Boss of the world’s biggest media company, WPP CEO Sir Martin Sorrell, has again reconfirmed that the advertising industry has little to fear from consultancy firms, namely because these new interlopers don’t understand digital.
Speaking at UBS’s Annual Global Media and Communications Conference in New York on Monday, Sorrell said digital was the fastest growing part of the advertising business and the consultancy firms didn’t, as yet, possess the know-how to compete.
“I don’t think that head-to-head on digital, the consultants currently win,” Sorrell said. “You can’t buy creativity, you can’t buy digital capabilities.”
Sorrell has led the chorus of traditional advertising people fighting back agains the likes of Deloitte, Accenture and KPMG – all typically advisory firms – who want to use their client networks and data stacks to start playing in the advertising space.
Unfortunately for Sorrell, the consultancies appear to know the expertise they’re lacking and are increasingly hiring staff from the media space.
However, Sorrell did acknowledge that the consultancies did have a strategic and tech savviness to cajole clients their way.
For many years now consultancies have used technology to drive costs from their clients’ businesses. It’s now widely thought they now need to start adding back, hence the foray into the ad space.
Sorrell added: “Where I do think the consultants have made headway is on the general proposition that if you’re the CEO of a company, you’re currently spending too much. And in a low growth world where there is no inflation, there is no pricing power, and there is a focus on costs, that is an extremely seductive proposition.”