Ad exec: Global approach required of TV biz
WPP's Martin Sorrell delivers MIPTV addressCANNES -- The one-two punch of the global recession and the new-media revolution will radically change the way producers and distributors operate, Martin Sorrell, chief executive of global advertising agency WPP Group told a packed auditorium of industry execs Tuesday at confab MIPTV.
Outlining his take on the state of the industry, Sorrell said that a global, multiplatform reach is increasingly important and will prove essential if companies hope to weather the current economic storm and come out stronger.
"If I was a media owner, and in particular if I was in one medium in one country, such as ITV in the U.K., I would be very nervous," Sorrell said. "While (Italy's) Mediaset is a good example of a company that used to be in one country and one media but successfully expanded -- first to Spain buying Telecinco and then diversified into content with (the acquisition of) producer Endemol."
Sorrell predicted the global downturn would continue throughout 2009 and the recovery in 2010 would be "pretty anemic" but was more upbeat about prospects in developing countries.
"Latin America, particularly Brazil, is defying gravity at the moment. China and India have been touched by the downturn and growth has slowed but there are signs that China is speeding up again. The decline in Russia is quite significant but even there, there remains some vibrancy," he said.
Sorrell said the recession might have the greatest effect on production, with content producers being forced to trim costs and be more creative in financing their programs.
"Production models are too expensive and will have to change," Sorrell said, suggesting more partnerships between ad agencies, talent and content producers will be the wave of the future.
"This is actually a big opportunity for content producers, who those who control talent and for the agencies," he said. "These groups have to work together to try and develop content that is attractive for the new platforms, particularly the growth platforms of mobile and the Internet."
Sorrell ended on a note of optimism, saying companies that invest counter-cyclically will benefit most from the eventual recovery.
"All our numbers show this, that the companies that invest in content in times of recession do better," he said, before adding wryly, "but no matter how often you say that, no one ever does it."