The short answer
The biggest advertising holding companies are consolidating, centralising production and moving work to lower-cost hubs, often with AI tooling in between. For clients this means the people who pitched you may not be the people who make your work, and the team can change without anyone telling you. None of that is necessarily bad. Not knowing about it is.
If you buy creative, design or marketing services from anyone, large or small, the questions that matter now are who is on your account, where the work is done, and what happens when that changes.
What happened
Omnicom completed its $13.25 billion acquisition of Interpublic Group at the end of 2025, creating the largest agency holding company. In September 2026 its CFO told an investor conference that headcount would fall by about 15,000, from roughly 120,000 to 105,000 by the end of the year, as it pursues $1.5 billion in cost savings from the merger. The reduction includes layoffs, attrition, outsourcing and offshoring.
In the same period, PepsiCo moved its global media business, estimated at about $1.8 billion, to Publicis across more than 200 markets without a formal pitch, ending a relationship with Omnicom of more than 25 years. Omnicom's CFO said the loss "can't be sugarcoated". Omnicom reportedly keeps some PepsiCo PR, creative and sports work.
On r/advertising, the reaction was blunt. The most-discussed posts that month were first-person accounts from agency staff describing hiring freezes, internal IT and production being centralised, and work routed to offshore hubs while client-facing staff stayed onshore. These are individual accounts, not audited facts, but they describe the model clearly enough to be worth taking seriously.
What consolidation changes for clients
The logic of a holding company merger is to combine duplicate functions. For clients, that tends to show up in four ways.
- Centralised production. Design, artwork, video editing and build work move from individual agencies into shared production units serving many brands.
- Relocated delivery. Production shifts to hubs in lower-cost markets. The account team you meet stays where you are.
- AI platforms in the middle. Networks are investing heavily in internal AI tools. Some of what you receive will pass through them.
- Team churn. People leave, roles are merged, and institutional knowledge about your brand walks out with them.
The media side is different. Scale genuinely helps in media buying, which is why PepsiCo consolidated its media rather than fragmenting it. Consolidation is least helpful in work that depends on judgement and continuity: brand, creative, design and specialist production.
Offshoring is not the problem. Hiding it is.
We should be clear about where we stand. Kalex is a studio in New Delhi, and much of our work is for clients abroad. We think distributed teams can do excellent work, and we wrote a practical guide to hiring an overseas design team from the client's side.
What goes wrong in the accounts from inside the networks is not geography. It is work moved without the processes, context and senior people that made it good, often without the client being told. Questions that took minutes start taking days. Quality slips, and the people answering for it did not make the decisions. A client who chose a remote team knowingly, and can talk to the people doing the work, is in a completely different position from one who does not know where the work goes.
Network or independent: an honest comparison
| Factor | Holding company agency | Independent agency or studio |
|---|---|---|
| Media buying power | Strong | Limited, often partners with a media specialist |
| Global coverage | Many markets under one contract | Usually a few markets, or remote delivery |
| Senior attention | High at pitch, variable after | Founders and seniors usually do the work |
| Team stability | Exposed to restructuring | Exposed to key-person risk |
| Decision speed | Layers of approval | Fast |
| Capacity for very large programmes | High | Limited |
Independents have real risks of their own, mainly that a small team can be stretched or depend too much on one person. The point is not that one model is better. It is that each fails in a predictable way, and your contract should cover that failure.
Questions to ask any agency now
- Who, by name, will work on our account, and what percentage of their time?
- Where is each part of the work done? Strategy, design, production, development, QA.
- Is any work subcontracted or passed to another entity in your group?
- Which AI tools touch our work, and does our data leave your systems?
- What happens if the lead on our account leaves?
- Who owns the files, source code and accounts? Our ownership guide lists what to check.
Clauses worth adding to the contract
- Key personnel. Named people, with notice and your approval before replacement.
- Subcontracting consent. No work moved to a third party or another group company without written agreement.
- Delivery location disclosure. Not a ban, a statement of where work is done, updated when it changes.
- Data handling and AI use. Which tools, which data, and whether your material may be used for training.
- Transition assistance. Handover of files, access and documentation if either side ends the relationship.
Our contract checklist covers the rest. If you are reviewing an agency relationship after this month's news and want a second opinion on the creative or design side, talk to us. You will speak to the people who would do the work.