WPP CEO talks Silicon Valley, Brexit, and branding
WPP’s CEO, Sir Martin Sorrell, is not known for keeping his opinions to himself. After confessing his concerns over the role Amazon would play in the digital advertising landscape a few months ago, Sir Martin has spoken about the Silicon Valley heavyweight again, this time, in light of its recent acquisition of Wholefoods. Discussing the shift of power and interest towards Amazon, Sorrell said:
“It used to be more ‘what’s happening at Google and Facebook?’ That is still the case, but now it’s more about what’s happening at Amazon.”
Speaking outside the Cannes Lions ad festival in France, Sorrell was quick to highlight the takeaway for advertising agencies in Amazon’s most recent move. He told The Australian that:
“Whole Foods is clearly sending a signal about bricks, retailing and clicks. It’s clearly sending a signal about the importance of data. It’s clearly sending a signal about the importance of a direct relationship between the manufacturer and consumers. It’s sending a message that chief marketing officers have got to understand where their e-commerce budgets are because most e-commerce budgets are not in the marketing function — they’re in the sales function — so it consolidates that. It also sends a message that Amazon has become an even more powerful company not only in content, but music, voice-activated devices, cloud computing capacity and controlling data. It’s a formidable machine.”
Sorrell has spoken about Amazon previously, and it is no secret that WPP is developing teams and agencies to deal with the platform especially. However, Amazon is not the only tech company on his mind. He also took the time to opine on Google and Facebook’s current woes over extremist material and offensive content online:
“It took a time for Facebook and Google to understand… Google has had to deal more with the consumer brand safety issue. Facebook is now starting to understand that the political brand safety issue is probably an even more serious one.”
Here, Sorrell is plainly referencing the politically unstable times in which we are living. Having been a prominent campaigner to keep Britain in the European Union last year, he was also keen to tell gathered reporters how Brexit was affecting business in the UK, and what WPP felt businesses should be doing to prepare for it:
“Clients are feeling quite cautious. It’s a low-growth world. Very little inflation and therefore very little pricing power and therefore a focus on costs sadly. But I think they’re focusing on the wrong things but I would say that because it’s in our interests. We think they should be focusing on innovation and branding.
“A lot of the short-termism emanate from the fact that if you take undue risk and make a mistake, you get chopped. We have to hammer home the message that investment in innovation and branding works from an investment and total shareholder return point of view. The companies that grow fastest are the ones that invest for the long-term.
“My view is that if you said choose between the short and long term, I think I would go for the long term. If we were private, I think we would do things differently. That’s probably the best way of putting it. If you’re in a controlled public company, you’re a Jeff Bezos [Amazon CEO]. You’re going to make investments for the future in relation to Amazon.”
Dominion holds WPP in its Global Trends Managed Fund.
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