WPP CEO: Never say never on consultants buying holding groups
WPP chief executive Mark Read admits big ad firms and management consultants are increasingly going head-to-head – and doesn’t rule out a holding group being swallowed up entirely (Wall Street Journal).
Key points
- “Consulting firms and agencies will increasingly compete. Marketing is a creative and technology problem and clients need both” – WPP CEO, Mark Read
- On management consultants buying holding groups: “I’d never says never”
- Says privacy regulations have handed more power to Facebook and Google because of first party data relationship. “That’s the irony. They were designed to rebalance power, but [have] actually worked the other way”
- Says marketers will need to find new ways to measure, optimise and target in face of new privacy rules
- But not all bad: “A lot of clients also feel like theyʼve targeted too narrowly on Facebook, so to some extent going back to broader metrics is better”
Mark Read’s words will do little to dampen rumours of a swoop for WPP by one of the big four beancounters. Stating that “clients need both” of their skill sets implies that it is a logical move, while WPP’s recent divestments, or “tidying up”, as Read calls it, add further grist to the mill.
There were a bunch of interesting nuggets in a wide-ranging interview: In-housing isn't hurting WPP's bottom line; slow growth is not the new normal for holding companies; and perhaps precision targeting was too narrow after all. Read also offered a different take on Amazon's impact on retail and brand clients, and the drums beating louder for a big tech takedown.
While much is made of Amazon’s rise to primacy, Read said not one of his retail or brand clients consider Amazon a “major issue”. As they mull direct-to-consumer approaches, Amazon can be an opportunity, he suggested. Meanwhile, retailers looking to ape Amazon’s ad business, such as Walmart and Target, “will be important platforms”, he said, though perhaps not as large as Amazon will become.
Read also thinks talk of breaking up big tech is just that, but FANGs will come under further scrutiny now the ball is rolling. Proactively taking more responsibility for what happens on their platforms would help them, he suggests, while failure to do so might start to crimp ad dollars.
