Turkeys don’t vote for Christmas. That was Sir Martin Sorrell’s summation of agency trepidation to fully embracing AI in a wide-ranging talk at SXSW Sydney.
“In two, three, or four years, the sensitivity to using artificial synthetic material [among consumers] will be reduced. I would say the biggest resistance point is [that] turkeys don’t vote for Christmas,” he said.
“There is a lot of fear and concern about the employment question… This is about change management.”
Sorrell recounted an anecdote to the crowd about a McKinsey consultant who became the CEO of Best Buy with a plan to transform it from a traditional bricks-and-mortar retailer to a digital retailer.
“People keep telling him it’s about change management. He spends the first six months looking at the problem and he realises it is about change management, so he changes the management… In order to get this done at scale, you have to break some eggs. That’s the biggest blocker that we see, the traditional ways of doing it,” he said.
“In companies you have separation between ownership and control. By and large, listed companies are not entrepreneurially controlled or run. There is a resistance to change. Unless, as you see in the automotive category or in financial services, there’s an external economic force that is pushing them forwards. My view is that when we get into 2026 and general economic conditions are not quite as good, maybe when we get to the American mid-terms next year when Trump is less concerned about making sure that the economy is strong, maybe we’ll start to see that economic pressure intensify and then people will have no choice but to implement AI and become more efficient.”
Sorrell, of course, was the founder and CEO of WPP from 1985 until 2018, becoming the longest-serving chief executive of any business on the UK’s FTSE 100 in the process.
He was succeeded by Mark Read, promoted internally from Wunderman (before it added the Thompson and merged with VMLY&R to create VML) and WPP Digital. In 2018, Read’s announcement focused on creating a culture that attracts the best people. But he also added the following:
“Our industry is going through a period of structural change, not structural decline, and if we embrace that change we can look ahead to an exciting and successful future. Our mission now is to release the full potential that exists within the company for the benefit of our clients, to accelerate our transformation and simplify our offering, and to position WPP for stronger growth.”
In July this year, Read was replaced by Cindy Rose, a former Microsoft exec and WPP board member as CEO. Talk about change management. She had this to say upon her appointment:
“There are so many opportunities ahead for WPP. We have and continue to build market-leading AI capabilities, alongside an unrivalled reputation for creative excellence and a preeminent client list. WPP has the most brilliant, talented, creative people and I can’t wait to write the company’s next chapter together.”
Rose’s first significant piece of global business was signing a five-year expansion of its partnership with Google to bring bring more cloud computing and AI technology to WPP and cultivate “the essential skills to transform marketing as we know it”.
To be clear, that announcement wasn’t that WPP would create new tools or technology, only that it would use Google’s. Justin Billingsley, former chief growth officer of Monks and former Publicis chief marketing officer, had this to say on LinkedIn about that announcement:
“After just six weeks as CEO, having sat on WPP’s board for six years watching the ‘WPP Open’ narrative unfold, Rose made her first major strategic call: stop pretending we’re platform builders and start being world-class implementation partners…
“She knows the difference between owning the platform and operating on one”.
WPP Open, he added had “beautifully integrated third-party capabilities lacking the two critical moats required for true platform differentiation in this industry: proprietary technical infrastructure and first-party data at scale”.
At Monks (formerly Media.Monks) Sorrell has led the business to create Monks.Flow, an AI-powered marketing and workflow platform. It also spends much of its time functioning as a consulting group for brands, rather than a traditional agency. Last year, it dropped the “Media” from its name to make that proposition clearer to the market.
Most of the holdcos have something similar, notably WPP’s Open and Publicis Groupe’s Sapient. In its most recent earnings, Publicis CEO Arthur Sadoun told the world that around a third of its revenues come from an AI-enabled production platform growing “double digits”.
The primacy of AI to all forms of marketing communications and the retreat of traditional agency structures are messages that Monks appears to be living. During Cannes Lions, the business’ chief innovation officer Henry Cowling told B&T:
“When I joined Monks eight years ago, I was joining an agency. Today, I think the job of an agency is to help your client replace what you do with AI. That is the role of an agency.
“What everyone frets about is that there will be a moment when that role is finished. I’m more optimistic on that front. Technology is in constant flux, but I think there has never been a worse time in our industry to be an advertiser… I suspect it’s going to be a major them in one way or another in every conversation that you have. I think there’s never been a worse time to be an advertising agency.”
So where does this leave the turkeys? Most agencies are telling anyone that will listen that they are not, in fact, agencies. Ergo, Christmas doesn’t apply to them.
The market might disagree. Over the last 12 months, WPP’s share price is down nearly 55 per cent. Publicis is down 14 per cent (lower still if you look at the year-to-date). Omnicom is down a quarter, IPG is down 16 per cent. Havas is down nearly 18 per cent. S4 is down 43 per cent. Of course, share prices are not the ultimate indicator of an effective long-term strategy. They can also be a reflection of a broader declining sector, not necessarily that the businesses in question did anything fundamentally wrong.
Where the world’s holdcos will go with AI is becoming obvious to most external observers—reduced workforces, faster execution of middling creative work and automation of a significant number of tasks. The most notable of change in Sorrell’s view, is in media planning and buying.
“There will be fewer copywriters and fewer visualisers,” said Sorrell on stage at SXSW. “Employment will be reduced. But the output will be better and the humans can add the human dimension. But the second area is personalisation at scale. The scale is so huge there will be more, in my view, employment opportunities,” he said.
“Third area is media planning and buying. We’re a trillion dollar industry which is much smaller than the investment industry. Blackrock manages 13 trillion and that’s just one company. But we do things semi-manually or semi-automatically. The investment industry does it totally by algorithms… It’s quite clear that media planning and buying will become in very short order a totally mathematical, algorithmic activity… There are 200-250,000 people involved in media planning or buying today. There won’t be in two or three years time.”
The production costs associated with live televised events will also reduce dramatically through AI implementation.
AI will also flatten structural hierarchies within organisations by democratising and spreading knowledge, another shift Sorrell believes is under-appreciated by the market and in the industry. No longer, perhaps, will Don Draper solely pinpoint the tension inherent in the client’s business. The tea lady could do it, if she has her permissions for the AI set just so. Certainly Harry Crane won’t be needed to book the spots either side of the evening news.
So how does this all shake out? It seems as though the traditional holdco model will soon cease to exist. In-housing seems to be the flavour of the month: “nothing wrong with it in my view,” said Sorrell.
“The reality is that in a world that demands agility… clients have to take back more control. After the great financial crisis, they surrendered too much control to outside parties.”
What happens to agency staff remains the great unanswered question—at least publicly. Perhaps it becomes apparent to the holdco bosses that it is too difficult to execute the wide-ranging change Sorrell is envisioning. Perhaps staff filter over to in-house roles over time, making the pain less acute.
What seems certain, however, is that very few turkeys will get to properly exercise their democratic right on Christmas. The world will shift whether they like it or not.
