Ascential, parent company of the Festival of Cannes creativity and the omnipresent consulting company MediaLink, announced a decline in total revenues generated by its marketing division – which includes these two organizations – in the 2018 annual results of today.
The shares of the London-based company had declined by about 2% at the time of filing this story.
The This decline was not unexpected given the " major restructuring of Cannes " revealed by Ascential in November 2017, as a result of pressure from the major oil companies. portfolio of agencies that demanded a shorter, more streamlined and more profitable event.
Publicis Groupe made the headlines of the press by announcing, at the very beginning of the 2017 festival, that he would ban his agencies from submitting work to ards shows for the next year in order to be able to focus on the development of AI-based internal platform, Marcel (Despite this very public statement, "it's a tide" of Saatchi & Saatchi "always" dominated "in Cannes in 2018. Publicis also told Adweek that his placements in a jury were not contradictory this promise.)
" He It is clear that our marketing segment faced a tougher year in a difficult market in 2018. However, we are pleased to note that the restructuring and restructuring of the Cannes Lions' awards have worked well with customers, which has led to allowed to get his highest score NPS [net promoter]"said Duncan Painter, CEO of Ascential.
Bring the marketing segment back to growth this year. "
Duncan Painter, CEO of Ascential
The overall organic growth of the company grew by 6.3% year on year and 3.8% adjusted to account for EBITDA: But marketing recorded a $ 12 million decline in organic growth in sales, with a decline of 8% in Cannes and 9% in MediaLink.
Part of this trend can be attributed to the fact that the participation of Cannes Lions submission rates decreased by about 20-25% according to several sources who spoke to Adweek at the festival of last summer.
"Last year, we made significant changes to the festival continue to provide the creative benchmark for the sector we serve," said Painter. "We knew these changes, such as the rationalization of reward categories, have reduced revenues in the short term, and that's what we're seeing in this year's results. However, we can also see in these results how an increase in recurring revenue at Cannes Lions – from our digital products and services and consulting – partly offset this in the second half. "
" And, of course, we look forward to Publicis returning to the festival this year, "he added.
The complete results of Ascential, presented below, also report several other changes regarding the marketing component of the company, such as the acquisition of business information. the WARC group and the Amazon Flywheel Digital consulting firm, the introduction of the Cannes The Work digital archive and a greater focus on brands among MediaLink's customer list.
Comparing the Proforma Proforma EBITDA 2017 results with those of last year, the report indicates that many of these recent acquisitions "had margins below the Ascential average", which who may have played a role in determining these numbers.
Ascential's largest source of revenue is sales, which include Flywheel as well as the Edge by Ascential e-commerce service and the Money 20/20 financial technology brand. Marketing occupies a close second place.
"We are absolutely focused on returning to the growth of the marketing segment this year," said Painter. "We are delighted that MediaLink is making good progress in refocusing on its branded customers. In addition to the solid provision of basic products and services, new initiatives such as CLX, the new summit organized by Cannes Lions and MediaLink, designed around interactive and immersive experiences with some of the most exciting media and entertainment creators in the world, are essential to achieve this. arrive. "
A MediaLink spokesperson referred to Ascential for comment.
The complete results for 2018 are incorporated below.