Speaking in an interview with the Wall Street Journal, WPP chief executive Sir Martin Sorrell outlined plans to increase marketing services overall to account for two-thirds of its business, while direct and interactive he wants to see account for half.
Direct marketing has grown 22% in the last two years and is now worth 拢10bn according to the DMA. During the downturn, firms have turned to direct activity as they look to measure results more effectively.
Recent reports, including IPA Bellwether Reports, have all confirmed a continued shift by advertisers away from traditional brand-building advertising towards direct marketing and sales promotion.
Consequently, the direct industry has suffered far less than other sectors such as public relations and public affairs.
"A company that is broader is more resilient. Our market research side of the business has withstood the recession better. Branding and identity has been hard-hit, but healthcare hasn't. Public relations and public affairs have failed to weather the recession as much as we thought it would, but direct marketing has continued to be quite strong," Sir Martin said.
WPP has made a number of acquisitions in the last year to strengthen its direct operations, including buying customer relationship firm QCI, taking a stake in Japan's largest data services company Landscape and acquiring one of China's top independent direct marketing firms BrandOne.
In the interview, Sir Martin also said WPP intended to continue to cut its reliance on the US by reducing it from 45% of WPP's business to one-third, with Europe and Asia/Latin America making up for another third equally.
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