Expanding the Identity Graph and Global Reach

Publicis Groupe’s acquisition of Lotame, announced on March 6, 2025, represents a strategic move to enhance the data capabilities of its platforms—Epsilon, APEX, PMX and Core AI—within an increasingly competitive and data-driven advertising landscape. This acquisition, part of a $1.5 billion investment spree over the past six months, integrates Lotame’s extensive data and identity solutions into Publicis’s existing infrastructure, amplifying its ability to deliver personalised, scalable marketing solutions. Below, we explore how this acquisition bolsters Publicis’s platforms, drawing on the specifics of the deal and its implications for each component.

Enhancing Epsilon

Epsilon, acquired by Publicis in 2019 for $4.4 billion, serves as the backbone of the group’s data-driven marketing efforts, managing an identity graph of 2.3 billion consumer profiles globally. Lotame, a leading independent data and identity solution provider, brings an additional 1.6 billion unique IDs, built on over 100 data sources across 109 countries. Once integrated—expected by Q2 2025 after data deduplication—this combination will expand Epsilon’s reach to nearly 4 billion profiles, covering approximately 91% of adult internet users worldwide.

This scale significantly strengthens Epsilon’s “identity spine,” a system for linking consumer identities across devices and touchpoints. Lotame’s expertise in probabilistic modeling enhances Epsilon’s ability to refine audience segmentation, particularly in a post-cookie environment where first-party data is paramount. For instance, Lotame’s data marketplace and Panorama ID—a cookieless alternative identifier—extend Epsilon’s capabilities beyond its U.S.-centric focus (where 97% of its revenue originates) into key growth markets like Asia-Pacific (APAC) and Europe, Middle East, and Africa (EMEA). This geographic expansion addresses a prior weakness, as Publicis executives have noted Lotame’s established presence in these regions as a critical factor.

Practically, this means Epsilon can offer clients more precise targeting and measurement. For example, consumer packaged goods (CPG) brands can leverage Lotame’s data to assess inflation-driven shifts in purchasing behavior—whether shoppers trade up to premium brands or down to value options—and adjust media strategies accordingly. Additionally, Lotame’s publisher relationships will enhance Epsilon’s first-party tagging system, aiding publishers in navigating cookie deprecation and expanding Publicis’s retail media network capabilities. By linking store-level data (e.g., stockouts or price changes) with consumer profiles, Epsilon can enable real-time bidding adjustments, a boon for retail media clients seeking immediate ROI.

Precision in Performance Marketing

Publicis’s performance marketing platforms, focuses on paid media, creative optimisation, and measurable outcomes, primarily excelling in bottom-funnel campaigns. While it lacks the full-funnel scope of Epsilon, the influx of Lotame’s data supercharges its precision. The expanded identity graph—nearing 4 billion profiles—provides richer, more granular consumer insights, enabling it to refine targeting for performance-driven campaigns.

Lotame’s probabilistic data workbench, which Publicis plans to deploy, offers transparency into AI-driven projections, allowing the ability to optimize media bids with greater accuracy. For instance, a retailer could use this data to target consumers likely to respond to a limited-time offer, adjusting bids based on real-time behavioural signals. This acquisition also strengthens retail media capabilities, as Lotame’s data can connect local inventory fluctuations to audience profiles, ensuring ads reach the right consumers at the right moment. While the enhanced data depth could elevate its role within Publicis’s ecosystem, particularly for clients prioritising ROI over brand-building.

Fueling AI-Driven Innovation

Core AI, Publicis’s artificial intelligence platform, received a $314 million investment in 2024 to integrate generative AI into audience creation, media planning, and creative workflows. CEO Arthur Sadoun has emphasised that “AI is nothing without the data,” and Lotame’s acquisition directly addresses this by providing a vast, high-quality dataset to power Core AI’s capabilities. With Lotame’s 1.6 billion IDs and 100+ data sources feeding into Epsilon’s infrastructure, Core AI gains access to a near-4-billion-profile identity graph, dramatically enhancing its ability to generate actionable insights.

This data infusion enables Core AI to refine probabilistic modeling, a key focus of the integration. For example, financial services clients could use Core AI to identify consumers likely to become high-net-worth individuals, while CPG advertisers could predict spending shifts amid economic changes. Lotame’s global coverage also supports Core AI’s application across diverse markets, strengthening Publicis’s claim of connecting clients to 91% of internet-using adults. Moreover, Publicis plans to deploy AI models within client-owned data environments, leveraging Lotame’s privacy-compliant framework to ensure compliance with regulations like GDPR. This approach not only mitigates privacy risks but also positions Core AI as a trusted tool for brands managing their own first-party data.

Core AI’s integration with Lotame’s assets also enhances its PESO (paid, earned, shared, owned) media ecosystem, connecting fragmented data points into a cohesive consumer view. This capability, highlighted by Chief Strategy Officer Carla Serrano as a shift from a “fragmented hypothesis” to a reality, allows Core AI to deliver personalised content at scale—critical as personalisation budgets rose 29% in 2024, per Deloitte. By training its 107,000 employees on Core AI by year-end, Publicis aims to operationalise these advancements across its client base, amplifying the platform’s impact.

Strategic for Publicis Groupe

The acquisition of Lotame, a company with 19 years of data expertise and relationships with over 4,000 brands and publishers, reinforces Publicis’s position in the “data wars” among holding companies. It counters competitors like Omnicom, whose Omni platform touts comprehensive data coverage, and the potential Omnicom-IPG merger, which could combine Omni with Acxiom’s 2.6 billion profiles. Publicis’s move—part of a broader $800–$900 million M&A plan for 2025—ensures it remains the largest advertising group by market cap, leveraging Lotame to differentiate itself through scale, precision, and AI innovation.

As Sadoun noted, “In the age of AI, the name of the game is connect or die.” Lotame’s integration ensures Publicis’s platforms are not only connected but primed to deliver measurable outcomes, from media optimisation to creative execution, in a privacy-first world.

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