That was the message from world chief Brian Lesser on the holding firm’s newest earnings name (August 7). In a market the place shopping for energy has misplaced a few of its heft within the eyes of CMOs, Lesser highlighted its information because the differentiator.
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“We now have extra information than any of our competitors reaching 5 billion customers, connecting intelligence of all varieties, together with IDs, throughout an unlimited federated ecosystem,” mentioned Lesser on the decision.
It’s a line that’s been making the rounds with shoppers within the U.S. and the U.Okay. for months, advert execs informed Digiday.
“They had been speaking lots about de-duplicated attain in that assembly,” mentioned a senior marketer, who anonymously shared particulars of their dialogue with WPP.
Behind the jargon — speak of “de-duplicated attain” and “federated ecosystems” — is a bigger shift. WPP, like its friends, is making an attempt to maneuver upstream — away from time sheets and media margins towards one thing nearer to software program.
“The plan is to maneuver away from promoting individuals’s time, providers and their very own stock and transfer to promoting platform-based options,” mentioned a former WPP Media exec.
The thought isn’t new, however AI provides it extra weight — permitting businesses to bundle instruments CMOs should purchase quite than hours they will invoice.
For WPP Media, that software is Open Intelligence, the group’s information answer and AI mannequin. They energy Open Media Studio, WPP’s end-to-end media planning, supply and measurement platform inside the WPP Open providers suite.
In contrast to Publicis, which owns Epsilon, or Omnicom, which owns Acxiom, WPP doesn’t personal a big first-party information set. As an alternative, Lesser’s wager is that possession is overrated — that entry, scale and the flexibility to combine companions is sufficient.
Why? Open Intelligence combines the identical quantity of conventional id information as opponents with lots of of extra companions together with media, commerce and information firms similar to Google, Amazon and TikTok. These datasets — usually behind walled gardens — are related through WPP Media’s federated studying expertise permitting the group to research and mannequin efficiency with out centralizing or proudly owning the info.
The promise, based on one marketer and three consultants who’ve heard the pitch: extra correct predictions earlier than a greenback is spent that result in higher outcomes as soon as they’re.
“We’ve got seen success with this already on a few of our long-standing shoppers when it comes to outperforming conventional identity-based approaches to efficiency,” mentioned Lesser on the earnings name.
That pitch helped win Amazon’s media enterprise in Europe — not as a result of WPP owned a mountain of information however as a result of it satisfied Amazon it didn’t want one, mentioned the previous WPP exec. Whether or not different advertisers, particularly these much less technically fluent, will purchase in is much less sure. Even Lesser acknowledged as a lot.
“When it comes to Mars, we had been within the technique of deploying Open Media Studio for [them],” he informed analysts on the decision.
It didn’t stick. Mars selected Publicis as a substitute.
What received out, based on two individuals conversant in the choice, was Publicis’ capacity to indicate the way it might tie artistic selections on to efficiency — by means of a tech stack Epsilon helped construct and Publicis really owns. That type of vertical integration isn’t one thing WPP can but declare.
And that’s the rub for WPP: it’s asking CMOs to purchase into a giant concept earlier than the proof is there. That may work if the imaginative and prescient is sharp sufficient — and clearly it was for Digital Arts, Hisense and Hero Motocorp, which have all employed or re-hired the group this yr. However not each advertiser is offered. They’ve heard comparable guarantees earlier than solely to get optimization for clicks and conversations quite than enterprise outcomes.
What they need is built-in artistic and medium backed by credible modelling — not one other spherical of recycled attribution math.
“I got here away from a current assembly with [WPP Media leadership] with loads of questions and informed my contact that I wanted to go away and give it some thought,” mentioned the senior marketer who met with the group earlier this yr.
On the heart of that hesitation: de-duplicated attain. Nonetheless one among promoting’s greatest unsolved issues. The promise from WPP was that Open Intelligence might ship a sharper, unified view of what number of actual individuals really noticed an advert throughout platforms.
“That’s fairly the declare and that’s earlier than you take into account the truth that they don’t personal loads of information,” mentioned the marketer.
A number of that relies on InfoSum — now a part of WPP’s stack — and its capacity to match and mannequin information throughout walled gardens and different on-line areas alike. In the course of the assembly, and on the decision, it was positioned as a foundational piece.
That centrality is now shaping WPP’s wider technique. Digiday understands WPP is (partially no less than) pulling up the drawbridge relating to its third-party tech and information relationships in favor of its inside toolset and choose companions that meet particular standards. In line with sources, this has been characterised by WPP rebuffing partnership pitches, with executives there understood to be shifting all media planning and shopping for to its personal suite of merchandise, similar to Open Media Studio.
Nonetheless “pulling up the drawbridge” doesn’t imply going it alone. Open Intelligence not too long ago added 22 new companions together with FreeWheel, Lumen Analysis, DICK’s Sporting Items and Criteo.
The lengthy street to transformation
In equity, it’s been simply 4 months since Lesser rolled out his plan, so there’s nonetheless time for it to take maintain. There are even indicators of progress: in some entrepreneurs and classes, WPP has been extra aggressive on pricing and extra attentive to shoppers it needs to maintain, based on one advert exec conversant in these efforts.
“Based mostly on what I’m listening to from my shoppers, WPP Media is doing an honest job,” mentioned the advert exec. “OK, they’re not essentially aggressive however they’re making it clear they’re not going to be outmuscled by rivals on pricing.”
Granted, that’s not essentially central to the transformation Lesser envisions for WPP Media, but it surely issues. Particularly when the group’s information and AI pitch hasn’t but been examined in sustained, head-to-head battles with rival holdcos. And given the enterprise’s precarious spot, a win’s a win.
Revenues fell 4.3% within the first half of the yr, all the way down to £6.63 billion from £6.92 billion. The second quarter alone was down 5.8%.
For a corporation that also leans closely on media, these numbers level to one thing extra structural. WPP Media is overdue for a course correction.
The current losses of the Mars and Coca-Cola North America accounts alone have pulled an estimated $2.5 billion in billings from the enterprise, based on COMvergence — although WPP has additionally picked up roughly $1.4 billion to date this yr in new and retained shoppers.
“Any time you rework a enterprise as dramatically as we’ve got, you’re going to expertise some disruption,” mentioned Lesser. “We did see that within the first half however we’re considerably by means of that transformation.”
Perhaps. However the first half left scars. They usually’re nonetheless contemporary.
Simply weeks after entering into the CEO position, Lesser made waves when he informed Adweek “no human would contact a media plan inside 5 years”. The remark — meant to underscore WPP’s AI ambitions — rattled inside groups. The broader level was about creating new roles, not eliminating them however the message received misplaced. And it didn’t assist that months later, Lesser oversaw the merger of efficiency advertising and marketing unit Nexus with the funding workforce into a brand new group: Media Administration & Supply.
Internally, that transfer raised eyebrows, based on three separate sources. Some noticed it as an overdue elevation of Nexus. Others had been extra skeptical — studying it as groundwork for coaching AI techniques to finally take over elements of the media shopping for course of. The adjustments affected practically half of the enterprise in North America, and triggered a wave of senior departures.
“It’s honest to say that our principal contacts there aren’t snug with these adjustments due to that phrase “automation” — it’s so prevalent in every thing there in the meanwhile,” mentioned an advert exec, who works carefully with WPP Media.
The identical upheaval unsettling WPP Media’s North American groups is central to its world reinvention. It’s the market with the richest prizes — and a few of its costliest losses — making it each the jewel and the fault line in WPP’s transformation.
