WPP's Chief Executive Office Martin Sorrell on Thursday outlined the amount the advertising company spends on digital promotions ahead of its first-quarter results.
Sorrell said digital now accounts for 34% of WPP's media investment. The group spends $73bn globally on buying ad space across media from TV and press to Google and Facebook.
He said advertisers should think seriously about the amount they spend on newspapers and magazines and accused Google, Facebook and Twitter of being media owners masquerading as tech companies.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
"The two big [anomalies] are newspapers and magazines. We are still investing 20% [of client ad budgets] but consumers are only spending 7-10% of time. That has to change".
His remarks come a day before the company unveils its quarterly sales. Analysts expect sales growth of 2.5%.
Credit Suisse said it believed the agency was well placed to benefit from the digital transition in fees and margin.
"We like the diversified nature of their revenues and relatively high exposure to faster growing markets," the broker said Wednesday,
Analysts at Investec expect a strong cash return and dividend payment from WPP on the back of decent performance in emerging markets.
However, it also noted the weak first-quarter sales from WPP's rival Publicis.
"Recent poor 1Q Publicis like-for-like sales is unhelpful for WPP sentiment though we believe WPP should outperform given better geographic mix and Jan/Feb trading to date," Investec said last week. The stock was issued a 'buy' rating.
Friday April 26
INTERIM DIVIDEND PAYMENT DATE
Air Partner, Finsbury Food Group, Foresight 4 VCT, Henderson EuroTrust, Plexus Holdings, RIT Capital Partners, Smiths Group
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
GDP (Advance) (US) (13:30)
M3 Money Supply (EU) (09:00)
Personal Consumption Expenditures (US) (13:30)
Personal Income (US) (13:30)
Personal Spending (US) (13:30)
U. of Michigan Confidence (US) (15:00)
IMSS
Rotork
AGMS
Aer Lingus Group, Alpha Pyrenees Trust Ltd., Churchill China, Espirito Santo Financial Group SAMinoan Group, New World Resources A Shares, OAO Severstal GDR (Reg S), Pearson, Rotork, Senior, Stadium Group
TRADING ANNOUNCEMENTS
WPP
FINAL DIVIDEND PAYMENT DATE
Access Intelligence, Argo Group Ltd., Charlemagne Capital Ltd., Moneysupermarket.com Group
SEGRO, Space and People, Tamar European Industrial Fund Ltd.
RD
-
RICS: Housing market continues to strengthen but 2025 could be challengingThe latest survey by the Royal Institution of Chartered Surveyors reports a resilient UK housing market, but warns of headwinds next year
-
Bitcoin price one of the most-asked questions on Alexa - here's how to buy the cryptocurrencyAccording to figures from Amazon, which cover September 2023 to November 2024, pop star Taylor Swift and Bitcoin were named among the most popular Alexa queries of 2024
