How COVID Impacted WPP's Media And Creative Agencies

WPP executives provided analysts with some numbers this week that illustrated the quarter-by-quarter impact that COVID-19 had on media spending during 2020.

CFO John Rogers disclosed that GroupM’s first-quarter 2020 organic revenue decline was 3%, followed by a nearly 19% free fall in the second quarter.

In the second half, GroupM, which includes Mindshare, MediaCom, Wavemaker and Xaxis, recovered somewhat, but was still in negative territory with Q3 and Q4 declines, respectively, of 3.7% and 4.1%.

Among the company’s big creative agencies, the best performer was VMLY&R, which rebounded into positive territory in Q4 with a nearly 3% percent gain. The agency was nearly flat for the full year. Wunderman Thompson was the second-best performer and CEO Mark Read declared those results supported the company’s decision to merge its big creative shops with digital agencies — VML with Y&R and Wunderman with JWT.

The company’s most recent major creative-digital agency consolidation, last November, was to merge Grey and AKQA into a new entity: the AKQA Group.



The firm’s other big creative shop, Ogilvy, remains “a little more challenged,” although the firm remains confident a turnaround is in the offing under the leadership of Andy Main, installed last July as CEO.

A separate opportunity, Read told analysts, is to consolidate retail media-buying operations into a scaled entity to match retail media-sales operations that are gaining traction at big chains, such as Walmart and Target. WPP was in the media sales end of that business with a firm called Triad. But a couple of its larger customers took their business in-house (including Walmart) and the operation was shuttered last year.

Next story loading loading..