Omnicom Wins Coca-Cola's North American Media Account

Omnicom has won Coca-Cola's U.S. and Canada media account, weeks after PepsiCo ended a relationship with the holding company that had lasted almost 30 years, according to two separate sources with knowledge of the deal.

The account is the slice of Coca-Cola's business that Publicis gave up when it took PepsiCo. That PepsiCo relationship is worth an estimated $700 million to $800 million. Omnicom's leadership sealed the Coke deal in a sit-down with Coca-Cola's senior marketing team, one of the sources said.

What did Omnicom promise Coca-Cola?

During those exchanges, Omnicom's senior team, including CEO John Wren, made the case that Coca-Cola would get a team built for it, with no hand-me-downs from the PepsiCo account, the source said. The pitch rested on three commitments: senior talent, savings and tech innovation.

Those are promises every holding company makes in a pitch; what Omnicom could also point to was scale no rival currently matches.

The company is the world's largest media house following its absorption of IPG (Interpublic Group, the advertising holding company Omnicom acquired). It boasts billings of $75.6 billion, roughly 31% of all billings handled by global marketing services groups. Work on the Coca-Cola account will commence Dec. 1.

How does the global split now stand?

The cola wars have a new front, and it runs straight through Omnicom. The arrangement carves up Coca-Cola's media along geographic lines:

• Omnicom: U.S. and Canada media, starting Dec. 1
• WPP: global remit outside of Japan and South Korea
• Dentsu: Japan and South Korea

The structure preserves WPP's longstanding global role while handing Omnicom the largest single market. Publicis, meanwhile, holds the PepsiCo business it traded the Coke slice for — a direct swap that pits two rival holding companies against each other on opposite sides of the cola counter.

One caveat is worth holding onto: Omnicom has promised Coca-Cola a bespoke team with no recycled PepsiCo talent, but the deal's financial terms and the size of the Coke account itself have not been disclosed. The $700 million to $800 million figure attached to this story describes PepsiCo's account, not Coke's.

The win also raises a fair question the sources do not answer: how Omnicom will staff a dedicated Coca-Cola team at the same moment it is integrating IPG and absorbing the disruption of losing a near-30-year PepsiCo relationship. Consolidation at this scale usually trims headcount before it adds it.

What is not in dispute is the timing. Omnicom converted the loss of PepsiCo into the gain of Coca-Cola's North American media within weeks, and it did so while carrying more billings than any competitor in the market. Dec. 1 is when the promises meet the workload.