Sorrell: Can he be the leopard who changes his spots?
The ad industry would love Sir Martin Sorrell to reinvent the agency model around collaboration and transparency, but Henry Daglish believes we’re more likely to see the birth of a mini WPP
There has been a lot of talk about what Sir Martin Sorrell might do with the £150m to £200m he has at his disposal at his new company S4 Capital.
Commentators are understandably amazed at how he has managed to raise so much money in just six weeks after resigning from WPP. Many are equally as optimistic that he can use the funds to reinvent the ad agency model, now he is freed of the baggage of running a massive holding company the size of WPP.
It would, of course, be wonderful if this were the case. What if Sir Martin realised that massive groups were not the way of the future and instead the answer is to incubate start-ups and small agencies that grow organically through encouraging innovation and collaboration?
What if he were to turn his back on opaque practices that benefit a holding company more than its clients and instead embrace transparency, being open with clients about where their budget goes and how those decisions were made?
The chances of this, I reckon, are close to zero. It’s a lovely idea but it isn’t going to happen because Sir Martin would have to turn his back on a process that has brought him incredible success over the past few decades.
Could a leopard change its spots?
Let’s not forget, Sir Martin is an accountant by origin. There is, of course, nothing wrong in that but it means he didn’t have a background in advertising and grew WPP by acquisition. He went out and bought large building blocks to piece together a massive holding company. His success in doing this is unparalleled.
It means growing collaborative start-ups and small independents just isn’t his thing. WPP’s strategy was always to have large agencies under an umbrella, all with separate P&Ls who made sure a client’s budget sloshed around the same holding company.
I’m not alone in arguing this serves WPP and the other holding companies more than their clients. How could one part of the organisation know that there wasn’t someone outside the firm better placed to carry out a piece of work? Why is the stock answer nearly always to employ a sister agency? And the massive rebates clients’ budgets bring in; where do those go?
Bountiful Cow’s view on transparency has been well-reported, so obviously I’m biased. We’re taking a big bet on tomorrow’s advertising landscape being built around companies working together transparently, fostering innovation and collaborating to deliver work that works, in a high-performance culture, and on projects that focus on what clients want to achieve. Clients are being held to account, and so should we.
So transparency isn’t a marketing trick, or a USP. It’s just a fact that this is what some clients want now, and what we think all will need in the near future: a break from the old-model that leads holding companies squeezing out extra work for themselves and prevent it from benefiting other agencies.
To tap into this new direction of travel S4 Capital would need a new worldview to that of WPP. Nothing Sir Martin has said thus so far suggests anything different.
Not large, but not small either
There has been a lot of conjecture about the direction Sir Martin will take S4 Capital in and far too much has been read in to his assertion that the company’s future will lie in content, data and technology.
That is an incredibly obvious statement that any media agency head could offer but it was taken to mean S4 Capital would take a totally different tack. I doubt it will. What has been described is basically what every media agency is trying to achieve. We all know how important data and technology is in digital marketing. Content is obviously hugely important in this; without it there is no advertising.
I’d suggest that S4 Capital will occupy a middle ground. It won’t be big enough to take on the holding groups and consultancies head on. On the other hand, though, he isn’t going to want to be a small company working to lofty ideas about collaboration and transparency.
He’s going to take the middle ground of being a smaller version of WPP. Too small to be a big player and yet too tethered to the existing model to change to a newer way of thinking.
Not that this will bother Sir Martin. If you were to consider what his main problem was at WPP, most would agree it was its huge size and how the parts didn’t always appear to fit. He built a massive train set and the engines didn’t always run that well on the same track. I suspect he’ll be happy to be running a smaller organisation. Make no mistake, though, it will still be a smaller version of a holding company, the chance of it being an exciting start-up incubator are close to zero.
Rehabilitation before retirement?
I suspect many people have been secretly wondering the same question of why the country’s most successful advertising entrepreneur would not leave the industry and enjoy a bountiful retirement. He has undeniably earned it.
As Mediatel columnist Dominic Mills suggests, Sir Martin probably found WPP to be a prison of his own making - too big to change. Perhaps he feels there’s enough time to have a crack at something else.
It begs the question of whether this retirement has simply been pushed back a little and, if so, does that means he feels he can devote more than, say, the next five years to his new project? That really isn’t a lot of time to grow organically. And he doesn’t have the big bucks to go out there and spend massively as he did at WPP.
This is why we’re going to have more of the same with S4 Capital but only in a smaller outfit that is still unlikely to embrace the transparency clients deserve nor the start-up joy of innovating and collaboration the industry needs.
Not so much a brave, new direction as a mini WPP.
Henry Daglish is CEO and co-founder of independent media agency Bountiful Cow