WPP’s Tough Year Is A Bellwether For All Adland

WPP is used to being the darling of the City. Although Sir Martin Sorrell’s ridiculously high pay packet prompts an annual shareholder revolt that typically goes nowhere, the holding company is about as reliable a performer you could ever hope for in adland.

Until today. Its share price slumped 11% as London opened this morning after it admitted growth would languish between zero and 1%, significantly below expectations. The main reason was pretty fundamental. Clients are spending less money, they’re thinking more short-term, and zero-based budgeting is becoming more common. That was the message on the morning call with analysts and reporters this morning.

It differed from Sir Martin Sorrell subsequently telling Sky that the “cancer” and “killer” that is Brexit was a major factor because the uncertainty it creates is hard to deal with. The WPP announcements earlier also did not reference a deterioration in the relationship between Trump and big business, which Sorrell also referred to with Sky as part of the poor business background against which these figures should be presented. He even mentioned Charlottesville on Sky News, which seemed a reach for a Chairman trying to account for poor figures up to and including the end of the second quarter.

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