In an interview, Read highlighted the strong growth of several parts of the business, including Group M, Ogilvy, and FGS Global. However, he acknowledged pressure from technology and retail clients, particularly in the US. Looking ahead to 2024, Read expressed cautious optimism, citing the continued need for marketing investment by tech companies. He also discussed the company's focus on artificial intelligence and data, and the potential benefits for the business, but declined to comment on the scale of expected job cuts at VML and Group M.
Key takeaways:
- WPP reported annual revenue growth of 0.9% in 2023 and is forecasting no more than 1% in 2024. The company also took an impairment charge of £633 million (US$806.5 million) on the value of its creative agency brands, Wunderman Thompson and Y&R.
- WPP's CEO, Mark Read, declined to comment on the scale of expected job cuts at VML and Group M but said he hoped to “restructure the business as much as we can through attrition”—by not filling roles rather than through redundancies.
- WPP is set to pay £392 million (nearly $499.6 million) in bonuses, down 8.5%, but cut freelancer spend by 19% in 2023 as the company shifts investment more towards permanent staff after a surge in the use of freelancers during the pandemic recovery.
- Read also mentioned that the company sees AI as a way of driving improved financial results and return on their clients’ investment, and therefore, increasing the value that they deliver to clients. This should be beneficial to the financial returns at WPP.