WPP CEO Mark Read has worked to make the holding company faster, simpler and more collaborative.
Since taking on the top role a little over a year ago, Read reshaped the world’s largest holding company, notably folding creative agencies J. Walter Thompson into Wunderman and Young & Rubicam into VML. He also sold a majority stake in Kantar to Bain for $4 billion.
“Agencies are being disrupted like every business is being disrupted,” Read said. “But I’m positive about our ability to evolve to be the partner that clients need to succeed.”
Despite this streamlining, Read doesn’t want to diminish WPP’s agency brands. He wants clients to feel like they’re working with a WPP agency, with access to an underlying technology and data platform.
The plan is still a work in progress. In Q3, WPP’s revenue in North America slid 3.5%, an improvement over prior quarters but an indication the company still has a lot of work to do.
“We set out a three-year plan,” Read said. “It will take time.”
He caught up with AdExchanger.
AdExchanger: What’s the past year been like for you?
MARK READ: It’s been a busy, productive year. We started to see results in terms of relationships with clients, new business performance and growth. Performance in the United States has improved. The balance sheet is in a much stronger position with the Kantar transaction. We’re a simpler, more focused, client-centric, collaborative WPP.
Is WPP easy enough to navigate?
There will always be more tidying up. But we are simpler. We’ve integrated a lot of the analog [and] digital parts of our business. We’re organized more around clients and ideas than we are around channels.
What’s changed the most about WPP’s culture?
We’re building a culture that’s open and optimistic. Collaboration needs to be at the heart of that culture. Our clients want our people to work together.
Is that hard to do with agencies that inherently compete?
I don’t think agencies inherently compete. They may have been encouraged to compete, but it depends what incentives you give them.
We’ve been clear that we need fewer, stronger brands and smaller, specialist brands. I’d like nothing more than for WPP to be recognized as a company with strong brands.
How has WPP evolved its relationship with tech companies?
We need to be the best people working with Google, Facebook and other tech companies. It doesn’t mean we don’t have difficult conversations. But we have to have productive relationships.
Google is our second-largest client. That gives us insight into how they operate and tremendous credibility with clients.
Your competitors made acquisitions in the data space last year, but WPP has been quiet. What’s your data strategy?
Clients want data-driven insights and targeting, and they want to measure results. They don’t care whether we own a piece of data unless it delivers higher ROI.
Our investments go into stitching together technology. The real problem is data integration. If anything, it increases the role for agencies to understand the ROI of the platforms and how to allocate spend across them.
What will WPP’s tech stack look like?
Our vision is one open platform that sits across WPP and enables the components to talk to each other. It’s the ability to combine data, optimize campaigns, measure results and derive insights.
It’s a significant effort and it will be a long-running competitive advantage. We’re really just getting started.
WPP has tried to centralize its technology capabilities before. How is this different?
We used to approach it company by company. Now we’re approaching it as WPP as a whole.
We have been in advertising and marketing technology for some time. Xaxis remains a success. We need to approach it as a business as a whole, but it takes time to put together.
What do WPP’s mergers last year say about the future of the creative business?
Creative agencies have specialized in producing assets for analog media. Demand for that has diminished. Platform and audience need to be much more integral to the creative brief. The separation of creative and media probably made life harder for the creative agencies. We need to integrate, perhaps not organizationally, but much more tightly in the work we do.
We needed to make some difficult decisions. My view is in the next three to five years, that will put us ahead of our competition. It was absolutely the right thing to do.
What do clients most want from WPP as a partner?
They’re looking for integration across their agency partners. Some clients have fewer agencies. They’re consolidating their activities. Cost is clearly at the top of their mind.
Speaking of cost, how does WPP push back on unfair demands in pitches?
The best clients choose their agencies based on the quality of the response and the team put forward. While price plays role, I very rarely see a pitch that’s just about price.
But it’s always a factor.
We have to be competitive. The market has been competitive.
Is WPP not participating in pitches led by Accenture?
I’ve been reported as saying that, but I don’t recall having said that. We do have concerns about sharing information with other companies and how that’s being used.
What’s WPP’s biggest opportunity in 2020?
To help create customer experiences. The commerce side of the business is a really big opportunity, because every company today is an ecommerce company.
And helping clients navigate the marketing technology landscape and embedding Adobe, Oracle and Salesforce in their marketing activities.
Sounds like consultant work. How do you get clients to pay you like a consulting firm?
A lot of it is consulting. We have tremendous depth of experience in that area around the world. That’s a growth driver as those companies grow.
Our margins are actually slightly better than Accenture’s margins.
This interview has been edited and condensed.