Adland Braces For Sorrell's 'Deep Doo Doo'

The prediction makes for such bad reading that Sir Martin Sorrell has described holding companies, apparently including the one he is famed for setting up, as being in "deep doo-doo."

AA/Warc figures had predicted a 5% increase in advertising spend this year. Instead, today's figures forecasts a 16.7% drop. For an industry that has only been accustomed to seeing growth since for the decade following the immediate aftermath of the global financial crisis, this is shocking stuff. 

While digital display and search are set to slightly buck this trend and decrease by around 12%, it is worth sparing a thought in all of this for the most affected channels. The demise of print has been written about many times in this column way before today's shocking news that AA/Warc predicts magazines will see ad revenue drop by a quarter. Newspapers are due to see ad spend go down by a fifth. 

The channel taking a really bad hit is cinema. The figures suggest ad spending on the big silver screen will be reduced by a third this year. 

To put the downward figures into perspective for digital, the latest IAB UK figures had shown that digital advertising had seen an increase of more than 15% last year.

For AA/Warc to suggest the two huge channels of search and digital display to go down 12% this year, that really is a massive swing away from growth. 

Sir Martin Sorrell's "deep doo-doo" comment came in an interview paraphrased in Campaign in which he talks of a Darwinian shakeout of advertising.

The small, nimble, digital agencies will see opportunities, he suggests, while the huge holding companies, he believes, are too large and "too analogue.". Agency groups need to get away from their analogue past, he insists, and "blow things up."

He finishes with the well-used analogy that if you don't disrupt, or "eat," your own business, then you will instead get eaten.

WPP bucked a recent trend for holding groups to delay Q1 revenue announcements with a statement that globally revenue was down 3.3%.

Where COVID-19 had already struck, China, revenue was down more than a fifth. That will be a very unsettling prediction of how dramatic the drops in advertising revenue will be in the US and Europe in Q2 and beyond.

It is probably little wonder, then, that when "Campaign" asked British ad execs when they expect growth to return, the previously hoped-for answer of Q4 was only selected by a quarter of respondents. Three in four are now accepting there will be no return to growth in 2020. In fact, nearly half don't expect a hint of growth Q2 next year or after.

There is no sugar-coating this. Even the golden children of digital marketing -- search and digital display -- will see drops like we've not seen in a decade. "Deep doo-doo" indeed.

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