis has a market capitalization of 22.5 billion euros.
- Publicis has around 100,000 employees.
- Publicis has 45,000 engineers, IT consultants and data experts.
- The group unveils CoreAI, an internal platform to be used by all employees.
- Publicis bought Sapient for $3.7 billion in 2014.
- Publicis also bought Epsilon for $4.4 billion in 2019.
- Publicis has data from 2.3 billion profiles worldwide and trillions of data points analyzing the commercial performance of campaigns.
Havas leaves Vivendi's fold and jumps into the deep end - 14/12/2023
- Havas is expected to be relisted within twelve to eighteen months.
- The enterprise value of Havas is estimated at between 2.5 and 2.8 billion euros.
- Last summer, Havas acquired a majority stake in the creative agency Uncommon for several tens of millions of euros.
- Havas is a major player in France and the UK.
- Havas is expected to generate sales of around 2.8 billion euros in 2023.
- Havas generates 35% of its revenues in the United States, compared with nearly 60% for the Anglo-Saxon giants and Publicis.
- Havas' operating margin is just over 11%, compared with a range of 15% to 18% for WPP, IPG, Omnicom and Publicis.
Omnicom strengthens its presence in e-commerce - 30/10/2023
- Omnicom has acquired Flywheel Digital for $835 million, the largest acquisition in its history.
- The e-commerce and retail media sector is expected to generate over $100 billion in revenues by 2022, a figure that GroupM (WPP) predicts will double in the next five years.
- Flywheel Digital has over 2,000 employees and almost 4,500 customers.
- Omnicom's e-commerce and retail media competitor, Publicis, recently acquired CitrusAd for around 100 million euros, and Profitero for 200 million euros.
- Omnicom is the sector's second-largest market capitalization, just behind Publicis.
Havas to launch new network - 20/10/2023
- Havas was headed by Yannick Bolloré for ten years.
- Net income for the year ended September 30 was 654 million euros.
- 40% of Havas business is generated in North America
- The Havas Group has made nine acquisitions in 2022 and six from 2023.
- Havas acquired a 51% majority stake in Uncommon, an independent UK creative agency.
- Havas formed a partnership with Mirakl to create the largest independent retail media network for brands and retailers.
- Havas is about to launch a new international network called Havas CX to offer clients "personalized experiences".
- Canal+, another Vivendi entity, grew by 5.7%.
- Revenues from Studiocanal, part of Canal+, rose by 23.6%.
Despite a difficult advertising market, Publicis on cloud nine - 12/10/2023
- Publicis has raised its guidance for the full 2023 financial year, now forecasting organic growth of between 5.5% and 6%
- Publicis has passed the symbolic threshold of 100,000 employees worldwide.
- Publicis plans to massively deploy artificial intelligence features internally to improve staff productivity.
Communication: Mnstr, the Annecy-born agency thriving in Paris - 11/09/2023
- Mnstr founded: 2009
- Relocation of headquarters to Paris: 2021
- Number of employees: approx. 50
- Sales in 2022: €10 million
- Annual growth rate since inception: 20-30
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the communications agency market | France
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