WPP has been on a transformative path for the past five years and we had the chance to speak with you back in 2019 when you first embarked on what was seen as the road of radical evolution. Would you say you have achieved what you had wanted and is WPP today what you envisioned back then?
When we embarked on the journey of creative transformation, WPP was a conglomerate of various entities and worked in a structure that may or may not succeed in the digital age. We initiated our transformation by integrating the analogue and digital parts of our business. So, merging major agencies such as J. Walter Thompson with Wunderman, and Y&R with VML.
Financial restructuring was another early step. We had to address a stretched balance sheet and high net debt, leading to the Kantar transaction, which was a significant move towards financial health. WPP today is a much simpler company, and we are much stronger creatively. As a more integrated company, having streamlined our operations, we have improved interactions and creative output, which is reflected in the positive feedback from our clients and our enhanced market position. WPP today stands as a more cohesive, creative and technology-driven organisation. This structural simplicity has also enhanced our operational efficacy.
India has always been an important growth market for WPP. How has it evolved for you in this time?
Yes, India has always been a vital market for us. Over the past five years, we have aligned it closely with our global strategy, transitioning into a more streamlined operation. Despite global challenges such as the pandemic, geopolitical tensions and economic uncertainties, our operations in India have grown stronger. These adversities have highlighted the resilience and strategic importance of the Indian market. Our local teams have leveraged these challenges as opportunities to innovate and drive growth, reinforcing WPP’s leadership in one of the world’s most dynamic and fastest-growing markets.
In this period, and perhaps even due to these challenges, businesses have rediscovered the value of marketing, the importance of brand building, the role that reputation can play in business success and the need to bring strong purpose and culture within the organisation. They understand the importance of adapting to a more technology-driven future and taking advantage of the data they have that is available in the market. As a result, many of their biggest and marquee challenges are the ones that they come to WPP and our agencies to solve. The industry overall is in a better position than it was five years ago.
WPP now follows a six-network strategy, a few markets like India being an exception of course. What does this entail, and how does it benefit your operations?
Our six-network strategy is about making our company easier to navigate and more responsive. By consolidating our agencies into six powerful networks, we can offer comprehensive services that leverage global insights and local expertise to our clients. Therefore, this structure not only enhances our agility but also allows us to deliver more integrated and technologically advanced solutions. For instance, VML has grown significantly, now employing 30,000 people worldwide and delivering powerful outcomes for both global and local clients.
The six networks, that have some sub-brands like David within Ogilvy, make up for about 90 per cent of our business. We understand the need to be flexible but what we want is market-leading brands in each of the disciplines we operate in. This being said, we do believe in brands. The question here is what is the right number of brands in an organisation? Someone once said to me that you should have as many brands as needed but as few as possible. That is an insightful way to think about it.
The phasing out of the J. Walter Thompson brand was a significant move. What was the market feedback for this decision?
It was a pragmatic decision. Globally, J. Walter Thompson had not kept pace with market changes, diminishing its influence. I understand that was not the case in India but sadly, that was the case globally. The damage to the brand was done more than a decade and a half ago, and it had become a shadow of its former self. By merging it into a more dynamic brand, we aimed to rejuvenate its legacy and align it more closely with current and future market demands. Our judgement was that the combined business would do better work for clients, provide more opportunities to people, grow more strongly and be more profitable than what it would have been when the two businesses were apart, and that is the task we have to deliver on. So far, the integration has been beneficial, improving our service delivery and enhancing client satisfaction.
The world is changing at a much faster pace around us. If we do not change, we don’t deserve to succeed in the future.
Can you also discuss the strategic importance of India in WPP’s global operations, and what you define as the India-first strategy?
India is not just a market for us, it’s a hub of talent and innovation. I am very proud of the work that Srini (CVL Srinivas) and the team have done. We have similar operations in Australia, Brazil and other bigger markets where we leverage the value of the group for the benefit of our clients and people.
We were in India last year for our global board meeting, and one of the statistics that struck me was that one in four of the world’s workers is Indian. India is the workforce of the world in many ways.
Through our Global Delivery Centres (GDCs), India can be a technical capability for the rest of WPP to help us innovate and deliver services more efficiently and effectively. India is instrumental in driving technological advancements across WPP.
The scalability of our operations in this market allows us to support global projects efficiently, making it a critical component of our global strategy. Also, as Indian companies continue to grow, they find a familiar partner in WPP to navigate global markets.
You have also emphasised the importance of AI in WPP’s future strategy. How is AI transforming your operations?
It has been very clear in the past year how fundamental AI will be to WPP’s future and how it will drive transformation in every industry, including marketing. Among our strategic growth pillars, the biggest difference from the past is our commitment to invest in AI.
For the first time, we can deploy technology in the creative parts of our business. We have used AI in our media business for many years to optimise media campaigns, devices, search, strategies and buy programmatic. We have also used it in our production business across several tools. The Generative AI explosion however is different. It is going to be impactful and transformational. It will set the scenario, where by bringing what we do together, WPP can lead the industry. It is going to bring the creative, production and media parts of our business much closer together.
Unlike in the past, when there were several clear steps from writing a brief to delivery, in an AI-driven world these handoffs do not exist any more. The creative team has an idea and it can be produced instantaneously and taken to media, optimising the creative and media in real-time. This is already changing and it will change even more fundamentally.
AI will not replace creativity or people but it will augment them and make them more efficient. One of the goals of our investment in WPP Open, which is our AI-powered marketing operating system, is to enable our people to collaborate across the organisation and we are seeing powerful results from that already.
While you say that AI will not replace people, we did see some amount of unrest in the larger creative fraternity, with writers even going on strikes last year…
There is no doubt AI is going to change many jobs. The problem is that it is much easier to identify the jobs it is going to disrupt than to identify the jobs it is going to create. If you look at WPP, most of the jobs we have in the company right now probably did not exist a decade ago. We did not have marketing managers or programmatic media managers. AI will create many jobs and perhaps even more in markets such as India where we are managing the systems. It will equip our GDCs with more insights and capabilities than it has done in the past.
We have to train our people to use it, be at the forefront of using it and be very flexible in redeploying people in new areas. AI will create many new jobs and capabilities. The people and companies who will win are those who invest more effectively and embrace it quickly.
What role do partnerships play in WPP’s strategy, in the AI context?
Partnerships are crucial, especially in technology adoption. Collaborating with tech giants such as Amazon, Microsoft and Google allows us to leverage their significant AI investments.
WPP Open, for example, is powered by our own proprietary Al products, WPP Brains - each is trained on a variety of data sources and Large Language Models to optimise the entire marketing process, and our first Brand Brain was built on Amazon Web Services in fact.
This collaboration accelerates our product development and innovation processes, enabling us to offer cutting-edge solutions to our clients. Our focus on people plus technology, underpinned by strategic and creative judgment, ensures that our AI applications are both innovative and ethically sound.
Looking ahead, what are your expectations for WPP in 2024, especially considering the potential economic conditions?
We are optimistic about 2024. The post-Covid recovery has been robust, particularly in India, and we expect this momentum to continue. Our focus will remain on deepening our AI capabilities, enhancing creative output, and ensuring operational efficiency. These pillars will support our financial goals and reinforce our market leadership.
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