WPP boss Mark Read said the empire built by his predecessor had become too unwieldy
WPP’s boss has called for a radical overhaul of the group as he seeks to move on from the reign of founder Sir Martin Sorrell.
Just 24 hours after he was made chief executive, Mark Read said the advertising empire built by his predecessor had become too unwieldy and needed to revamp its image to attract talented young recruits.
The 51-year-old also insisted the world’s largest ad agency was not in decline and was well-placed for a fight back against consultancies and Silicon Valley firms which have eaten into its business.
But his comments came as the challenge facing the company was laid bare, with a return to sales growth overshadowed by a squeeze on profits and lacklustre performance in America.
Spooked investors sent WPP’s shares down more than 6 per centr, or 80p, to 1196.5p, wiping £1billion off the firm’s value.
Shares have lost more than a third of their value since early last year.
Read said he did not want a wholesale break-up up of WPP’s 400 companies. But in a sign changes are afoot, he blamed problems in America, where he has spent much of the summer, on a lack of talent.
He said the firm needed to attract more of the millennials flocking to tech giants such as Google and Facebook.
This was partly why WPP’s London offices were moving from Mayfair to a more modern site on London’s South Bank, he said, also pointing to a reorganisation in Portugal which saw 30 of the group’s offices consolidated into one building housing 600 staff.
Read said: ‘If we look at the parts of the business that are not performing as we’d like them to, talent is, in many cases, at the heart of it.
‘So we need to make WPP a destination for the millennial talent that is going to Google and Facebook. We can be a much more modern, contemporary company.’
WPP owns some of the biggest names in advertising, including JWT, Ogilvy, Grey and Y&R, employing some 130,000 staff worldwide. But it has been hit by changing attitudes in the industry, with more clients buying internet advertising from Google and Facebook.
Many of WPP’s customers have also called for it to simplify its structure so that its various agencies work better together.
Sales grew by 2.4 per cent in the three months to June 30, its first quarterly growth since the start of 2017, but it lowered its profit margin forecast for the year.
There was also a 7.4 per cent drop in profits, to £735million, when the one-off sale of its software business Globant was stripped out.
Read, whose appointment followed Sorrell’s exit in April, said he would spell out details of his turnaround plans for the group by the end of the year.