The advertising industry is undergoing a structural reset. As Omnicom brings together multiple agency capabilities, questions around scale, talent, AI and the future of the traditional agency model are becoming increasingly relevant. In an exclusive AdMirror × FPJ Video Podcast with Kalpana Ravi, Nitin Karkare, Chairman, Omnicom, discusses what consolidation means for clients and talent, why AI should be viewed as an efficiency multiplier, and why agencies need to focus relentlessly on profitable growth.
Does scale matter?
Scale, according to Karkare, creates the ability to make investments that individual agencies may not be able to make on their own. Talent development, technology and proprietary research are three areas where a holding company can invest at greater scale.
For clients, the proposition is equally broad: from consulting and brand building to digital, CRM and last-mile conversion, Omnicom can bring multiple capabilities under one ecosystem.
What about talent?
Karkare believes scale can also create career mobility. Employees can move across disciplines and agencies instead of having to leave the organisation to acquire new skills.
But he believes the industry must do more to develop its next generation of leaders. He points to Omnicom’s earlier Star One programme, which recruited young talent consistently and invested in their development.
“The investment in talent is not just money. It is time, mentoring and leadership attention,” he says.
Is AI a threat?
Karkare sees AI as a disruption that can make agencies more efficient rather than simply replace people. Tasks such as research and routine work can now be completed much faster.
However, he believes human experience remains critical. The accumulated understanding of clients, brands and markets cannot simply be replicated by technology.
The opportunity, therefore, lies in combining AI-led efficiency with human judgement, experience and creativity.
Is performance marketing overrated?
Karkare argues that performance and brand building cannot operate in isolation. Performance marketing can drive conversion, but sustained growth also requires creating brand preference.
“Performance marketing alone cannot build brands. You need to create preference at the top and performance at the bottom.
The right balance, he says, will vary by category, client, competition and market conditions.
Are agencies losing business influence?
For Karkare, the answer begins with how deeply an agency understands its client's business. Superficial understanding inevitably produces superficial solutions.
Agencies need to be genuinely invested in the client's business and demonstrate that they are thinking about the same fundamental outcome: profitable growth.
Will the traditional agency disappear?
Karkare does not believe communication or agencies are going away. The form will evolve as technology and media consumption change, just as the industry adapted through the arrival of television and digital.
What matters is the underlying need to create demand. How agencies deliver that value may change, but the need itself remains.
What needs to change next?
For Karkare, the industry needs a common view of media consumption and measurement. Without a unified understanding of how consumers move across platforms, advertisers will continue to face uncertainty around investment and outcomes.
Ultimately, he believes agencies need to shift the conversation from cost to value and make value creation their central obsession.
