LONDON (Reuters) – Despite the sluggish economy, the world’s largest advertising group WPP is seeing increasing marketing spending by its customers and is also confident about 2023.
In the current year, adjusted sales should grow by three to five percent, the company announced on Thursday. “The prospects are pretty good. Customers tell us that they want to keep investing in marketing,” CEO Mark Read told Reuters. With this optimism, the owner of the agencies Ogilvy, Gray and GroupM has exceeded the expectations of many analysts, who had expected companies to be more cautious about advertising due to the economic situation. Marketing spending is seen as a gauge of corporate sentiment and the economy.
Last year, adjusted sales rose 6.9 percent, which was at the high end of the 6.5 to 7 percent growth forecast. “There was some concern that customers would stop spending in the fourth quarter, but we actually grew 6.4 percent and even accelerated growth a bit,” Read said. French rival and advertising giant Publicis was similarly optimistic earlier this month.
WPP justified the development with the increased marketing opportunities for customers, such as TikTok or the introduction of advertising on Netflix and retail platforms. With companies such as Audible, Danone, SC Johnson and Verizon, the group has brought in 5.9 billion dollars in new business. For the China business, one of the company’s largest, Read expects growth in the second and third quarters after the tough corona measures were lifted. China was the only major market at WPP to see a drop in adspend in 2022 due to lockdowns.
The confidence of the advertising giant was well received on the stock exchange: the shares climbed by 6.4 percent at the top. In the last six months, the papers have increased by more than 30 percent.
(Report by Kate Holton, written by Philipp Krach; edited by Sabine Wollrab. If you have any questions, please contact our editorial team at [email protected] (for politics and the economy) or [email protected] (for companies and markets).)
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