The news: Mergers and acquisitions (M&A) transactions in the marcom agency space were significantly down in 2024, falling 37% to 52 deals compared with 82 deals in 2023, per an analysis from benchmarking firm COMvergence.

Other key findings:

• 13,324 employees were acquired, similar to 2023 levels, but a decrease in average headcount per acquisition from 2023—indicating that buyers are making more strategic and targeted acquisitions rather than pursuing scale for its own sake.
• Accenture and Publicis Groupe led the pack. Accenture acquired Navisite and Logic, adding more than 1,500 employees and leading in revenue efficiency per acquisition. Publicis Groupe made seven deals, including Mars United Commerce. Stagwell Global also thrived, leading in volume with 10 acquisitions.
• Management consultancies only made 12 acquisitions in 2024, down from 2023.
• Outside of Publicis, several Big 6 holding companies saw slower activity in 2024. IPG made two deals, acquiring Intelligence Node in the US and Xiklab Digital in the Philippines. Omincom also made two deals, acquiring LeapPoint and Coffee & TV, while Dentsu and WPP each had one acquisition.
• North America remained the dominant region for acquisitions, a trend that has been ongoing since 2016. North America contributed nearly 59% of global revenues.

Will M&A increase in 2025? Despite initial expectations that M&A activity would recover under President Donald Trump’s administration and following the removal of Lina Khan as FTC chair, ongoing economic upheaval has brought deals to a halt.

• Fluctuating tariff policies have caused mass uncertainty, making it difficult for buyers and sellers to correctly assess valuations and potential risks—which could lead to fewer deals.
• Mass government layoffs have exacerbated this uncertainty, contributing to reduced public spending.
• As a result, consumer confidence is hitting new lows, and companies are increasingly focusing on shoring up their businesses by shedding underperforming assets over pursuing new, potentially volatile deals.

Our take: Despite the current slowdowns, M&A activity will eventually rebound—and agencies must position themselves advantageously for when this happens.

• Focusing on fundamentals is key. During lulls, the most attractive future targets are the agencies that maintain consistent financial health, invest in talent development, and deepen strategic client relationships.
• Value demonstration will become increasingly critical. Clients will closely scrutinize marketing spend more intensely during uncertain periods, so agencies must clearly articulate ROI.
• Adaptation and a forward-looking approach may prove valuable. Brands can explore alternative partnership models through strategic alliances and joint ventures in place of full acquisitions to continue expanding. Agencies heavily exposed to sectors that will be most affected by economic uncertainty should expand by diversifying their client base.