PERSPECTIVE: D'Arcy's loss of Mars leaves Publicis with merger conundrum

Maurice Levy might deny it until he's blue in the face but D'Arcy losing Mars globally offers those who like that sort of thing an opportunity for speculation on D'Arcy merging with fellow Publicis Groupe and Procter & Gamble network, Leo Burnett. Mars, you see, was the most significant conflict between the two networks.

According to these people, Publicis is busy weighing up the strengths and weaknesses of its principal brands: Publicis, Saatchi & Saatchi, Leo Burnett, D'Arcy and Bartle Bogle Hegarty, and, on the media side, Zenith, Optimedia, Starcom and MediaVest.

As far as advertising goes, it's easy to rule out some parties from the merger debate. BBH is not only a Unilever agency within a P&G-dominated group, it is also cushioned by its clever 49 per cent ownership clause protecting it from any forced mergers in the event of a change of ownership.

Saatchis is performing more strongly than D'Arcy and Burnett, and has enough conflicts to keep it separate. Ditto Publicis. So the strongest signals point to a Burnett-D'Arcy marriage.

The main motivation behind such a union is the idea that unless you are a big advertising network with many global clients, you may as well forget it. Most people shake their heads in wonderment when asked to consider D'Arcy in these terms. They talk about Fiat and P&G, but what else? They mention D'Arcy's strength in America, its Italian office as a powerhouse agency, its UK reel being stronger than ever (ironically with the Mars' Maltesers ads as one of its highlights).

But D'Arcy versus the might of a BBDO, Ogilvy or McCann? Well, it's easy to poke fun. This, after all, is a network that has been driven more than any other in recent years by the desire of its largest shareholders and outgoing senior managers (they are one and the same) to cash in.

While D'Arcy's new senior management team has set out its priorities pretty clearly, John Farrell, Susan Gianinno and Lee Garfinkel are trying to do something that is very hard to pull off when you have just lost your third-largest global client - to raise margins and improve creative standards while competing against rivals who offer better geographical spread, are better at consolidating accounts, better at pitching for new accounts, better at stealing accounts held by other global agencies and more creatively renowned to boot.

But should we be reaching for the safety pins and the sewing thread just yet? I'd suggest not. Recent history has proved that Levy is no fan of mergers. Of the various major advertising brands he has bought, none have been merged. All evidence points to the rationale for a piecemeal, region by region, merger of the two brands. In Eastern Europe and some smaller markets, it's already happened. But merge two such powerful brands in their home US markets or, for that matter, in the UK? I doubt it.