Is Publicis Groupe planning to challenge out of home specialists Kinetic and Posterscope?

The global out of home advertising market is carved up between two big specialist companies, WPP-owned Kinetic and Aegis-owned Posterscope.

So the other big media players are used to seeing large chunks of commission disappear to these two rivals even when it’s their clients spending money on billboards and, increasingly, digital signage and all the other weird and wonderful things that make up one of the fastest-growing sectors of the media market.

This state of affairs has long bugged Publicis Groupe boss Maurice Levy (pictured) and, prior to the recession which began in 2008, he took a long look at whether Publicis Groupe could muscle into the out of home specialist market with the formation of its own rival to Kinetic and Posterscope.

PG decided not to and, in line with its approach to other media through its VivaKi unit which includes Digitas and Razorfish, chose to pursue technology solutions instead, in outdoor by teaming with technology company DOmedia, which provides automated media buying tools.

Now it’s taken the relationship a step further by integrating DOmedia’s latest technology platform into the out of home media planning and buying activities of Starcom MediaVest, one its two big media buying operations (the other is ZenithOptimedia).

This will be quite a coup, if it works, as out of home has long been viewed as difficult and time-consuming to plan and buy, hence the generous commissions charged by Kinetic and Posterscope which sometimes reach 30 per cent.

If you can do it with the click of a mouse StarcomMediaVest will enjoy a significant operational advantage. As will ZenithOptimedia, presumably, in due course.

But this still leaves the question of what happens to all that highly lucrative business in Kinetic and Posterscope unanswered. DOmedia’s clever technology could end up making PG’s media operations more efficient (and cheaper) but would it rake in some of the money that goes to its rivals?

The answer is probably not so PG may well try to revisit its old idea of forming its own out of home specialist, this time armed with some very useful first mover technology.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.