Noorings: Status WPP- Blood in the water
Love him or hate him, Sorrell could not be ignored. It is true that WPP is hurt, but it also true that there is no Martin Sorrell around to lead an attack on it. An assault could come, and it could be from the newer players on the block like the consultancies, or maybe even the Amazons of the world.
Sir Martin Sorrell’s abrupt good-bye, the reasons of his forced exit, the pressure that the agency world, notably visible in WPP’s lackluster performance in the last year, or the continued drop in the company stock, more so after his resignation without a clear succession plan in place, have all led to one situation – the world’s largest holding company is hurt, and the industry can smell blood in the water.
In the midst of the career obituaries and eulogies being written for Sorrell, the one question that looms large is what next for WPP, and given its scale and size, what next for advertising itself.
And like every story, this story has two sides.
On the one side, the troubles are clear and present, and they had begun long before WPP initiated its investigation against Sorrell.
Advertising’s Poster Boy
For some time now, while Sorrell’s views may not have been agreed with, he was the poster boy of the agency world. He was relentlessly defending the advertising business model (run by holding companies that he engineered to take their present shape and form) and the need for agencies to exist. Large spenders have been challenging this structure, especially as they look to cut down and streamline their spending.
Recall the brilliant ‘It’s a #TideAd’ commercial during Superbowl 2018? That was a result of P&G experimenting and turning the agency model on its head, with a ‘people first’ approach. It brought talent from competing holding groups under one roof. Creative professionals from rival agencies including Saatchi & Saatchi, Grey, Hearts & Science and Marina Maher Communications worked together as one unit for P&G to enhance its creative product.
This was P&G’s answer to a year-long industry cry to reinvent the advertising model, in a world where digital dropped something new every day and consultancies have been on the rise. And nothing is stopping other marketers to follow suit.
Change in the natural order had most certainly begun; Sorrell’s exit will be a trigger to speed up the pace of this change. His handbook has been incredibly successful for more than three decades. No one was hence in any particular hurry to change it just yet, but it was also becoming old. His exit changes this mindset.
Those who say that Sorrell’s resignation is the end of an era or that ad land will no longer be the same, reiterate the influence that he commanded in the ad world. In an Omnicom earnings call earlier this week, the holding company’s CEO, John Wren said, “In many ways, I have a great deal of respect for Martin. I've competed against him for the last 25 years and very honourably.”
Love him or hate him, Sorrell could not be ignored. He was the best brand ambassador WPP could have asked for. One of the biggest reasons for that was his ability to micromanage efficiently, which in turn made him a darling of the press and marketers in India.
The Micromanager Advantage
People like me have grown up listening to Sorrell stories and what he was capable of. Nearly a decade ago, in a WPP party hosted during Sorrell’s India visit, attended by WPP agencies and their clients, one of the agency chiefs and a CMO were in deep discussion on business challenges. The CMO in question, recounted later, that in the middle of this conversation, someone tapped him on the shoulder and handed him a business card that read ‘Martin Sorrell, CEO, WPP’. Introducing himself, Sorrell said to the CMO, “If you ever face a problem, call me”. For this CMO, that was a hair-raising experience.
In another instance, a telecom brand had moved to a WPP rival agency globally and the change was all but confirmed to happen in India too. And yet it did not, not for several years. Rumour had it then that one of the calls made to the telco team in India was from Sorrell himself, assuring that if the relationship continued in India, he personally commits results.
He knew as much about Anil Ambani selling Mudra to Omnicom as he knew about IPL-Star deal and at times, more than people in India did.
Many stories have been told over time to create the legend of Martin Sorrell. Like every legend, most of it is rooted in truths. The underlying fact though is that Sorrell was available and involved in WPP’s India businesses and its clients in a much deeper manner than any of his peer could be or wanted to be. For him, being a micromanager was a compliment.
For 33 years, he had the same email id, and it did not matter who was emailing him, Sorrell replied.
He understood the power of the press – chances are that for most marketing and advertising journalists in India, Sorrell was either the first holding company CEO they interviewed or the only holding company CEO they interviewed.
He was in India more than anyone else in his position, and he made time for journalists and ‘influencers’ as he did for his clients. If a marketing journalist does not have a personal Sorrell anecdote to share, they either have not been in the trenches long enough or are not really in the ranks of reckoning.
This is not an easy act to follow. But it also raises the question --- does it have to be followed?
The flip side of the story is to understand what marketers want today. If this style was what they wanted, why have they been constantly asking for legacy businesses to evolve?
The Times They Are A-Changin’
The Sorrell-style of working, punctuated by Sorrell-isation and Sorrell-centricity at the core of WPP, has been successful. But the time for change is here.
As WPP navigates its complex structure and its assets portfolio, in the hunt for a CEO, it has several paths to choose from. This very situation creates the opportunity to craft the holding company of the future. If press statements are to be believed, this will happen sans Sorrell and his advice.
Let’s not forget that we are talking about WPP. Its characteristics may have been formed by one individual but its bench strength runs deeper than one can imagine. It is built on processes and systems, and it continues to be home to some of the brightest minds in the world.
India holds special strength in this equation. To say that WPP will fall alongside its founder’s exit, would be highly misplaced and ill-informed.
Sorrell himself has said that if all his businesses were like WPP India, he could retire.
Despite the pressure that it will face from its clients such as Ford or Kimberly Clark or others who have initiated or are initiating reviews for reasons varying from streamlining, working with zero-based budgeting or the pressures of procurement, WPP is poised to withstand the pressures it will face globally.
Even if it does split its assets letting go of certain businesses, which can compromise its position as the world’s largest holding company, its DNA is built to lead change. Let’s also note here – if Kantar is under pressure, so is Nielsen. The concern is not unique to WPP. But what these firms bring to the table are required capabilities. Whether it should remain within a marketing services holding company or not, is another question – one that WPP has the opportunity to revisit with an objective mind.
WPP leaders such as Mark Read, who is named one of the joint COOs in the interim for the company, are no strangers to markets like India – having made it a point to be in this market regularly. WPP India has some of the strongest leaders in our country at its helm.
It is true that WPP is hurt, but it also true that there is no Martin Sorrell around to lead an attack on it. An assault could come, and it could be from the newer players on the block like the consultancies, or maybe even the Amazons of the world, who would be looking at ways to leverage the vulnerable position that WPP and the advertising industry is in. But ad land, and its mightiest, is well placed to survive it.
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