LONDON (Reuters) – Martin Sorrell’s departure from the world’s biggest advertising company heralds change for his sprawling WPP empire and may accelerate a shake up of the big ad groups that followed his lead.
WPP and its major rivals Omnicom, Publicis and IPG face challenges on every front, from the might of Google and Facebook – whom Sorrell famously dubbed “frenemies” – to the rapidly encroaching consultants Accenture and Deloitte.
With clients demanding ever-lower fees, big advertising groups must learn to be more nimble and efficient to protect their revenues and avoid pressure on them to break up.
“I don’t think this is the event that brings down the holding companies,” industry adviser and MediaLink Chief Executive Michael Kassan told Reuters. “I do believe this is going to force everybody to rethink.”
Ad groups embark on their latest transformation without Sorrell, the godfather of the modern industry who quit after 33 years over an investigation into misconduct. WPP does not plan to release results of the probe. He denies the allegations.