Media agencies are facing the uncertainty of a Trump-2.0 presidency and the rise in agentic AI by 2025

Michael Burgi

10 January 2025

Ivy Liu This article is part a series exploring the trends in media, marketing and media buying for 2025. More from the series:

2025 will be a year to fasten your seatbelt.

The new (but not so new) president is known for shaking up norms. A deregulatory climate is expected, but one which discourages prosocial initiatives. Generative AI is adapting to each new version and becoming more powerful.

What’s next for the world of media agencies? It would seem that there is a lot to look forward to. One thing is that the news in mid-December that Omnicom was acquiring Interpublic Group led observers and analysts to believe it would set off a wave among other agency holding companies โ€“ at least the majority of them. Scenarios typically involve WPP which was the largest global holding company, or Havas which just spun off from parent Vivendi making it a more attractive acquisition target.

A board member of a holding firm, who declined to be identified to speak freely, said that there is a good chance that the next wave will involve private equity. The board member mentioned Apollo Holdings and Carlyle Group. The executive said, “I would expect private equity to join forces with [another holding company],” in all honesty. “If you want to remain independent, then you would have to be a consolidator for the next tier assets.”

I personally doubt it – that’s number 1. I personally doubt it — that’s No. “3 and 4 [which is Omnicom and IPG],” continued the board member. What do they do?” They probably do some shopping, if that’s what you want to call it, and look at Dentsu or Havas more closely. I think that tier will be bought.”

Stagwell’s CEO Mark Penn is clear about what size he believes to be right. Penn told Digiday that he had always believed the ideal size for the marketing industry would be closer to $5 or $6 billion. We are $2.5 billion, and growing.

Could Omnicom and IPG still be in trouble despite the market-friendly Trump Administration? Rep. Jim Jordan, R-Ohio, a Trump acolyte who chairs the House Judiciary Committee expressed his concern about Omnicom and IPGโ€™s participation in the Global Alliance for Responsible Media. He was instrumental in shutting it down, despite the groupโ€™s efforts to promote brand protection, because he claimed that the body was politically biased. It remains to be determined whether this is a credible threat against the acquisition. Jordan’s complaints were not addressed by an Omnicom representative.

It is widely expected that this second iteration Trump’s administration will also favor deregulation. This includes a more relaxed approach to generative AI. This is largely due to Elon Musk’s massive AI ambitions through X and Grok, which has had a huge influence on the president elect. The ability of AI to save time, free resources, and make connections within vast pools of data is a factor that agencies should expect to continue investing in. Perplexity’s and Microsoft’s Copilot are making inroads into the search giant Google, which is also innovating. Agentic AI is a growing field that has impacted the general search and purchasing behavior. Media agencies are trying to understand it.

However, Alison Pepper, the evp for government relations and sustainability with the 4As, said that it is not all smooth sailing. “When I speak with agencies, copyright is a big issue. “Copyright is important when creating assets for clients,” Pepper said. “They also care a lot about transparency — they want to know what their AI provider does, so that it doesn’t expose them to liability.” Steve Boehler of Mercer Island Group, a media consultancy, says it’s a matter almost of survival. Boehler said that agencies are “gung ho” [about AI] regardless. “The big agencies have the capital they need to reinvent themselves in order to survive. AI will allow smaller agencies to reinvent themselves with the many tools and capabilities available on the open market. AI will change the world, but not in a cataclysmic way.”

For Boehler the greater concern is the uncertainty that lingers over the agency industry and the wider economy in this Trump 2.0 era. He said that AI and consolidation would make the next four years fascinating. “In a surprising way, this new administration adds uncertainty, which is not what you would expect of an [incumbency]When a new president is elected, you usually know what they are going to do.

So everyone should buckle up.

https://digiday.com/?p=564316

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