WPP Plc Chief Executive Officer Martin Sorrell said the global advertising market has cooled, partly because business was weaker in markets including Russia and Brazil.
Speaking in an interview at the Cannes Lions advertising awards festival on Thursday, the 70-year-old also said he questioned China’s real growth rate and indicated multinational companies may be having a tougher time there than local companies.
“Business is tough; it’s not easy,” Sorrell said. “GDP forecasts have been taken down and so have advertising forecasts.”
WPP, which owns ad agencies including Ogilvy & Mather and Young & Rubicam, said business in Germany and Spain was stronger and the U.K. was also performing well. He said the U.S. was “OK, but not vibrant.” The London-based company, which earlier this week announced it would form a marketing agency with the DailyMail.com website and Snapchat Inc., is making investments in content, data and technology its top priorities.
WPP shares declined 1.5 percent to 1,463 pence at 08:32 a.m. London time. The shares are up 8.8 percent so far this year, giving the company a market value of 19 billion pounds ($30 billion).
Next year’s Olympic Games in Brazil, the UEFA European soccer championship and U.S. presidential election should help boost worldwide advertising by 1 percent, Sorrell said. The automotive and telecommunications industries were spending well while fast-moving consumer goods were under pressure because of a lack of pricing power, he said.
He characterized business this year as similar to last year and said WPP will have spent between 500 million pounds and 600 million pounds on acquisitions in 2015.
Sorrell also commented on what he estimates is about $20 billion worth of ad spending up in the air as a number of big companies such as Coca-Cola Co., L’Oreal SA and Procter & Gamble Co. have put their media placement accounts in review. WPP has about a quarter, or $5 billion, of that total in review, Sorrell said.
“There are some large accounts coming available so it’s a big opportunity for us,” he said.