"Almost without exception the large holding companies have legacy infrastructure, processes and cultures that were all built before the internet while their clients have demonstrated more agility in transforming themselves. Frustrated by agencies' slowness to respond, clients are increasingly embedding agencies internally, (for example, Oliver and Unilever), or subsuming their workload (for example, P&G). What clients need more than ever, however, and are not getting from their agencies, is one strategy and one idea."
"Sorrell was a visionary architect, a man who took years to create a revolutionary agency model, based on the supermarket style concept of offering clients everything they need under one roof. The WPP model has now found its greatest challenge in shifting client demands and expectations and in addition is facing other significant challenges: reduced budgets, disruption through disintermediation, new competitors like Google in digital advertising, and consulting services like Accenture and Deloitte in the field of business transformation."
There are six global advertising brands, including WPP, with increased ad-market share worth tens of billions. Mega ad groups grew, but the peak of the mega ad-group model has passed. Large holding companies retain legacy infrastructure, processes, and cultures built before the internet while clients have shown greater agility in transformation. Clients are embedding agencies internally (for example, Oliver and Unilever) or subsuming agency workloads (for example, P&G). Clients require one strategy and one idea rather than separate channel strategies. Erosion of trust from recent digital media scandals further undermines larger agencies. New competitors include Google and consultancies such as Accenture and Deloitte.
Read at The Drum
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