India's Race to WPP's Top 3
On his first visit to India post-pandemic, Mark Read, CEO, WPP expressed his admiration for India’s resilience and strength in bouncing back despite facing a challenging three-year period. Read was last in India in the first week of March 2020, two weeks before the pandemic struck. WPP CEO Mark Read, who was here for the company’s board meeting, spoke to IMPACT about their scale-up plans, his faith in India as WPP’s fastest-growing market, and more. Q] Under your leadership this year, WPP won the prestigious ‘Company of the Decade’ title at the Cannes Lions. How does WPP differentiate itself from other agencies in the business? Q] You spoke about the work that Ogilvy and Wavemaker did together for Mondelez. It’s a campaign that was done jointly by your creative and media agencies. Do you think it’s time for the silos to break and consolidate media and creative? Q] According to your latest financial numbers, India grew by 0.8% in H1 compared to the 37% growth last year for the same period. This represents a significant drop. What factors caused this decline, and how do you plan to recuperate? Q] In a recent statement, you claimed that 50% of WPP’s tech offshoring for your global clients occurs in India, and you are looking to scale this rapidly. What are your plans for scaling up? Q] You often mention India’s strengths in areas such as creativity and technology. Could you shed light on the areas where India could improve? Q] What is your perspective on emerging opportunities in the media industry such as influencer marketing, retail, media, gaming, etc.? Q] In India, particularly, there’s been a lot of movement across agencies, because many Digital agencies have come up and Digital has become the new industry media. So, retaining talent has become a big challenge. How do you tackle that at WPP? Q] By when do you think India will be amongst your top three markets?
“I think since my last visit, India has had a difficult time, particularly when the second wave of COVID hit the country severely. Srini (CVL Srinivas, Country Manager, WPP India) and our other leaders, along with the whole team here in India stepped up for each other. Many clients helped us and we have helped them,” says Read.
Despite all odds, Read believes WPP had ‘great business here.’ Talking about 2023, which has been an exceptionally slow year for the industry so far, Read is optimistic that India will beat the global growth numbers in the second half.
“The Indian advertising market is anticipated to register a growth of approximately 12%, while the global advertising expenditure hovers around 6%. India’s surge is, in fact, double than the rest of the world,” said Read. He mentioned that the ICC Men’s Cricket World Cup and the festive season should get India to the magic number in H2.
In terms of numbers, it has been a slow year for WPP as well. As per their latest financial numbers, India grew 0.8% in H1 compared to 37% last year.
“We’re here because we truly understand what’s going on in the market and see the potential for India. So that’s what is on the agenda for us this week at WPP. Our job is to support them,” he added.
India presently stands as the fastest-growing and the fifth-largest market on a global scale for WPP, with a remarkable revenue exceeding $18 billion in 2022.
The advertising behemoth aims to elevate India to its top three global markets within the next five years. Presently, India contributes approximately 4-5% to the global business.
Talking about India’s performance over the years, Srinivas calls India ‘a growth engine for WPP’. “We have great talent, solid agency brands and deep client relationships in the market. Our Centre of Excellence (COE) in India has doubled in size in the last three years. We see this part of our business scaling up rapidly,” he said.
Expressing his delight in hosting WPP’s global board meeting in Mumbai this week, Srinivas shared how the rapid strides made by India, especially with its Digital Public Infrastructure, have caught everyone’s attention. “We’ve had interesting discussions on the future of our business, the many unique opportunities we have in India, and how the country can play an even greater role in shaping WPP’s growth strategy,” he added. The last WPP global board meeting in India was held in 2017 in Delhi.
The Chief Executive of WPP further shared how he has been holding discussions with Srinivas to expand the capacity and capabilities of the Indian team. “We will be spending our finance capabilities on technology development centres here. We have been talking about doubling the size of the WPP business in India over the next five years. I think that’s achievable. This means that we’ll be hiring 7,000- 8,000 people in the company over the next five years. There’s no reason why we shouldn’t be able to do that. So, that’s the scale of the investment that we’re going to make in this market,” he told.
Read further expressed his optimism regarding the advantages that artificial intelligence (AI) will bestow upon the advertising industry. “AI is my top priority when it comes to long-term technological investments,” he shared.
He emphasised the need to leverage AI in the company’s last investor’s call as well. Having high expectations from the acquisition of Satalia in 2021, Read announced that WPP has exciting future plans in AI being built on the back of the acquisition.
“We are leveraging our efforts through partnerships with leading players like Adobe, Google, IBM, Microsoft, Nvidia, and OpenAI, and also delivering work powered by AI for clients like Nestlé, Nike and Mondel?z. AI will be fundamental to WPP’s future success and we are committed to embracing it to drive long-term growth and value,” he added.
However, when asked if AI will lead to job losses, Read gave a dissenting view. “AI is likely to generate numerous employment opportunities and transform the nature of existing jobs. It may indeed displace some roles. If we consider WPP, half of our workforce is engaged in jobs that didn’t exist 20 years ago. Our responsibility as leaders is to position the company to create these jobs and avoid excessive defensiveness,” he remarked.
According to Read, AI will disrupt the advertising sector while simultaneously empowering agencies to develop new capabilities. “AI will empower us to undertake tasks previously unattainable. It will enhance the relevance of our creative messages to individuals. instead of eliminating what is necessary for creative judgment,” Read asserted.
He also observed that a significant global trend involves the fragmentation of the media landscape due to the entry of new players such as Netflix and Uber into the advertising arena.
“Fragmentation has undoubtedly increased the complexity of media planning, but I believe it underscores our importance as partners to our clients, which is ultimately beneficial for our industry,” he concluded.
WPP, known for its history of numerous acquisitions in the advertising sector, is committed to further expansion through inorganic means.
“We continue to make acquisitions with a focus on our key markets, including India. We are exploring opportunities in e-commerce, influencer marketing, AI, data, and analytics. India holds a promising potential in our acquisition strategy,” he pointed out.
Creativity is integral to WPP’s DNA and to our way of working. Why do clients come to a company like ours? It is because they need the very best ideas, and in some ways, it’s because we employ creative people and mavericks. We have people who have a great understanding of marketing strategies and consumers, and we’re able to combine those with our clients’ vision to produce groundbreaking work.
What we did for Cadbury, using Shah Rukh Khan to promote Diwali, is celebrated on the global stage. It contains a creative idea, an innovative use of technology, an understanding of the media landscape and how to develop and deliver that across the world.
India can play a significant role in the future of our industry, which is all about creativity and technology. Because we are in the business of imagination and intelligence, and India has great strength, creativity and tech expertise, it’s a unique market for us.
Media and creative come together under WPP, and I think clients want to see that. Businesses should be able to work fluidly together. So, the last thing I want to see is silos dividing parts of our organisation. Having said that, I don’t think the solution is to slam the businesses together. Rather, we need to have strong expertise and also be able to help those businesses collaborate.
There have been many great collaborations within the organisation that have shown the power of what we can do, and WPP has always stood together to help clients succeed.
GroupM is expected to grow about 12% this year overall. But there’s no doubt about the slowdown. The second half of the year is awaited and we are hoping for rapid growth. India, perhaps, is one of the only markets that didn’t decline in 2022. During COVID, it used to be flat, but in 2021 and 2022, we saw strong growth. So, despite a slightly tougher first half of the year, we hope to see strong growth maintained in the second half of the year, and for the many years to come.
We have a great offshore development business here. We call them centres of excellence – companies of WPP that help with production, building e-commerce websites and implementing Adobe or Salesforce and technologies. Those skills are in great demand. What we have in India is really strong technical expertise at a price point that makes it extremely competitive.
Having said that, I don’t see India as a low-cost country. It’s really about the combination of skill, expertise and price point. We see demand for those services expanding around the world. Technology has impacted the advertising communications business and has become more people-intensive. With AI expected to drive the demand for technology services, India can play a big role in delivering those services to the global WPP organisation’s client list as well.
I think India lacks a bit of confidence. But besides that, frankly, we could learn from India, certainly in the West. This is a young, vibrant and exciting economy. Returning after three years of COVID, it’s great to see people back in the office, collaborating and learning. It has embraced technology more readily than most countries have, especially with the explosion of Digital payments and the country’s Digital infrastructure.
I think that India has a bright future ahead, and is enjoying a renaissance today.
Commentators would say that the role of advertising is diminishing, and people are watching Digital channels instead of television, and newspapers have taken a backseat. Well, it’s clearly not the case, right?
We’ve seen an explosion in advertising opportunities with streaming platforms like Netflix, music and audio platforms like Spotify, and retail media companies such as Amazon, Flipkart growing their advertising. There has never been a more exciting time in our industry, now that opportunities have created a complex landscape for clients. That’s where we come in, helping clients navigate that landscape, having creative ideas to cut through the shadow, using technology to link them together and leveraging data to understand where those ideas are having an impact. The goal of WPP is to bring all of that together for clients.
Our goal is to have the best talent in the industry, and I’d encourage great talent to come and join us. We’re also bringing in new creative technologists to help people at the beginning of their careers. This is how we develop them and help them adapt.
Half the jobs in WPP did not exist 20 years ago. So, we have to bring people into new roles and also train and equip them to make transitions as their career develops. Hence, people look at WPP as a great place to work and develop their careers. Some people go on and develop great careers as clients in other parts of the marketing ecosystem, which is fantastic for us as well.
The forecast is that India is going to be in the top three global economies in 2028. For WPP, maybe that’s possible in the next five years.
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