WPP’s CEO, Martin Sorrell, a name to reckon with in the marketing, advertising and communication business, and known for his sharp business acumen, has been quoted saying if all WPP markets were performing like India, he (Sorrell) could retire. In a conversation with
BW Businessworld, Sorrell says the advertising buisness is evolving and that around 75 per cent of WPP revenues are coming from streams that “Don Draper would not recognise”, implying the shift from traditional advertising to new forms. Excerpts:
Q. For a company such as WPP, the largest holding company globally, what will drive future growth?There are three key areas that help us differentiate our offer — technology, data and content. And an added metric to that is talent. In our direct competition, we are the only company that has invested in all these. As the business is changing, integration is coming in much broader areas than it used to. Apart from the broadening of the definition of creativity to include the likes of data and healthcare, clients increasingly are asking for more integration. They don’t want individual brands but the best people to handle their business. The model of the future, as we see it, will be in what we call ‘horizontality’, which is our ability to collaborate and work together for the benefit of our clients. We already have 45 teams of varying coordination for our top clients, and my objective is to grow this.
Q. In India, which specific businesses have done well for you this year?We are growing significantly across the board. Some of our businesses are doing better than others, but we are firing on all cylinders, be it creativity, media investment, data investment, digital, design, brand identity, PR or healthcare — for us, everything has grown, and hence contributed to overall growth. Our fracas on television audience measurement (TAM Media was replaced by industry body Broadcasting Audience Research Council) was perhaps the only concern but that too seems to be resolved.
Q. Does it concern you that despite all the expectations from digital in India, it still forms a very small portion of ad spend?When the world is growing slowly, growing the topline is critical. Given the sheer numbers India has on things such as smartphone penetration, there are bound to be certain expectations. I would guess that digital is perhaps 10-15 per cent of our revenue in India. For a country of over 900 million handsets, it should be much higher. That being said, the market is catching up. The legacy media in India has a much more entrenched position, still very fragmented but doing well. The digital world is becoming complex and it is difficult to ascertain what and where the right kind of spending is.
Q. You have been quoted on some of the issues with digital advertising, especially in context to ad fraud or bot advertising...That is an issue that needs to be addressed. This is one of the reasons we invested in ComScore and RenTrack. We know from media reports that Google underestimated the amount of viewing they had from bots, which is another case in point of you cannot taste your own cooking. Unilever has spoken about the three Vs — value, validation and viewability, and taken a big position, which we support, that the standards for viewability online should be as exacting as they are for offline.
Q. As the CEO of a holding company, what are the biggest challenges you see ahead?The opportunities are significant. The biggest challenge is to get clients to invest in brands when we all know that the only way you can grow in the long term and to create great value is by growing the topline. The animal spirit, as John Maynard Keynes would have said, is dull at the moment — we need to make it more expansive.
(This story was published in BW | Businessworld Issue Dated 30-11-2015)
