Ipsos says Synovate will help meet new needs of clients
FRANCE— Ipsos offers a bleak outlook for developed market economies in its half-year results, warning of rising taxes and depressed consumer demand in the debt-laden countries of western Europe and the United States. So as clients look to emerging economies for growth, so does Ipsos – helped by its planned acquisition of Synovate.
To meet the new needs of clients, Ipsos says, it needs to improve its geographical coverage – in Asia, for instance – and “to grow in order to have greater resources and become more efficient”.
From a cost-savings perspective, Ipsos says benefits of the Synovate deal would come from global negotiations with suppliers, pooling of production centres and insourcing, consolidation of online panels, communication, IT and other organisational and operational efficiencies achievable over a larger revenue base.
The acquisition is still to be approved by shareholders of Aegis, Synovate’s parent company, but over the next few months Ipsos says it will be working on merger plans with teams from both companies. The end results should be the creation of the third largest research group in the world, with a staff of roughly 16,000 people.
Aside from the Synovate news, Ipsos has reported a strong first-half performance with revenue up 5.6% to €558.2m. Organic growth was 6.3%.
Emerging markets reported sales up 14.2%, compared to 3.1% in developed markets – not helped by “very specific and temporary phenomena” in Japan where sales fell by 23%, and in the UK where revenues were down 15% due to public sector budget cuts (although the firm is expecting a better second half).
Globally, opinion and social research was down 7.8% to €61.3m, marketing research up 4.7% to €253.6m, advertising research up 3% to €121.7m and CRM research up 15.4% to €59.3m. Media research was the star performer, with sales up 23.1% to €62.3m.
Operating profit was €46.9m, an increase of 8.9%.