Sir Martin Sorrell: ‘Brands are starting to question if they have over-invested in digital’

Sir Martin Sorrell expects further admissions that brands have over-invested in some areas of digital after Procter & Gamble said it went too far in targeting consumers on Facebook.

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WPP’s CEO Sir Martin Sorrell expects growth in digital ad spend to slow over the next few years as concerns over viewability, ad fraud and measurement impact budgets.

Speaking on the company’s earnings call this morning (24 August), Sorrell said brands are increasingly questioning their digital ad spend. He cited the example of Procter & Gamble, which is planning to cut investment in targeted Facebook advertising after admitting it went too far.

He explained: “What has really been happening is questioning digital growth. One of our major clients has talked about investment in Facebook and reducing that, not overall but investment on particular areas of activity.

“We have seen this before in arguments about viewability, ad fraud and measurement issues, not forgetting ad blocking. That is where the debate is.”

“Some clients are looking at whether they have over-invested in some new media alternatives.”

Sir Martin Sorrell, CEO, WPP

Read more: Why P&G is moving away from targeted Facebook advertising

This has come, Sorrell said, because chief financial officers, procurement officers and media auditors are all increasingly asking for better metrics on the effectiveness of digital. He said digital now makes up on average 30% of brands’ budgets but for spend to increase further the likes of Google and Facebook will need to provide better measurement tools.

“We and our competitors want better measurement, not just offline but online too. The answer is not Facebook or Google data, we can’t have the players being the referees. There has to be independence in terms of measurement, that is a critical issue,” he added.

He also believes marketing trade bodies should be holding Google and Facebook to account. Sorrell said that although the ANA has investigated media transparency, it is not looking into issues such as Google changing its algorithm or Facebook altering what content appears in people’s news feeds.

“We hear [traditional] media owners complaining quite bitterly that [Google’s] algorithm changed and no one could explain why and how, yet this is the transparency era,” he commented.

Festival

Sir Martin Sorrell will be opening the Festival of Marketing, which is running on the 5 and 6 October at Tobacco Dock, London. For more information about the event, including how to book tickets, click here.

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Comments
  • clickworkmedia 29 Aug 2016 at 3:37 pm

    He could start by learning the distinction between communications, marketing and advertising. He could then progress onto understanding that there’s a distinction to be drawn between strategy and tactics.

    • joelhopwood 13 Sep 2016 at 9:21 am

      Imagine how successful he could be if he did that

  • Babar Khan 2 Sep 2016 at 5:24 am

    Totally agreed. But lets remember the limited sample sizes taken by research firms to ascertain viewership numbers of traditional TV as well and wonder when the industry will update its tracking capabilities.

  • Jaclyn Patton 2 Sep 2016 at 7:49 pm

    Not all digital advertising is created equal either. There’s a certain place for FB ads, but if thats ALL youre doing, you are missing a significant portion of the population, and possibly not even reaching your target consumers at all.

  • Dominic Liang 4 Sep 2016 at 8:47 am

    The one take away is for an independence of measurement and that is the real state of affairs. Every activity demands KPI reports which are different for each channel and that’s the point where we need to simplify the same for other non digital stakeholders such as the Finance and Procurement teams. That’s where the pain points occur and we see endless discussions happen distinguishing between a good v/s bad performance.

  • Adey J 14 Nov 2016 at 11:37 am

    This shows quite how much media groups associate annoying, flashy click-me mass spam = digital. Shame on you.

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