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The US advertising and marketing services industry includes about 37,000 companies with combined annual revenue of about $88 billion. Major companies include Interpublic, Omnicom, Valassis Communications, and the US operations of Publicis and WPP. The industry is fragmented: the top 50 companies generate about one-third of revenue.
The global advertising and marketing industry generates about $390 billion in revenue, according to Magna. The US is the largest ad market, accounting for about a third of total worldwide advertising, followed by Japan, Germany, and China. Large companies headquartered outside the US include WPP (Ireland), Publicis (France), Dentsu (Japan), and Hakuhodo DY Holdings (Japan).
COMPETITIVE LANDSCAPE
Demand for advertising and marketing services comes largely from businesses that sell consumer products, entertainment, financial services, technology, and telecommunications. The profitability of individual companies depends on creative skills and maintaining client relationships. Large companies benefit from being able to serve the varied needs of major customers. Small companies can compete by focusing on niche markets or by offering lower pricing.
New competition for advertising and marketing business has come from database marketing companies, systems integrators, and telemarketers.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major services are advertising for print, broadcast, and online media (25 percent of industry sales), direct mail advertising (15 percent), and public relations (10 percent). Other services include display advertising, media buying (reselling advertising time or space), and media representation (selling advertising time or space on behalf of media outlet owners).
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