Is WPP’s Sorrell backtracking on drive to digital?

98F4421A-FB5F-D285-FFD8B3A02F6B719AWPP’s Sir Martin Sorrell (left) may have headed to Greece for his hols but he’s still supplying the world’s media with his opinions.

In an interview with Aussie site Mumbrella he suggests that Omnicom had emerged the stronger over Publicis Groupe following the failed mega-merger. This we know – judging from recently reported figures – but the reasons he gives are intriguing.

“What’s interesting post-POG – the merger that died – is that Omnicom has emerged much better from it that Publicis. Omnicom, particularly BBDO but not DDB or TBWA, have made a better recovery than Publicis.

“Publicis Groupe agencies are going through tough times because management has been stressing the importance of digital, but they have a legacy in traditional areas that is being undercut.

“If you stress digital, you’re in danger of devaluing the traditional side of the business. If your business is both traditional and digital, you stress digital at your peril,” he said, pointing out the danger of concentrating on “stuff that didn’t generate profit.”

This may well be true of Publicis – old Sorrell foe Maurice Levy said earlier this year that he wanted PG to become “an internet company.” But it can also be pointed back at Sorrell – who has spent a fortune on small digital agencies all over the world – and some big ones like AKQA – while stressing his ambition for digital to take an ever-larger slice of the WPP cake.

And, some might say, he has neglected his big agency brands to a degree too although that policy seems to be being reversed with Ogilvy proving a global powerhouse and Grey moving ahead strongly. Even venerable JWT, shortly to return to its roots as J. Walter Thompson, finally seems to be receiving some TLC.

Well, as that other great economist JM Keynes is supposed to have remarked, “I change my mind when the facts change.” And the facts are that digital remains under ferocious margin pressure, not least because it’s not just agencies that do it, whereas the likes of Ogilvy for WPP and BBDO for Omnicom bring in the billings and the profit. Because – to date, at least – the likes of Google and Facebook – don’t compete for ‘traditional’ ad accounts.

But it’s good that SMS is finally seeing the light. Or is he just putting the boot into Publicis?

Back to top button