MUMBAI: When WPP group CEO Martin Sorrell speaks, the world listens. And he does not pull any punches.
Sorrel, while speaking at the FT Digital Media Conference in London yesterday, said something that should make owners of traditional print media like newspapers and magazines sit back and do some introspection about their future. Sorrell said that advertisers should think about reducing the amount that they spend on newspapers and magazines and focus more on online and digital media.
The WPP group and its clients are already doing that. Come next year, and Google could well overtake News Corp next year as the place where the agency spends most of its clients‘ money.
Citing numbers, he said that 34 per cent of WPP‘s $72 billion media investments on behalf of clients went towards digital last year.
ews Corp - a relatively more traditional print media player with oodles of magazines and newspapers - was the biggest media outlet for its clients‘ communications at $2.5 billion last year. But Google is coming on strong and WPP spent $2 billion on ads across its products, which was a 25 per cent jump over last year.
By the end of next year Google could push News Corp away as being at the top of the list of media outlets where WPP spends its client money, he highlighted.
Citing data from the US, where WPP spends $40 billion a year on media, Sorrell said that there is a big disparity between advertisers‘ print spend and consumers‘ print usage. "We are investing 20 per cent of WPP clients‘ media budgets on magazines and newspapers, but consumers are only spending seven to 10 per cent of time consuming print. That has to change."
He pointed out that the share of ad spend in other media such as TV, outdoors and radio is matching the time that consumers spend on them "TV viewing is about 43 per cent of consumers‘ time, (ad) investment is 43 per cent" he said.
He has also accused Google, Facebook and Twitter of being media owners masquerading as tech companies. "I do regard Google as a media owner, yes. These are media owners masquerading as technology companies. Google sells Google, Facebook sells Facebook. Twitter sells Twitter."
