A blog from The Drum's editor, Stephen Lepitak, covering reaction to events in media, social media, marketing, advertising and communications in general.
Why Wunderman will be WPP’s jewel in the crown under new regime
It wasn’t a surprise that within weeks of Mark Read taking over the reins at WPP, he would move to fill the void left at the top of Wunderman by his ascension.
The choice for Wunderman's new global chief executive was a straight shoot-out between the EMEA and American chiefs within the agency, and ended with Mel Edwards taking charge. Now she, in turn, is looking for someone to step into her shoes as EMEA chief within the business with internal and external candidates in the frame.
In the last two months, WPP's most recent acquisitions have both been by Wunderman. It took majority stakes in Salesforce specialist Emark and Gorilla Group to bolster its e-commerce offer. A plan is most definitely taking effect.
While we are guaranteed to see more consolidation within WPP as Read makes his mark, Wunderman is the one to watch within the reshuffle. Expect it to become central to what remains the world’s largest advertising agency network’s future with Read holding dear a digital business that offers exactly the requirements that modern marketers crave – insights and digital strategy capabilities.
When appointed to the role of leading Wunderman in 2015, Read was very much ‘the digital guy’ within the network, and for those with an eye on the succession of Sorrell, this looked like a step towards the top job, as it ultimately proved to be three years later.
The 60-year-old business, founded by Lester Wunderman, now has 175 offices worldwide, spanning 60 countries. That it was acquired by Young and Rubicam in 1973, which in recent weeks has been merged with VML by Read to form VMLY&R (with VML very much subsuming Y&R) is a fascinating sign of how much the advertising industry has changed. The Drum has also been informed, by a source close to the business, that prior to the change in leadership, VML & Y&R were both considered to be folded into Geometry Global, and so it remains to be seen what more may happen there.
There are rumours galore at the moment over what is likely to happen in terms of bolstering Wunderman’s creative credentials. Word on the street is that J Walter Thompson could be merged into the business - both hold significant work with Shell. But the consensus is that Read wouldn’t wish what might be seen as a potentially diminishing agency brand (especially following its Ford loss) to detract from Wunderman’s Gleam.
The Drum understands that senior personnel within WPP believe that Grey is the better fit to join the Wunderman fold. And there is no doubt that with that extra fire power, the resulting business will be looking to ward off the continuing threat of the consultancies moving onto the advertising sector’s turf.
Bringing in the creativity of Grey’s 5000+ employees would go some way to bolstering an offer that is already respected by the wider industry and prove Read is serious in his “radical revolution”.
It’s understood that no decision has been made but that further movement within WPP in terms of consolidation is likely to take place in the coming months in recognition of the headwinds the agency world has faced in recent times – and is likely to continue to face for the foreseeable future. While any further developments in terms of merging are still mostly speculative, with only Read, Quarta and his very close allies knowing what is really on the cards, more change is inevitable, and rightly so.
If Publicis has created its own digital jewel in the crown with Publicis.Sapient, then WPP and Read will view Wunderman as a direct competitor.
Questions can also be asked about other digital leaders within the business – how can AKQA be revitalised to reach the heady reputation it once held when acquired in 2012 for instance? And further questions are being asked about the next stage for Ogilvy, having lost some of its most senior minds in the last 12 months in both the US and the UK. Are there further senior departures on the cards there? It will surely aim to rebuild its reputation having also rebranded this year to focus back on advertising’s most revered copywriter.
Mark Read hasn’t been handed a remit of ‘business as usual’. He has been told to turn around the recent fortunes of WPP and create a group fit for the future. And while some businesses may feel pain as that memorandum is realised, it’s likely to be a strategy witnessed elsewhere across other networks who follow suit. What will the response be from competitors such as Publicis Groupe, which has already consumed LBi through Digitas and Razorfish through SapientNitro? (Some suggestions are that Leo Burnett and Saatchis may merge to form a super ad agency, although does the industry really need that?) Meanwhile, Omnicom, Havas, Dentsu and Interpublic will have thoughts of their own in order to shore up their empires.
And in the wings are Accenture, S4 Capital with money to spend on acquisitions and ambitions to take more business away from the usual suspects.
Stephen Lepitak is the editor of The Drum
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