The future for the global digital and advertising industry in 2021 is bright, according to Sir Martin Sorrell, but told businesses if they can’t grow next year they never will.
Speaking to New Digital Age editor Justin Pearse at MadFest about his views on how the advertising industry would evolve during 2021, Sorrell, who now runs S4 predicted a positive outlook for the global economy in 2021 with a potential increase in GDP of up to 5% which should be good news for the agency networks and companies, especially those focused on digital capabilities for clients like his own S4 Capital.
“If you dropped 10-20% in Q2 this year then the comparables are next to nothing. If you can’t grow next year you never will,” he stated, while considering the enormous impact the coronavirus pandemic had on the major networks during the second quarter of the year and the chance the businesses have to show significant year-on-year growth in 2021.
“You have to go back a long time to when inflation was as rampant.”
Of the early success S4 Capital was seeing and what it was doing right within the industry, he said that the company was “creating opportunities” for its people with further employment growth likely with the appointment to work with BMW adding another 10% to the 3,000 total headcount and potentially more with further new business set to be reeled in.
This could offer some potential good news after Forester predicted the loss of around 52,000 jobs from within advertising in 2021.
He also spoke about S4 Capital being a rival of global consultancy Accenture rather than any agency network, however he also admitted that its current size meant it was still simply “a pimple on the elephant’s backside” in comparison by scale.
Sorrell also discussed his belief former Mindshare chief executive Nick Emery’s departure following ‘a prank’ that took place during a company video call played into ‘an agenda’ within GroupM.
He also discussed the merger of two agencies within his former business WPP, AKQA and Grey to create AKQA Group, describing the strategy as “management by spreadsheet” and claimed that the response from individuals within both agencies directly to him came with “a great deal of concern”.
“It seems to be a little bit rushed and it’s a bit confusing,” he said, adding that AKQA chief Ajaz Ahmed, who will run the merged business had, “a big task” ahead of him.
“Calling it the AKQA Group creates uncertainty, and during a pandemic the last thing you want is uncertainty. It has to have quick clarity,” he said before talking about the need for strong leadership to take on a merged business, citing similar mergers within WPP such as Wunderman and JWT and between VML and Y&R in recent years.
This led him to cite the departure of Emery as being “slightly strange” although he did add that he didn’t know the full details behind the incident.
“Nick has spent 23 years of his life building up Mindshare from scratch, alongside Dominic Procter and others and was a great leader of Mindshare just like Steve Allen was a great leader of Mediacom. It seems to me, to be blunt, there was a bit of an agenda there.”
“Christian Juhl [chief executive] at GroupM wished to execute change and didn’t want people of independent persuasion there. You have to surround yourself with people who are prepared to fight their corner which can sometimes be difficult, but good people are difficult-to-manage, average people are easier to manage.”
Finally, when asked for his advice on what CMOs should do to achieve success in 2021, he cited the need for agility, to hold their own first-party-data and to take back control of marketing, having spent the last decade outsourcing in order to reduce costs.
“Unfortunately finance and procurement have forced marketing down the ladder and we have to re-establish it – particularly in an online environment,” he concluded, adding his belief that the new ways of working due to the pandemic have not led to the creation of anything new in terms of remote working and online purchasing in an increasingly digitally-connected world.
“All those things were going to happen anyway. What Covid has done is accelerate it even more. We’ll see more of that. 2021 will be the year of even more accelerated technological transformation, it is the V-shaped sectors which are really going to be the ones which benefit.”