Sorrell on the future of advertising

In a recent interview with Marketing Week, Sir Martin Sorrell, founder and CEO of WPP, the world’s largest marketing group, examined some of the key trends affecting the advertising industry, what it will look like in future and what exactly these trends mean for marketers.

Sorrell’s first piece of advice for marketers is to avoid siloing digital channels, as digital remains an important trend with potential for widespread growth: 37% of WPP’s spend on behalf of clients is digital. He cited research carried out by the Internet Advertising Bureau indicating a 13.4% rise of digital advertising spend year-on-year.

The debate now centres on the use of the word “digital’ in a marketer’s job description – many feel that it should simply be considered part of the marketing mix. Some have even gone so far as to remove digital from their vocabulary, and replace it with interactive. Sorrell made the decision to retain the digital distinction at WPP as he maintains it shows direction.

Marketers should not get too caught up in titles, he says, and should look instead at marketing channels collectively rather than as individual mediums. “Each channel and medium is attractive for different purposes. That’s why you have to look at it as a continuum – as a whole, as a portfolio – not just focus on one thing or another.” He sees Facebook as a branding medium and Twitter as a PR tool.

More robust measurement is required, he says. As digital channels continue to grow in dominance and account for more of the budget, marketers are increasingly required to illustrate its value, meaning that measurement needs to improve. Measurement remains problematic, because although Facebook and Twitter have created tracking tools, there’s no universal definition of an online ad impression. Ironically, measurement is becoming more necessary as marketers try to prove their value in the boardroom.

Marketers, says Sorrell, have to be able to justify their ad spend, but though cost-cutting is a reality, it’s not conducive to growth. The industry must demonstrate to clients that it makes sense to focus on the top line and point out that those companies that do are the successful ones.

Procurement is another concern for brands as it brings the debate about cost and justifying marketing spend on to marketers’ shoulders. But with a constructive relationship between agency and client, Sorrell says it can be tackled. A possible solution is bringing procurement back under marketing’s ambit.

Contrary to popular perception, client-agency relationships aren’t in fact broken. All relationships, he says, go through stressful patches, but that doesn’t equate to irreparable damage to a partnership.

Another trend affecting the industry is retaining talent. “The problem with our industry is that people think the way to get talent is by stealing it – they win a piece of business and they take talent from other agencies. It’s self-defeating,” he says.

Digital is going to change the way companies recruit, he predicts, adding that winning people over internally through effective internal communication will be core to finding and retaining top talent in future. “Your best ambassadors are the people inside your company.”

The big take-out: Sir Martin Sorrell identifies the trends affecting advertising as the need to think of digital channels as part of the marketing continuum rather than separate channels; a requirement for more robust measurement; a focus on the top line rather than cost-cutting; realising that client-agency relationships aren’t broken; and that all companies must work harder to retain top talent.