WPP Group plc takes serious earning dump

August 26, 2009

Advertising Agency WPP Group plc published their earning results, and it’s ugly.. really ugly. Revenue is down 8.3% earnings are down a mind boggling 47% and to make matters worse “Digital” Takes Bigger Slice Of super shrinking WPP Pie, Accounting For a full 25% of total revenue. We say worse because WPP group plc doesn’t actually do Digital, The companies they hold GroupM, Outrider, 24/7 Real Media, and media shops such as Mindshare, Mediaedge:cia and MediaCom are not “digital” firms as per say. Most of the revenue is just online media buys. For example WPP group plc has very limited access to SEO talent and very limited access to Social Media Talent.

Leaving their “digital” assets mostly addicted to flash based websites and Google Pay Per Click.

That’s not digital, not by a long shot. On January 1st 2009, we published an article defining digital here we are nearly 1/2 a year later and WPP group plc epic fails on that definition.

Having a bunch of guys and girls sitting there running clients credit cards though Google’s Adwords isn’t actually digital.. but that is pretty much what they define digital as hence why their total revenues are down and Google Adwords related work now accounts for such a huge percentage of their ever declining revenue.

Sir Martin, Digital isn’t Pay Per Click, Digital is when you are reading this blog post. If you don’t understand the difference think about the trail on how you found this article.

clown

Related Posts:

Comments

  • Andrew

    Well said The Founder…all my compliments, and not only from me…
    Keep “all” of us posted.

  • Andrew

    Well said The Founder…all my compliments, and not only from me…
    Keep “all” of us posted.

  • Matt

    To the author: if you think that SEM (search engine marketing aka Pay Per Click) is not considered Digital, you have no idea what you are talking about. Digital isn’t Pay Per Click? Have you lived under the rock for last ten years???

    Digital: SEM, SEO, Display, Email, Social, Mobile, Podcast, Video etc

    As you can see, Digital is both direct response and branding…

    Where did you come up with an idea that SEM is not Digital?

  • Matt

    To the author: if you think that SEM (search engine marketing aka Pay Per Click) is not considered Digital, you have no idea what you are talking about. Digital isn’t Pay Per Click? Have you lived under the rock for last ten years???

    Digital: SEM, SEO, Display, Email, Social, Mobile, Podcast, Video etc

    As you can see, Digital is both direct response and branding…

    Where did you come up with an idea that SEM is not Digital?

  • http://www.tribbleagency.com/ TheFounder

    SEM is a nothing more than a media buy… you think that is digital work?

    Seriously you think coming up with a text ad, running a credit card.. and measuring is digital? You think that is digital?

  • http://www.tribbleagency.com TheFounder

    SEM is a nothing more than a media buy… you think that is digital work?

    Seriously you think coming up with a text ad, running a credit card.. and measuring is digital? You think that is digital?

  • Matt

    Absolutely

    Display and SEM are digital media buys, classified under Digital advertising - where else should they belong? I think you created your own classification, which does not reflect what 99.99% of ad / communications people mean by digital.

    And, where did you come up with the credit card thing? WPP’s big advertisers’ spend millions of dollars on SEM, and trust me, it is not done with a black AMEX.

    Digital advertising refers to advertising done on digital media (simple and plain definition, isn’t it?) - and SEM is both media buys and creative work (somebody actually writes the creative for the search ads or online banners).

    If by saying digital, you mean stuff like web design, then we are on a different page as WPP is a communications agency, not a web developer shop.

    Cheers

  • Matt

    Absolutely

    Display and SEM are digital media buys, classified under Digital advertising - where else should they belong? I think you created your own classification, which does not reflect what 99.99% of ad / communications people mean by digital.

    And, where did you come up with the credit card thing? WPP’s big advertisers’ spend millions of dollars on SEM, and trust me, it is not done with a black AMEX.

    Digital advertising refers to advertising done on digital media (simple and plain definition, isn’t it?) - and SEM is both media buys and creative work (somebody actually writes the creative for the search ads or online banners).

    If by saying digital, you mean stuff like web design, then we are on a different page as WPP is a communications agency, not a web developer shop.

    Cheers

  • http://www.tribbleagency.com/ TheFounder

    I have to disagree with you. I think it’s just a media buy.. not even really a digital one at that.. considering up until last year people were using it to buy print media and TV spots as well on Adwords.

    The Credit Card thing is just a fact… yea it may not be a black Amex… maybe it’s a invoice… but does it matter… it’s just running the clients money into Google adwords.. the delivery method of the cash doesn’t really matter does it?

    “Digital advertising refers to advertising done on digital media (simple and plain definition, isn’t it?) ”

    That is where we differ. Digital isn’t just advertising on digital media. Digital means making blog posts (like this one) and people reading it… How would you classify Social Media then? That’s digital.. and no money is forked to Google… or a killer blog post that sees 20,000 visitors an hour because it hit page 1 of digg.

    That’s digital… the black amex card isn’t.

  • http://www.tribbleagency.com TheFounder

    I have to disagree with you. I think it’s just a media buy.. not even really a digital one at that.. considering up until last year people were using it to buy print media and TV spots as well on Adwords.

    The Credit Card thing is just a fact… yea it may not be a black Amex… maybe it’s a invoice… but does it matter… it’s just running the clients money into Google adwords.. the delivery method of the cash doesn’t really matter does it?

    “Digital advertising refers to advertising done on digital media (simple and plain definition, isn’t it?) ”

    That is where we differ. Digital isn’t just advertising on digital media. Digital means making blog posts (like this one) and people reading it… How would you classify Social Media then? That’s digital.. and no money is forked to Google… or a killer blog post that sees 20,000 visitors an hour because it hit page 1 of digg.

    That’s digital… the black amex card isn’t.

  • Matt

    hmmm

    let’s leave it at that then….

    My last comment:

    ” eMarketer projects nearly $12 billion will be spent on US search advertising in 2009, almost 49% of the total US online ad market. ”

    Better don’t disregard search so quickly, it will be years before companies will be willing to pour more money into blogging and social media, and it will rather fall into PR activity. Search is there to stay and it is where advertising dollars go.

  • Matt

    hmmm

    let’s leave it at that then….

    My last comment:

    ” eMarketer projects nearly $12 billion will be spent on US search advertising in 2009, almost 49% of the total US online ad market. ”

    Better don’t disregard search so quickly, it will be years before companies will be willing to pour more money into blogging and social media, and it will rather fall into PR activity. Search is there to stay and it is where advertising dollars go.

  • http://www.tribbleagency.com/ TheFounder

    I’m not disregarding Search at all… in fact I always strongly push SEO .. in turn that means I have to strong push Social Media.. because SEO is worthless if people don’t link to the content.

    I’m just not a big fan of the “our marketing plan consists of my client’s black AMEX card given to Google Adwords”

  • http://www.tribbleagency.com TheFounder

    I’m not disregarding Search at all… in fact I always strongly push SEO .. in turn that means I have to strong push Social Media.. because SEO is worthless if people don’t link to the content.

    I’m just not a big fan of the “our marketing plan consists of my client’s black AMEX card given to Google Adwords”