Here’s a turn-up: is Publicis on the right track while WPP has been losing its way?

WPP and its boss Sir Martin Sorrell had their worst day for decades yesterday; reporting dire sales growth even though profits rose yet again, chiefly due to the weak British pound.

In a presentation to analysts Sorrell (below) pointed to numerous factors – some analysts reckoned 22 in all – behind the disappointment: everything from geopolitical uncertainty to a forthcoming pow-wow of the Chinese communist party.


Buch such factors are a fact of life for big companies: always have been, always will be.

Sorrell’s solution, in so far as he had one, was to double down on digital and so-called horizontality; bespoke teams of WPP people for big clients.

But this has been happening, supposedly, for years now. And the structure of the marcoms behemoth has barely changed.

Publicis Groupe, which has also had its woes recently, has at least changed its shape, creating four operating units: Communications, Media, Healthcare and Publicis:Sapient, its consultancy arm.

This reorganisation, the work originally of former CEO Maurice Levy (still at the company as eminence grise to new CEO Arthur Sadoun) at least gives the French-owned giant a clear reporting structure and the ability to downsize rapidly should it need to.

It’s instructive that, at the same time as WPP’s half-year results pinged into the inbox, so did the news that it had bought Design Bridge. Design Bridge is doubtless an excellent company but it’s yet another brand to add to a WPP collection that runs into thousands.

The ad world is changing as companies like Google and Facebook, the world’s biggest digital media owners, sidestep the need for agencies to deliver media bookings. The big consultancies can cherry pick the creative resources they need: boutique agencies or individuals.

Advertisers reckon the big agency groups have been leading them by the nose for years; placing their media money anywhere that suits the agencies and over-charging for creative. Who needs big research operations like WPP’s Kantar any more when companies like Adobe can say, pretty convincingly, they can do it all?

So Sorrell still has work to do if he’s to reverse the slide in WPP’s fortunes, not least the share price slump – down 22 per cent this year.

Asking him to look over the Channel at his much-derided French rival is probably asking too much. But some big changes are needed if WPP is to adapt successfully to a new world.

You May Also Like

featured publics groupe WPP

About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.
218 Shares
Share
Tweet
+1
Share
© Copyright 2013 More About Advertising, All Rights Reserved. With help of WPWarfare.com. | Cookies explained.