Leila Abboud is a Bloomberg Gadfly columnist covering technology. She previously worked for Reuters and the Wall Street Journal.

Maurice Levy's interest in taking control of Samsung's $1.9 billion ad agency is certainly one way of cozying up to a client.

Levy's Publicis is having a tough time keeping hold of accounts, which may explain the enthusiasm for exploring new avenues. Even if the debonair CEO pulls it off, the deal is unlikely to solve all the French ad group's problems.

Since the failure of his tie-up with Omnicom of the U.S. in 2014, Publicis has lost market share and grown more slowly than rivals, as the chart below shows.

Slow Growing
Publicis has consistently trailed its rivals on organic sales growth
Bloomberg Intelligence

In a $30 billion frenzy of U.S. media buying account reviews last year, dubbed "Mediapalooza", Publicis managed to hold on to accounts such as cosmetics company Coty and Citigroup, but finished the year with painful losses at Procter & Gamble and L'Oreal.

A potential deal to buy 30 percent of Cheil Worldwide, reported by Bloomberg News, looks like a defensive move to forge stronger ties with Samsung, since the electronics maker is the biggest shareholder of the Seoul-based agency.

Samsung is the largest single-brand advertiser in the world, spending as much as $14 billion a year to market everything from smartphones to home appliances. Publicis already does a lot of work for Samsung as its lead media buying and digital agency. In late 2014, Levy himself flew to Seoul to help retain the contract in a review process that was seen as a test of his mettle after the failed Omnicom deal.

The Cheil deal could also help Publicis strengthen in Asia, which only accounts for about 11 percent of its sales. Kepler Research estimates about 30 percent of Cheil's revenue comes from China, where Publicis has been buying up smaller targets but still trails competitor WPP, which moved into the market earlier.

Nevertheless, buying control of Cheil wouldn't solve the broader problem about client retention. There probably aren't too many other customers with an ad agency handily attached. Publicis's biggest perceived weakness is maintaining its commercial relations in a rapidly changing market where big advertisers obsess about slashing costs.

Big brands are increasingly going directly to TV companies and web giants such as Facebook to place ads. Since ad agencies make most of their profit from buying and placing ads and not in designing campaigns, the shift is existential for them.

Levy is aware of the challenge. In December he announced a revamp of the company's structure and created "Chief Client Officers" to respond to the big brands' desire to have one point of contact with Publicis instead of dealing with its myriad agencies, from Starcom to Saatchi & Saatchi.

Competitors WPP and Havas have led the way on this kind of change. The contracts Publicis lost last year were in part a punishment for its poor response.

Publicis still has to defend a contract with 21st Century Fox, which spends some $1.6 billion buying ads in the U.S., and it's also competing to win business at Sony (an account now led by Interpublic) and Volkswagen (held by WPP).

Ad Nausea
Publicis shares have done worse than rivals since Omnicom deal collapsed in 2014

The French company certainly needs some good news. Its shares trade at a 20 percent discount to peers including Omnicom and WPP on a price to earnings basis. Revenue growth is expected to flatline in 2016-2017, and margins to suffer because of the $3.7 billion acquisition of digital agency Sapient and the drag from the account losses.

Binding yourself more closely to a high-spending behemoth like Samsung certainly has attractions. But landing a big fish like Sony or VW in the more time-honored fashion -- perhaps over a martini -- would say far more about the health of the business.

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

To contact the author of this story:
Leila Abboud in Paris at

To contact the editor responsible for this story:
James Boxell at