Despite posting bullish results for year 2000 [WAMN: 21-Feb-01], WPP Group has revealed that its budgets for the current fiscal are based on zero growth in global advertising revenues, as well as a net downturn in the US economy.
But seasoned WPP-watchers suspect that Sir Martin Sorrell, always adept at running with the hare while hunting with the hounds, is hedging his bets. The group’s statement stressed that WPP’s estimates were “highly conservative” and may be offset by its burgeoning marketing services operations – which could contribute towards a seven percent overall increase in revenues this year.
Observers also recall that at the outset of 2000, WPP budgeted for a 10% increase in revenues and eventually hit 15%. Likewise in 1999, 4% became 8%; while in 1998 6% blossomed into 8%.
But despite Sir Martin's habit of promising low and delivering high, WPP’s Cassandra-like utterings will do little to stop the ad industry from battening down the hatches in the face of dotcom failures, cutbacks in adspend and the expected slowdown in the USA – the globe’s largest advertising market.
News source: Financial Times