SORRELL: "THINGS WILL NOT GO BACK TO THE SAME AS BEFORE"
Posted: Sat Jan 18, 2025 4:52 am
WPP CEO Martin Sorrell said online advertising spending will account for 20% of budgets in 2014 as consumers will spend 30% of their time online within five years.
In an interview with the Wall Street Journal, Sorrell said he believes it is natural for there to be reluctance to change, but that this evolution is similar to those faced by the industry with 99 acres data regard to racial prejudices, which have been overcome in order to open up to the market.
Regarding the recovery, the director is pessimistic about the recovery of the advertising market and says that confidence has not yet reached the minds of consumers, who continue to not invest in brands for fear that the crisis could worsen.
For Sorrell, the recovery will begin in the emerging markets of China and India, where it could reach 7%, but the rest of the world, especially Europe and the United States, will have to be content with not having negative figures and that this will be an achievement.
"Our crisis is L-shaped, which means that things will not go back to the way they were before. The predictions for growth levels in advertising spending, in traditional media and not, will be quite anemic for 2 or 3 years," he estimated.
Sorrell admits that WPP has been optimistic for too long and has reacted too slowly. Initially, it was expecting a 2% decline, which was later corrected to 4% and then 8%. The main difficulty in this situation is to reduce costs in a reasonable way.
Sorrell says WPP spends about $9 billion a year on staff, “but we can’t cut staff as fast as sales are falling.” By the end of July this year, WPP had cut 7% of its jobs. Half-year figures showed gross profits down 50%.
In an interview with the Wall Street Journal, Sorrell said he believes it is natural for there to be reluctance to change, but that this evolution is similar to those faced by the industry with 99 acres data regard to racial prejudices, which have been overcome in order to open up to the market.
Regarding the recovery, the director is pessimistic about the recovery of the advertising market and says that confidence has not yet reached the minds of consumers, who continue to not invest in brands for fear that the crisis could worsen.
For Sorrell, the recovery will begin in the emerging markets of China and India, where it could reach 7%, but the rest of the world, especially Europe and the United States, will have to be content with not having negative figures and that this will be an achievement.
"Our crisis is L-shaped, which means that things will not go back to the way they were before. The predictions for growth levels in advertising spending, in traditional media and not, will be quite anemic for 2 or 3 years," he estimated.
Sorrell admits that WPP has been optimistic for too long and has reacted too slowly. Initially, it was expecting a 2% decline, which was later corrected to 4% and then 8%. The main difficulty in this situation is to reduce costs in a reasonable way.
Sorrell says WPP spends about $9 billion a year on staff, “but we can’t cut staff as fast as sales are falling.” By the end of July this year, WPP had cut 7% of its jobs. Half-year figures showed gross profits down 50%.