More than 100 WPP agency leaders will be present to see Mark Read take charge of the group’s annual strategy meeting for the first time when they gather at a hotel in Brooklyn, New York on Monday evening.
After last week's demonstration of how ruthless Read is prepared to be, some of them may wonder if they will still be in their jobs in a year’s time.
August creative network Y&R was fused with much younger digital experience shop VML, with much of Y&R's management, including its whole leadership team in London, abruptly ousted.
Cambridge- and Harvard-educated Read, 51, has shown that he understands the importance of breaking with the past.
He and Andrew Scott, the chief operating officer, have already decided to move WPP's headquarters from a mews house in Farm Street—his predecessor Sir Martin Sorrell’s prized home for 30 years—to Sea Containers, the recently modernised, London base of Ogilvy and Wavemaker. The relocation is happening this weekend.
For many WPP insiders, the beginning of the end for Sorrell was apparent around the time of the company’s last strategy meeting in Silicon Valley in September 2017.
WPP’s revenue growth had hit a brick wall, the share price had dropped by a third and the group was struggling to reorganise itself, after acquiring hundreds of agencies.
Read, who was appointed chief executive in September after a five-month search, has started in his new role with the benefit of being an insider.
He first joined WPP in 1989 and knows exactly how WPP and the ad industry works.
The former global chief executive of Wunderman and WPP Digital has already pushed a different, more progressive agenda than Sorrell, his one-time mentor.
"He is in every way a 21st-century CEO," Roberto Quarta, the chairman who appointed Read, says.
Read wants to make the group simpler to navigate, get closer to clients by co-locating different agency teams and placing staff in client offices (rather than fight the trend for advertisers to bring marketing services in-house), attract "millennial" talent and get closer to technology giants such as Adobe, Google, Amazon, Microsoft and Facebook.
Still, Read needs to persuade some long-standing WPP agency leaders with big egos that they should fall behind him. The three-day strategy summit in Brooklyn could be an important test.
Read also has to convince investors that he can return the company to growth at a time when clients and the agency holding company model itself face immense structural changes.
He talks about "radical evolution" at WPP, so this begs the question: just how radical do observers think he could be?
The story at Wunderman
Read’s template for change at WPP looks like it will draw heavily on his experience running Wunderman for the past three years, where he put radical evolution into practice.
His mantra at Wunderman was to be "future-ready". He took a direct marketing and CRM shop with nearly 60 years of history and turned it into a digital experience agency with data, consulting and e-commerce capabilities to take on Accenture, Deloitte and Sapient.
Read’s empire grew as it absorbed digital agency Possible and e-commerce shop Salmon through internal M&A and also acquired consulting group The Cocktail.
Mel Edwards, who worked at Wunderman before Read joined, ran the EMEA region and has now succeeded him as global chief executive, says: "Mark has been clear from the beginning: set a vision and stuck to it.
"He’s grown Wunderman over the last three years and broadened it to provide an end-to-end digital offering to our clients.
"He puts himself in the client’s shoes a lot, which has helped us as a business. And with clients themselves, he’s very hands-on."
She adds that Read is "always fair and considered" and "not hierarchical".
Winning over clients
Clients like Read's direct approach. Zaid Al-Qassab, chief brand and marketing officer at BT, says: "Mark’s always impressed me with his understanding of clients, the industry and with his personable nature. He’s not in any way what you’d consider a corporate type and it shows in how he tackles problems and build relationships.
"On the day that Martin resigned, Mark called me personally as soon as it was on the Today programme to say: 'Please don’t worry, the rest of us are still in place, we will navigate through this thing.'"
Chris Duncan, managing director of Times Newspapers and former chief marketing director at parent company News UK, describes Read as "very smart and future-focused", noting how he helped Wunderman and other WPP agencies to adapt their working model to suit News UK’s needs and bring staff "on site" in the client’s office.
"Mark has been part of various WPP configurations over the years with us, putting together group solutions that were on premise [in the News UK building], with multiple players and some difficult internal negotiations to be had," Duncan says.
"He always has been a great listener and a problem-solver for News UK at times when that meant WPP had to invest to grow the business."
Another client who uses a number of WPP agencies, including Wunderman, says: "Wunderman under Mark Read is one part of WPP that did buy businesses but worked out how to integrate them, move them into Wunderman, present together, work for the client together, rather than just buy lots of businesses."
Several people outside WPP have sometimes found Read to be distant and even aloof, but he knows how to turn on the charm.
One CMO who wasn’t a Wunderman client but went on to appoint Read’s agency recalls: "Mark said: 'Let’s go for a coffee, I really want to see you.' I said: 'I’ve not got any tenders in the works, so you’re wasting your time with me.'
"He said: 'It doesn’t matter—I want to tell you about Wunderman and what we do, and one day you’ll come to us.' I had a quiet coffee with Mark, he presented a few slides and creds. That led to me putting them on the tender 18 months afterwards.
"It was a shrewd move. It was the global CEO of Wunderman coming to see me himself; not a new-business person sending me an email. It was unusual.
"He was far-sighted and interested in building the right relationship. He wasn’t at the pitch, but he continued to be involved and meet me and call me."
Those who work with Read say he has continued to adopt the same personal approach since he took over from Sorrell.
Read is said to have flown to Dearborn, Michigan, at least five times over the past six months to woo Ford, WPP’s biggest client, which is carrying out a major global review.
Restructuring WPP
Simplifying WPP is a huge task after Sorrell built the world’s biggest ad group through hundreds of acquisitions. Read announced a strategic review in September that will conclude by the year end, but he is not using external management consultants, preferring to rely on Scott and a few other lieutenants.
He has already signaled a number of initiatives, such as co-locating staff in the same building (WPP moved from 20 offices to one in Lisbon) and is pushing for more agency teams to embed "on site" in clients’ offices and to use technology more consistently across the group.
Lorna Tilbian, the top media banker in London for 30 years, uses a gardening metaphor to describe the challenge for Read, saying he is right to cut back.
"It’s a bit like pruning something so it grows," she says. "He’s selling some things [such as its Globant stake and possibly Kantar] that pay down debt, and merging and integrating other things [such as VMLY&R] to help with the performance.
"Martin started it [before he left], but Mark is doing it faster and is talking about it."
Still, Read hasn’t yet articulated what the overarching structure for the group should look like—as, say, Arthur Sadoun and his predecessor Maurice Lévy have done at Publicis Groupe.
More internal mergers at WPP are likely. Sorting out ailing J Walter Thompson, possibly by merging it with Wunderman, has been heavily rumoured, and Ogilvy must be a worry after suffering an exodus of staff in London.
Read has warned that creative agencies are hurting the most, although he ruled out a merger of two creative shops or a tie-up between a creative agency and a media one. He previously said in March that merging media and data makes more sense.
One client warns: "Mark’s biggest challenge as CEO will be dealing with his previous peers.
"He’s probably going to have to make some pretty radical changes to the structure of different parts of the business, which are currently led by people who were his peers. That’s going to be difficult."
Tilbian says returning to growth by making major acquisitions is not realisitic. "The share price is so low and the debt is too high," she points out.
The £15 billion group has £5 billion of debt and its share price stands at £11, having fallen back over the summer to the level when Sorrell exited—and a long way off its £19 peak in March 2017. At least three hedge funds have taken out short positions against WPP.
Even if Read wants to buy something, there isn’t much that he could acquire that could have an immediate impact, according to Tilbian.
"The things that clients want can’t be easily bought," she says, pointing out that brands want a more agile, flexible and consultative approach from agency partners. "Read has got to re-engineer what they do and be more agile and nimble. It’s turning from elephants to gazelles. Gazelles move faster."
A radically different view about the status of advertising?
Read was blunt at his first investor presentation as chief executive in September, when he said creative agencies were facing a "fundamental" shift because clients want a more "experience-led" rather than "brand-led" approach.
He cited how Wunderman, rather than JWT, led the successful defence of the Shell creative review earlier in the year.
Read has hinted that a career in marketing services might have to be different, because it will no longer be so lucrative and the services that clients prize are no longer focused on making 30-second TV spots.
VMLY&R has its headquarters in Kansas City, on the site of a former provincial airport in the plains of the American Midwest, not in the heart of Manhattan next to Central Park, like Y&R.
Wunderman recently won a piece of business that involves putting 15 people in an office in Chertsey, a small town about 30 miles from central London.
Working in some of these locations is "not going to be quite as glamorous as Soho" in central London, but it requires a different mindset—something that new entrants such as Accenture are happy to embrace and wouldn’t worry about, Read told investors.
When WPP’s stock market value has lost £8 billion in 18 months, a fancy office such as JWT’s London home, opposite Harrods, in London’s Knightsbridge looks a lot like an extravagance.
A family man from the Home Counties
Mark Julian Read, the son of an entrepreneur and an orthodontist, was born in November 1966 and grew up in Kingswood, Surrey, a leafy and prosperous village just outside London.
He was smart, studying economics at Cambridge and winning a scholarship to Harvard at the same time that Sorrell was just beginning WPP’s global acquisition spree.
Read wrote to Sorrell asking for a job, got an interview and started, aged 22, in Farm Street as a corporate development executive, just as WPP bought Ogilvy & Mather.
Those early years were dramatic, as WPP went from boom to almost bust in the 1990-1991 recession and, as the share price crashed, Read was among the small team who would handle investor relations.
He knows what a real crisis is like and how to deal with shareholders.
Read broke away from WPP before he was 30, studying at business school Insead, doing a spell at management consultancy Booz Allen Hamilton and running an online start-up, WebRewards, during the first dot-com bubble.
He returned to WPP in 2002 with digital savvy, joined the board as strategy director in 2005 and spent the next decade helping to buy assets including 24/7 Real Media and AKQA.
Moving to Wunderman was a watershed moment, when he finally moved out of Sorrell’s shadow.
When Campaign interviewed Read last year about whether he’d like to succeed Sorrell, he replied: "I wasn’t aware there was a vacancy." But there’s no doubt that he wanted the job and looked a racing certainty to get it when Sorrell departed, despite Quarta talking to other candidates over the summer.
Sarah Golding, president of the IPA and chief executive of The & Partnership London, a joint venture in which WPP has a 49.9% stake, counts Read as a friend and believes he will rise to the challenge of succeeding Sorrell.
"He’s young but experienced, puts smart over schmooze and is the sort of steely decision-maker needed to drive real change," Golding says. "On a personal note, Mark has the right moral code but enjoys life with a mischievous glint in his eye."
Another friend says: "He doesn’t do flamboyant but he’s great company and immensely engaging. He is very loyal personally and professionally. While he could have taken a big tech job, he’s stayed true to WPP and he wants to change its fortunes.
"His academic credentials are impeccable; he has a first-class brain. He’s incredibly balanced and, while he likes debate, he doesn’t like to see anyone being bullied or singled out. He’s passionate about bringing about gender balance. I think we will see a lot more of this in WPP going forward."
Read likes wine and skiing and "adores family life", according to this friend.
He is married to Sinead, who is said to keep her jet-setting husband grounded, and they have two children, Emilia and Fred, both aged under 10.
Sinead studied at Oxford and the pair met through friends when she was working at Shell in supply chain management. She is now a philanthropy advisor and "a terrifying kick-boxer" in her spare time "who doesn’t take any prisoners", a friend says.
Despite working at WPP for more than 20 years in total, Read only owns 128,500 shares, which are worth about £1.5 million.
He will earn £975,000 plus potential bonuses worth up to six times his salary—a potential £7 million package, including benefits, that is significantly lower than Sorrell’s previous deal.
Moving out of Sorrell's shadow
Sorrell left WPP after an investigation into allegations of personal misconduct, which he denied. Since then, he has not been making life easy for his successor.
The former WPP boss has claimed that the five-month search for a new chief executive was "a complete waste of time" and suggested that it would be better if Read and Scott, both of whom he mentored, should be co-CEOs together.
Sorrell has also launched a new marketing services business, S4 Capital, because his WPP contract had no "non-compete" clause, and he outbid WPP for Dutch creative production company MediaMonks in July.
Read has been careful not to retaliate, but it is hard to believe the criticism does not sting.
It might just spur on WPP’s new chief executive to be more radical.
