WPP’s Mark Read faced the music
Following the announcement of its 2018 results last week WPP’s new CEO, Mark Read, faced an advertiser audience to talk about the ongoing transformation of the world’s largest advertising company.
- The outlook: business is tough in the US and UK, though there was good growth in Africa, Middle East, and Asia Pacific regions.
- Creative Transformation: WPP is now about a lot more than just being an advertising holding group. ‘Creative’ speaks to growth, innovation, ideas, Read said. “Ultimately, that’s what differentiates us as an organisation and other groups like us,” he added.
- “Netflix envy”: as the head of the world’s largest media planning and buying company, Read wasnot prepared to sing the praises of in-housing as a priority for advertisers. Instead, he argued that co-location or on-siting could be a more valuable strategy. “I do worry that clients get attracted by tactics and execution and lose sight of ideas and consumers.”
- The gender pay gap: WPP’s median pay gap shows that men are paid 14.9% more than women. Read said that putting the figures in the public eye had forced some change. “I don’t know how I feel about setting targets … but it’s probably helpful that these things are made public as it forces us to address the issue and look at it more than we would have done”.
Outgoing Unilever CMO Keith Weed took the stage both to praise and admonish the industry in which he has been a key leader. Though some campaigns are more impactful and effective than ever, there is a far broader and much deeper problem: trust.
“Ultimately, advertising does good but with trust in decline, we risk it losing that positive influence. A brand without trust is simply a product and advertising without trust is just noise,” he said.
Weed shared actions from the Advertising Association’s whitepaper on public trust, which highlights five key action points based on a survey of 2000 UK adults:
- Reduce advertising bombardment
The average consumer is exposed to 10,000 brand messages daily. “We’re all becoming very good at screening those out,” Weed noted. The IAB’s Gold Standard already brings the tools to support this shift.
- Reduce excessive advertising frequency and re-targeting.
When people have already bought something, being bombarded with lots of retargeted ads is deeply annoying, he pointed out. Over 50% of 35+ audiences, and 30% of millennials are annoyed by obvious personalisation. At the same time, 53% of marketers are set to increase budgets in this area.
- To ensure that the ASA is “best in class”
When consumers know about the Advertising Standards Authority, their trust in advertising grows, but the industry needs to help them, Weed said. Namely, by aiding the shift across to digital advertising, with the help of media platforms in order to support the body in holding up to scrutiny the huge quantity of content now published.
- To ensure that data privacy matters
A growing topic that is particularly acute in Europe, where 73% of people are concerned about their data privacy.
- Illustrating that advertising can drive social change
Weed pointed to initiatives such as the UN’s #Unstereotype, and ITV’s Vegpower, and the Advertising Association’s Ad Pays report as signals of this, bit there needs to be more.
During a panel discussion, the ever present topic of marketing effectiveness continued to demonstrate how despite better tools and more awareness, businesses are still struggling to align the processes that demonstrate and measure effectiveness with a culture that prizes this.
“We have to help CMOs in the boardroom, to articulate the value, the payback, the return, the reason that investment in marketing for businesses is so important,” said Janet Markwick, formerly Y&R’s Global EVP Commercial Operations and Production.
Gain Theory’s John Webb argued that there were several systemic reasons that were putting marketing under pressure. First there is the lower barrier to entry for competitors, coupled with an increasingly complicated media landscape.
Additionally, “it’s really, really hard for marketing to be effective in a world where investment opportunities are drying up”. He pointed to the increasingly popular US business tactic of share buy-backs, which are “massively outstripping” investment in the long-term future of the company. That context, set against an economy in which organic growth is incredibly low means that the battle is for market share – “that’s a tough battle.”
Crucially, a culture of effectiveness has to be the CMO’s main concern, said Direct Line Group’s Mark Evans. “Curiosity is key,” first of all, keeping the marketing department interested and hungry in changing the method according to what’s working.
What’s working is more important than the creative output in conversations with the rest of the business, he added. “If you’re really proud of your ads, show them to your mum, don’t show them to the board.” Show them return on investment, talk to them about managing the media landscape “so you can show that you’re on it”. Confidence in the marketing department is key to proving it’s more than a colouring in function.
Goals are important to agencies, more so than creative. Markwick argued that there are still too many briefs in which the leading objective is the execution rather than the commercial goal. Libby Child, of Greengrass consulting agreed that getting clarity on what success looks like for both client and agency is fundamental.
Media in 2024
Panellists hoped for maturity in the media landscape in five years’ time. Though digital advertising has been around for a long time, CMOs are still adjusting to their roles as managers of media, creative, and technology. In five years, the diversity of the role and its levers needs to become clearer.
Thinkbox’s Chair, Tess Alps expressed the hope that advertising would wake up. If advertisers believe they can value a view on a premium piece of TV content the same as a view on a piece of user-generated Facebook content, then there will be no ad-funded TV left by 2024, as consumers will be paying for it themselves. There will be little of quality left to advertise against.
She went on, addressing the representatives of Facebook and Google, that every second of TV content is vetted before it goes on, despite being paid for, “[YouTube and Facebook] content is not even paid for and they can’t vet it”. The appetite for a more level playing field between traditional and new media was palpable.
Advertising’s role in the world
The head of the RSA, Matthew Taylor addressed the ISBA audience with a warning about advertising’s place in an increasingly disintermediated world.
“In the face of some of the challenges I have described today; if you can’t prove you are part of the solution you may be made to be part of the problem,” he said.
“The question of how advertising can be and be seen to be a source of good in these tumultuous and tech-driven times is one you should walk towards not shy away from.
“In the end the strongest reason for hope is that this is a sector of creative and innovative people, who understand communication and how to influence every one of us.”
Sourced from WARC