• by Joe Mandese  @mp_joemandese, April 29, 2009

Madison Avenue is known for its ability to spin, and this morning, the head of one of the largest advertising groups in the world, Paris-based Publicis' Maurice Levy, spun some good results out of dismal first quarter earnings. Noting that the economy has deteriorated "much worse than anticipated," Levy boasted that Publicis increased its share of the global advertising services marketplace despite a 4.4% decline in its "organic" revenues during the first quarter of 2009. While its results were down vs. last year, Levy said they were better than analysts' estimates, and they beat the performance of the other major agency holding companies, which reported declines in first quarter organic revenue of between -5.8% and -6.6%.

"This shows clearly that we have won market share. This shows also very clearly that our strategy, which was to invest massively on digital, has been bearing fruit, and also that our footprint on emerging markets is protecting our growth," Levy said of Publicis, which is the parent of Digitas, Starcom MediaVest Group, Zenith Optimedia Group, and brand agencies like Leo Burnett and Saatchi & Saatchi.

Levy's digital parlay, including his $1.3 billion acquisition of Digitas in 2007, and deep investments in personnel, systems and resources do indeed appear to be paying off, and have led to something of a digital pissing match between him and his chief rival on the subject, WPP's Martin Sorrell.

"We are very pleased with our strategy in digital. Not only do we have an organic growth, which is close to 10%, and the total growth of our operation at constant exchange rate is 13.3%, so we are really very happy. It shows clearly that this was the right strategy, and we see more and more clients going digital," Levy said. "And by the way, as we know, the forecasts that have been delivered by Zenith Optimedia, as well as our competitors, show clearly that the analogue media will suffer a lot, and we expect this to last for a long period of time, while digital is still growing. And we believe that digital will grow at least by 8 to 10% in the next two years."

While Publicis did not offer any new guidance to investors for the balance of the year, it cited Zenith Optimedia's revised ad industry forecast, which calls for a decline in worldwide advertising spending of 6.9% "hurting analog media while digital continues to grow."

"These latest forecasts should be considered in the context of forecasts made at the end of last year, which estimated that advertising spending worldwide would show negative growth of -0.2%. These numbers reflect the unprecedented economic slowdown worldwide. Other market indicators, while slightly less negative, deliver the same message.