Sorrell Set to Steer WPP Away from Trad Ad Model

26 January 2009

LONDON: Sir Martin Sorrell (pictured) last week took pause from walking on water to share with lesser mortals his vision for the future of WPP Group.

Addressing an International Advertising Association lunch, he outlined plans to steer WPP toward a more strategic, insight-led approach to advertising. 

In justification he cited recent research from the Internet Advertising Bureau, which probed the reasons why clients value agencies and found that 87% of the sample favoured shops with "strategic consumer insight". 

WPP's new strategy also explains Sorrell's determination to press-gang Taylor Nelson Sofres into his ever-expanding research empire.

"Clients won't move in the future unless they get quantitative justification for what they do," he said. "We may not like it - creative departments of ad agencies certainly don't - but that's the way the world's going."

As to adland's prospects for the year ahead, Sorrell was downbeat about the prospects for western Europe. "I think it's going to be very tough for us here, and for France, Germany, Italy and Spain, unless there is significant political, social and structural change."

He was in less pontifical mode regarding the USA, declaring that  "the jury is out" on how America might perform under the trusteeship of President Obama.

Turning to the media sector, Sorrell warned that it continues to be "disintermediated" [Sorrell-speak for "split"] by low-cost business models. "The painful thing for old media is it will never be the same again," he said. "it will never be as profitable as it has been."

In evidence he pointed to the UK's receding ad market, which WPP's GroupM predicts will fall 5.8% in 2008 and 6% in 2009.  "ITV and Michael Grade continually say [TV airtime] is as cheap as it's ever been and impacts are up, so why aren't [advertisers] buying?"

According to the adland knight, WPP still hopes to achieve a flat year in 2009, thanks mainly to bullish market prospects in Asia, Latin America, Africa, Middle East and Central and Eastern Europe.

Data sourced from Media Week (UK) and BrandRepublic (UK); additional content by WARC staff