Marketing services giant WPP has begun hiring staff again, with a focus on its digital division and Asia markets. The move comes after WPP slashed nearly 14,000 staff last year as part of a cost cutting drive to counter to ad downturn. Group CEO Sir Martin Sorrell hopes WPP will do better than flat revenue […]
Marketing services giant WPP has begun hiring staff again, with a focus on its digital division and Asia markets. The move comes after WPP slashed nearly 14,000 staff last year as part of a cost cutting drive to counter to ad downturn.
Group CEO Sir Martin Sorrell hopes WPP will do better than flat revenue growth this year but has budgeted conservatively after being “once bitten, twice shy” on forecasts in 2009. The company has said that digital services will make up two-thirds its revenues in “three or four years” and that it expects 2010 to be a stable year. WPP reported an 11 percent drop in profits to £663 million ($1 billion) after a “brutal” 2009 and a particularly low second quarter. New media sales accounted for 27% of the advertising and marketing group’s revenues, or $3.6 billion.
08/03/2010
The group said revenues for the full year 2009 surged 16% to £8.7 billion, though like for likes declined 8%.
Speaking to MediaGuardian, Sorrel said: “Our budgets weren’t very good, it is a case of once bitten, twice shy. We were too optimistic last year, so the odds are we will be too pessimistic this year”.
The company said that the second quarter this year is currently on target to show top-line growth on a like-for-like basis, the first time WPP has a return to growth budgeted in for six quarters.
Following the primarily debt-funded acquisition of research firm TNS in 2008 WPP said it would cap its acquisition spending at £100m per year for two years.
The company is free to pursue large-scale acquisitions from October but Sorrell said the strategy would remain the same as last year with a focus on “small-sized acquisitions or investments in high-growth geographical or functional areas”.
Announcing the figures, Mark Read, director of strategy and CEO of WPP Digital,said: “We have to have digital in all our businesses. Technology is shaping our industry…however this is confusing for our clients and extremely complicated to manage.”
Interms of search advertising, WPP ad clients spent $520m in2009, representing a three-fold increase on the year before.
WPP is planning a “Digital Day” on April 23 where it will share more information on its digital strategy.
www.wpp.com
