4. Risks associated with client portfolios
Description of the risk
Contracts may be challenged easily: clients are free to terminate their contracts after a relatively short notice period. In addition, unfavorable macro-economic conditions could lead to more frequent contract renegotiation.
Moreover, competitive bids for advertising and media contracts with the Groupe’s clients may occur at shorter intervals.
There is also a trend towards operating on a project-by-project basis, a gradual reduction in the number of agencies working with a client, and to a certain extent, the concentration of advertising budgets among a few leading agencies. Moreover, the in-housing of some activities may impact our ability to retain clients. Clients may also have to reduce or postpone their investments in digital transformation. These factors heighten the risk that a single event affecting a key client could have substantial repercussions.
A significant percentage of the Groupe’s revenue is derived from its major clients. In 2024, the Groupe’s top 5, 10, 30 and 100 clients accounted respectively for 13%, 22%, 38% and 59% of the Groupe’s consolidated revenue (see also Section 6.6 “Notes to the consolidated financial statements,” Note 30 “Risk management”).
One or several large clients may decide either to switch advertising and communication agencies, or to curtail their spending on advertising, or even suspend it, at any time, with relatively short notice, and without having to justify it. A substantial decline in the marketing transformation, advertising and communication spending of the largest clients, or the loss of any of these accounts, could have a negative impact on the Groupe.
Risk management
The Groupe adapts its offering and strives to anticipate and meet the marketing and digital transformation needs of its clients. In terms of offering, in addition to its historical activities in creativity, production and media, the Groupe has invested in digital activities, digital transformation, data and AI. The Groupe has also adapted its internal organization and has moved from a holding company to a platform. Publicis has also realigned its operations following a country model with shared services for better process and cost optimization. Clients, via Groupe Client Lead, can thus benefit from all of the Groupe’s expertise, and in particular the “Power of One,” which helps strengthen the talent collaboration to better meet their needs.
In addition, the Groupe retains a leading position in the New Business ranking.