British marketing giant WPP overtook long-time rival Omnicom for the first time in 2008 to become the world's biggest marketing group, as well as the most profitable. It has remained the biggest ever since, with gross revenues reaching a record high, in USD at least, of $20.8bn in 2018, helped by the weak pound. Whereas some rivals, like Omnicom and Interpublic, have largely avoided large acquisitions in the 21st century, WPP continued steadily to expand its portfolio in the 2000s, reinforcing Sorrell's reputation as arguably the industry's most skilled dealmaker. Among the more significant recent additions to the collection were digital advertising network 24/7 Real Media in 2007; global research group TNS, acquired during 2008 after a long and sometimes bitter siege; and top German marketing group Commarco, snapped up in 2011. The group's last $500m-plus acquisition was AKQA in 2012, but it has continued to hoover up smaller businesses around the globe. However, a sharp downturn in profitability in 2017 was followed in early 2018 by an allegation that WPP's creator and CEO Sir Martin Sorrell had misused corporate assets, a charge he strenuously denied. With WPP's share price in freefall, Sorrell stunned the global advertising community by resigning from the group he had assembled almost single-handedly over the space of 33 years to launch a new venture, S4 Capital. His successor Mark Read has been struggling since then to turn around the group's weakening performance, partly by consolidating WPP's diverse collection of assets. Other investments and operating businesses were sold, including the controlling stake in global research group Kantar. His most radical move was to merge the ailing J Walter Thompson and Y&R networks with stronger sister agencies. WPP still owns four of the world's largest advertising networks; now Wunderman Thompsonand VMLY&R as well as Ogilvy and Grey. They are partnered in turn by three global media networks Mindshare, Mediacom and Wavemaker, under the overall banner of GroupM. WPP also controls a substantial portfolio of PR, CRM, design, consultancy and diversified marketing subsidiaries.
Who are the competitors of WPP? See ranking of Leading Global Marketing Groups
WPP's quarterly like-for-like growth since 2016
See chart (subscribers only)
Who are the clients of WPP? See individual agency profiles below for more
Subscribers only: Adbrands profile
Recent stories from Adbrands Update:
Adbrands Daily Update 27th May 2020: Weeks after its peers, Dentsu finally published financial results for 1Q. With all results now in, surprise leader of the pack for 1Q was MDC Partners at 2.0%, while Omnicom and Interpublic both weighed in at 0.3%. Dentsu came next at -0.8%, followed by Publicis at -2.9% and WPP and Havas both on -3.3%.
Adbrands Daily Update 29th Apr 2020: The impact of Coronavirus on WPP was broadly in line with European counterparts. WPP reported a LFL decline of -3.3% in revenues less pass-through costs in 1Q. That's a little worse than Publicis and the same as Havas. All reporting regions reported declines. In terms of the group's Top Five markets, India was the only gainer, up 6.0% LFL. The US was down -1.9%, UK and Germany down -4.2% and -4.3% respectively, and China plunged -21.3%. France, Brazil and especially Italy were badly damaged, but Spain actually reported 3.8% LFL growth. Reported revenues less PT costs were £2.9bn, down almost 19% as a result of exchange rates and disposals.
Adbrands Daily Update 16th Mar 2020: WPP issued an all-staff memo on Saturday asking more than 100,000 employees to work from home "wherever possible". Although all offices will remain nominally open, unless otherwise ordered by each country's government, WPP said it "will take action to greatly reduce the density of people in our buildings and the amount of travel to and from work." Omnicom followed suit, moving to an official work-from-home policy from this week. In a memo to all employees, CEO John Wren said "We are asking for the support of our agency leaders to make certain our people work remotely and only essential staff go into the office. If you have not done so already, please ensure in the next day or so that you collect what you need to work from home."
Adbrands Daily Update 2nd Mar 2020: WPP has launched a new strategic marketing agency under the name WPP Black Ops. The unit is loosely aligned with Grey and Mediacom, but operates separately as a "fluid operation situated in key global hubs". Founding client is P&G's high-end skincare brand SK-II, but talks are ongoing with additional clients in several markets. According to unit leader Nihar Das, also managing partner of Mediacom APAC, "What started out as an experimental working model for one client escalated into a new proposition with wide relevance and appeal that's all about flexibility – drawing in the right people and structuring on a bespoke, project-by-project basis." Grey London strategy consultant Danni Mohammed is also part of the senior team and creative duties are overseen by Grey London ECD Leo Savage.
Adbrands Daily Update 28th Feb 2020: With all results now in, Omnicom led the pack for 4Q with organic growth of 3.5%, followed by Interpublic at 2.9%. Everyone else was in negative territory: Dentsu -1.1%, MDC Partners at -1.5%, WPP on -1.6%, Havas -2.0% and Publicis on a grim -4.5%.
Adbrands Daily Update 27th Feb 2020: WPP's 4Q and full year results weren't great, but they were better than many feared, especially after disappointing numbers from WPP AUNZ earlier in the week. The group recorded another organic decline in the final quarter after modest growth in Q3, but -1.6% (including Kantar) put WPP in the middle of the pack compared to its peers, better than Publicis and Havas but worse that Omnicom and Interpublic and Dentsu. WPP's full year organic decline was -1.2%. The key markets of the US and China remain a serious problem. WPP didn't declare market-by-market organic performance for 4Q, but both - and especially China - appear to have performed much worse in Q4 than Q3. For the year as a whole, revenues less pass-through costs came in at £10.8bn. Net profit plunged by 37% to £718m. "Our clients and our people tell us that WPP has a clear new sense of purpose and is successfully instilling a culture of creativity, collaboration and openness," said CEO Mark Read. "I am optimistic about the future of our industry and WPP's position within it, although there is still much more work to do."
All rights reserved © Mind Advertising Ltd 1998-2020