Social network giant, Facebook Inc (NASDAQ:FB) entered a multi-year marketing agreement with Publicis Groupe S.A. (ADR) (OTCMKTS:PUBGY), the third largest advertising holding company.
The terms of the agreement were not disclosed, but a report from Ad Age indicated that the marketing deal is worth approximately $500 million based on information from an executive familiar with the matter.
Laura Desmond, chief executive officer of Starcom MediaVest Group that led the negotiations between Facebook Inc (NASDAQ:FB) and Publicis Groupe S.A. (ADR) (OTCMKTS:PUBGY) said the multi-year partnership is “focused on co-creation of product around data, video and images” including Instagram, the mobile-photo sharing app of the social network giant. At present, the partnership is concentrated on North America, but the companies plan to discuss global expansion “down the road.”
According to Ad Age, the third largest advertising holding company agreed to integrate its media-mix-modelling platform with the social network’s data. The integration allows Publicis Groupe S.A. (ADR) (OTCMKTS:PUBGY) to see the performance of advertisements on Facebook Inc (NASDAQ:FB) advertising network. Publicis will also have access to the social network giant’s engineers and other resources to help create special advertising units that will appear on Instagram.
Carolyn Everson, vice president of global marketing solutions at Facebook Inc (NASDAQ:FB) said, “When you look at the composition of the entire partnership, there are aspects benefiting Publicis, whether it’s a first look and a competitive advantage of moving quickly on some of these elements. This is the first time we have all of the different elements that will allow clients to reach a significant scale of 100 million people a day in the U.S. and [specific] audiences within the 100 million the client wants to reach.”
A related report from Reuters also quoted a statement from Facebook Inc (NASDAQ”FB), which stated that its partnership with Publicis Groupe S.A. (ADR) (OTCMKTS:PUBGY) will center of bringing clients closer to its products, and creating new planning and measurement tools to make buying easier, more efficient, and ultimately prove out ROI (return on investment).
Earlier this month, Publicis Groupe S.A. (ADR) (OTCMKTS:PUBGY) and Omnicom Group Inc. (NYSE:OMC) mutually abandoned their proposed $35 billion merger of equals agreement due to difficulties in completing the transaction within a reasonable time frame, which created uncertainty harmful to the interests of the shareholders, clients and employees of both advertising companies.
