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Executive Summary:
This overview examines the current structure and state of the advertising and marketing communications industry, and forecasts likely changes. The report also questions the assumption that this is a mature and stable industry as it was previously perceived to be. The overview goes on to show that the advertising industry is undergoing radical change that will influence its dynamics and its structure in the future.
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1. Overview
The business objective of advertising and marketing communications agencies is to target a specific audience on behalf of its clients with a message that encourages them to try a new product or service or to see an existing product or service in a different way and ultimately purchase it. This is done largely through the concept of a brand. Brands allow consumers to differentiate between products and services and it is the job of the advertising agency to position the brand so that it is associated with functions and characteristics that the consumer values. These brands may be consumer brands, e.g. Coca Cola, Nike and Mercedes Benz, or business-to-business (b2b) brands, e.g. IBM, Harvard Business School and KPMG. Some brands target both consumers and businesses (b2c), e.g. Microsoft, Kodak and Apple. Although we tend to associate the advertising industry with consumer goods, governments have large marketing and communication budgets that they use to influence individual behaviour, such as dont drink and drive and to advertise public sector services such as health care and education. Equally, charities and not-forprofit organisations use the advertising industry to attract funds into their organisation or to raise awareness of issues that impact on the quality of life of certain sectors of society. Political groups, religious groups and other interest groups also use advertising to deliver their message and to seek to change peoples behaviour. Traditional view of advertising agencies Advertising is usually placed in the media channels (TV, press, radio, internet, etc.) by an advertising agency acting on behalf of the client company or organisation, therefore they are acting as agents. TSE 9.0 Advertising Industry Overview & Press Cuttings
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Advertising and marketing communications agencies use their knowledge, skills, creativity and experience on behalf of their clients to drive consumption of their brands, as outlined above.
The role of an advertising agency is to work with clients to: Develop their brand / marketing communication strategy Use their creative skills to encompass this in effective advertising and communication Recommend media that effectively targets chosen consumer segments
Emergence of new media forces re-think In the early part of the 21st century Interactive Agencies & Digital Media rose to prominence before the traditional advertising agencies fully embraced the internet. Interactive agencies & digital media may differentiate themselves by offering a mix of web design/development, search engine marketing, internet advertising/marketing, or e-business/e-commerce consulting. Today, the most successful interactive agencies are defined as companies that provide specialised advertising and marketing services for the digital space. The digital space is defined as any multi-media enabled electronic channel that an advertiser's message can be seen or heard from. The 'digital space' translates to the internet, kiosks, CD-ROMs, DVDs, and lifestyle devices (iPod, iPad, PSP, and mobile phones). Often, interactive agencies provide: digital lead generation, digital brand development, interactive marketing and communications strategy, rich media campaigns, interactive video brand experiences, Web 2.0 website design and development, e-learning tools, email marketing, SEO/SEM services, content management services, web application development, and overall data mining & ROI assessment. Tradigital agencies (a new term that is being used) are advertising agencies who are experts in both traditional and digital advertising. They claim to offer the best of both worlds and can be useful in todays digital age where campaigns require both online and above-the-line advertising. Search engine marketing (SEM) and search engine optimization (SEO) firms have been classified by some as 'agencies' because they create media and implement media purchases of text based (or image based, in some instances of search marketing) ads. The rise in interactive agencies can also be attributed to the rising popularity of webbased social networking and community sites such as MySpace, Facebook and YouTube. Some Interactive Agencies have started offering personal and corporate community site development as one of their service offerings.
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2. Current Trends
Money spent on advertising has increased dramatically in recent years. Currently spending on advertising has been estimated at over $150 billion (100 bn) in the United States and $450 billion worldwide (300 bn). While there might be decline in recessionary years, it is predicted that spending on advertising will exceed $510 billion (340 bn) within three years. Below is a breakdown of advertising revenues by media type in the current year.
Global Advertising Revenues
7% 10%
6%
2%
16%
22%
37%
On-line advertising is booming as search engines generate revenues from paid search. Advertisers have discovered that targeted ads online are highly productive. Advertising on mobile (cell) phones is in its infancy but is forecast to grow almost double revenues in 4 years time. Internet-enabled TVs are predicted to transform the relationship between the viewer and the TV set and this will no doubt bring about fundamental changes too. TV advertising still has the largest share of advertising and is especially strong in emerging markets. Radio and newspaper rose 9% and 8% respectively over the last quarter but declined 7% in the US. Direct mail accounts for a further $19 billion in the US alone and PR, branding and other marketing services add billions to the revenues of vertically integrated agencies. In addition there is significant activity in specialist marketing from t-shirts to sponsorship. The advertising industry has gone through a period of rapid change due to consolidation, globalisation and breakthrough technology. Meanwhile, advertisers with global markets for their products and services want to create global brands supported by cost-effective global campaigns. This requires the services of multinational agencies and consultants. The industry is shifting its focus as emerging markets drive revenues from markets that would not have been significant 5-10 years ago. Future trends indicate the strong emergence of consumer brands in areas of the world where sophisticated consumers with brand awareness are in the minority now. Latin America grew 42% in the last quarter of last year, China 35% and India 19%. The US is still the largest ad market growing 4% over the same period. France, showed strong growth at 9% against a trend for the rest of Europe of 6%. TSE 9.0 Advertising Industry Overview & Press Cuttings
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7% 22%
5% 35% North America Western Europe Central and Eastern Europe Asia Pacific Latin America Africa and Middle East
8%
23%
In terms of industry sectors, seven of the top 20 global advertisers were car manufacturers in the last year. However, the two major FMCG (Fast Moving Consumer Goods) producers hold the two top spots for global spend on advertising. Healthcare and beauty, telecommunications companies, food and beverage manufacturers, retailers and the entertainment industry are all featured in the top 20 global advertisers. The top 100 advertisers account for nearly 50% of the measured advertising economy.
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Multi-agency conglomerates Omnicom Group http://www.omnicomgroup.com The Omnicom Group (NYSE: OMC) is one of the world's largest advertising agency holding companies in terms of revenue. Its major holdings include the advertising agency networks BBDO, TBWA Worldwide, and DDB Worldwide. Its portfolio of companies also includes public relations, lobbying, marketing services, interactive design, CRM specialists and media buying services. Omnicom's specialty marketing and public relations agency holdings are managed by its Diversified Agency Services division. Among Omnicom's PR agency holdings are Brodeur Worldwide, FleishmanHillard, Ketchum Inc., Luntz-Maslansky Strategic Research and Porter Novelli. In 2005, Omnicom acquired its first search engine marketing firm, Chicago-based Resolution Media, and its first brand licensing consultancy, The Beanstalk Group. WPP Group http://www.wpp.com/WPP/About/WPPAtAGlance WPP Group plc (LSE: WPP) (NASDAQ: WPPGY), based in London, United Kingdom, is the world's largest communications services group. Its self conceived characterisation is a "parent company," able to bring together the right combination of capabilities to serve a client's analytic and creative brand marketing needs. It is listed on the London Stock Exchange and is a constituent of the FTSE 100 Index. Wire and Plastic Products plc was founded in 1971 making wire shopping baskets. In 1985 Martin Sorrell, searching for a listed company through which to build a worldwide marketing services company, bought a controlling stake of just under 30% at a cost of $676,000. The holding company was renamed WPP Group and in 1987 Sorrell became its chief executive. Sorrell had been the financial director for the advertising agency Saatchi and Saatchi from 1977 to 1985, managing its takeovers of companies in the US and the UK. In 1987 the Company acquired J. Walter Thompson (including JWT, Hill & Knowlton and MRB Group) for $566m. The Company was first listed on the NASDAQ in 1988. In 1989 it acquired Ogilvy Group for $864m and in 1998 formed an alliance with AsatsuDK Inc. of Japan. Publicis http://www.publicisgroupe.com Publicis Groupe (Euronext: PUB, NYSE: PUB) is a French multinational advertising and communications company. It is one of the big four global advertising holding companies. It provides traditional advertising, media services, and specialised agencies and marketing services SAMS) to national and multinational clients. Its traditional advertising services principally involve the creation of advertising for products, services, and brands. It also includes strategic planning involving analysis of a product, service, or brand compared to its competitors through market research, TSE 9.0 Advertising Industry Overview & Press Cuttings
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sociological and psychological studies, and creative insight. The company was founded by Marcel Bleustein-Blanchet in 1926 and is headquartered in Paris, France. Interpublic Group of Companies http://www.interpublic.com The Interpublic Group of Companies, Inc. (IPG) (NYSE: IPG) is one of the big four global advertising holding companies (the others being Omnicom, WPP and Publicis). It is headquartered in New York City and is the parent company of Universal McCann media agency and McCann-Erickson, one of the largest agency networks in the world. IPG was created in 1960 as the first marketing services management holding company, with McCann-Erickson and McCann-Marschalk as its two subsidiaries. Since then, it has grown tremendously, with over 185 companies purchased in a two-year span from 1999 to 2001. Comparisons have been made to AOL Time Warner, as both are media conglomerates that have trouble managing their holdings. The advertising firm Campbell-Ewald is also a subsidiary of IPG Havas http://www.havas.com/havas-dyn/en/ Havas is a multicultural and decentralized Group, Havas is present in more than 100 countries through its agencies and contractual affiliations. In January 2009, the Group reorganized into two Business Units: HAVAS Worldwide and HAVAS Media. Havas has remained at the forefront of this change by gearing its organization to the new needs emerging in communications. In order to rise to these new challenges, and rather than opting to confine this new digital activity to a silo, the Group has decided to put digital at the core of all its businesses. This culture, combined with different multidisciplinary integration programs Cration Media being one of these enables Havas to offer its clients some of the most innovative and integrated solutions on the market. Havas ranks seventh worldwide among the major communications groups. Havas markets are distributed as follows:
North America France Continental Europe excluding France UK Latin America Asia-Pacific TOTAL 32% 23% 23% 11% 6% 5% 100%
Revenue per client remains well distributed; the Groups leading client represents 3% of total revenue and the ten leading clients account for 20%. The above should give you a flavour of some of the big players in this industry. In addition to these large, global agencies, the industry is made up of numerous smaller boutique agencies. Smaller boutique agencies survive and prosper by delivering value-added services through in-depth knowledge of certain sectors or markets, highly specialised services such as digital or by building a reputation for innovative and ground-breaking creative advertising/marketing campaigns. Many small agencies spin out of defectors from the large agencies while, in turn, smaller agencies are often acquired by the large multi-nationals in order to acquire specific capabilities to target new sectors or TSE 9.0 Advertising Industry Overview & Press Cuttings
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markets or provide additional services to existing clients. These are known as integrated agencies. The beginning of the 21st century has seen new competition in this industry as giants such as Google and Microsoft begin to exploit their ability to interact with millions of potential consumers of branded products. Will one of these be the largest advertising agency of the future?
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Smaller boutique agencies will normally have creative and creative production teams, account management teams and some form of traffic department to manage the workflow of the agency. Many will have a specialist function which distinguishes them from other agencies and makes them attractive to a client. They might specialise in PR, or in a specific form of PR such as political lobbying, or they might specialise in Research and Insight using propriety research methods that distinguish them from all other agencies. Digital agencies may build a reputation on specialist knowledge of, for example, Facebook or Google.
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Research & Insight Consultancy Research & Insight consultancy is essentially market research where strategicallyfocussed consultants interpret research data and give insights into future consumer and market developments and help with marketing and brand strategy. The term insight is fashionable in that it indicates the way in which research companies have tried to add value to their business proposition by understanding the underlying values, beliefs and motivations that drive consumer behaviour and consequent current and future spend on consumer brands. Public Relations (PR) Public Relations (PR) is the practice of managing the flow of information between an organisation and its public audience. Public Relations - often referred to as PR - gains an organisation (or an individual) exposure to their audience using topics of public interest and news items that do not require direct payment in order to get media space. Because PR places exposure in credible third-party outlets, it offers a third-party legitimacy that advertising does not have. Common PR activities include speaking at conferences, working with the press, and employee communication. PR can be used to build rapport with employees, customers, investors, voters, or the general public. Lobbying is a branch of public relations, which specialises in the practice of influencing decisions made by governments. It includes all attempts to influence legislators and officials, whether by other legislators, constituents or organised groups. Governments often regulate organised group lobbying. Branding & Identity Branding & Identity is a type of marketing which specialises in creating and launching brands as well as rebranding. Branding agencies create, plan and manage branding strategies. Branding agencies may be hired to produce a brand strategy or, more commonly, a brand identity, which can then be outputted via a branding campaign, which is a type of marketing campaign.
Direct Marketing Direct Marketing is a sub-discipline and type of marketing. There are two main definitive characteristics which distinguish it from other types of marketing. The first is that it attempts to send its messages directly to consumers, without the use of intervening media. This involves commercial communication (direct mail, e-mail, telemarketing) with consumers or businesses, usually unsolicited. The second characteristic is that it is focused on driving purchases that can be attributed to a specific "call-to-action. If the advertisement asks the prospect to take a specific action, for instance call a free phone number or visit a website, then the effort is considered to be direct response advertising. Mail Handling Services is a down stream support function within Direct Marketing consisting of letter printing and personalising from large databases, envelope TSE 9.0 Advertising Industry Overview & Press Cuttings
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manufacture and printing, insertion, collation and bulk despatch locally or internationally. Relationship Marketing / CRM Relationship marketing / CRM is a form of marketing developed from direct response marketing campaigns conducted in the 1970's and 1980's which emphasised customer retention and satisfaction. Relationship marketing differs from other forms of marketing in that it recognises the long term value to the firm of keeping customers, as opposed to direct or "Intrusion" marketing, which focuses upon acquisition of new clients. The Relationship Marketing or CRM agency works with clients to help them retain existing customers rather than find new ones. CRM software is used to support these processes, storing information on current and prospective customers. Specialist Communications Specialist Communications - A range of specialist services, which might include custom media and multicultural marketing to event, sports, youth and entertainment marketing; corporate and business-to-business; media, technology and production services.
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6. Future trends
Our research has identified a number of future trends that we believe will impact on the industry. These are listed below in no particular order as a basis for discussion in terms of how they may impact on WRSX in the future: Industry structure While overall growth in the advertising industry is predicted, much of the industry in the US, Europe and other developed markets appears to be in a mature phase with traditional media such as newspaper advertising revenue falling in the US. However, in developing geographic markets and in digital marketing the industry is undergoing a period of rapid change. In the past, larger agencies have been able to build highly profitable businesses by providing services throughout the clients value chain through their subsidiary businesses but there is some evidence of emerging client resistance to this.
Basis of competition Competition within the industry is fierce based on creative ability, range and breadth of services and market insight. Client relationships and sector knowledge are highly valued. Large multi-nationals compete on the basis of the quality of their creative teams, breadth and range of services, economies of scale (in areas such as media buying and direct marketing), understanding of markets and, increasingly importantly, global reach. Smaller agencies compete on the basis of their specialist knowledge and established relationships with clients. This has been the basis of competition to date and largely remains so. However, the emergence of new players in the market may change the way agencies compete in the future in all or parts of their markets. Microsoft paid $6bn (3bn) to buy digital marketing firm Aquantive in its biggest ever acquisition in 2007. Aquantive advises agencies and website publishers on putting adverts online, connecting buyers and sellers. At the time of acquisition, the $66.50 per share offer was 85% higher than Aquantive's closing share price of $35.87. A month prior to Microsofts acquisition of Aquantive, search engine giant Google agreed to buy DoubleClick for $3.1bn, while Yahoo snatched the 80% of Right Media Exchange it did not already own for $680m. Will these businesses, which have the potential to become broad-based advertising agencies in their own right, actually do so? Do they have, or can they acquire the capabilities they will need to compete with the large integrated agencies and does such a move fit with their strategy and shareholder expectations?
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Creativity as king Traditionally this industry has embodied the idea of creativity as the vital differentiator between the best and the mediocre. Individuals have often been at the heart of this creativity. If delivery technologies are changing will creativity become more or less important in the future? Audiences screening out adverts The ability to record shows on digital video recorders (such as TiVo) allow users to record the programs for later viewing, enabling them to fast forward through commercials. Additionally, as more seasons of prerecorded box sets are offered for sale of television programs; fewer people watch the shows on TV. However, the fact that these sets are sold, means the company will receive additional profits from the sales of these sets. To counter this effect, many advertisers have opted for product placement on TV shows. Adverts as entertainment in their own right Particularly since the rise of "entertaining" advertising, some people may like an advertisement enough to wish to watch it later or show a friend. In general, the advertising community has not yet made this easy, although some have used the Internet to widely distribute their ads to anyone willing to see or hear them. Consumer segmentation/ability to target specific audiences Another significant trend regarding future of advertising is the growing importance of the niche market using niche or targeted ads. Also brought about by the internet and the theory of The Long Tail, advertisers will have an increasing ability to reach specific audiences. In the past, the most efficient way to deliver a message was to blanket the largest mass market audience possible. However, usage tracking, customer profiles and the growing popularity of niche content brought about by everything from blogs to social networking sites, provide advertisers with audiences that are smaller but much better defined, leading to ads that are more relevant to viewers and more effective for companies' marketing products. Among others, Comcast Spotlight is one such advertiser employing this method in their video on demand menus. These advertisements are targeted to a specific group and can be viewed by anyone wishing to find out more about a particular business or practice at any time, right from their home. This causes the viewer to become proactive and actually choose what advertisements they want to view. Adverts influencers of behaviour As the CSR (Corporate Social Responsibility) agenda becomes more important to businesses in terms of attracting employees and shareholder investment, advertising is being seen as a way that businesses can promote their role in influencing people to live better lives in a better society. Whereas previously it was mainly governments who tried to use advertising to promote behaviour change such as anti-smoking campaigns, businesses are with agencies to promote themselves and their brands as representing a force for good in influencing behaviour such as responsible drinking, support of social enterprise and promotion of fair trade principles.
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Compensation based on results achieved Billable hours spent on creating advertising and commission on media and services bought on behalf of its clients by advertising agencies have been the standard way of compensation since the 1970s. However, in recent years, larger advertisers such as Coca Cola and Procter & Gamble have been moving away from this compensation model to a value model based on a number of metrics, including sales and market share. Most agencies work on a combination of fee-based and commission based compensation. The fee is paid by the client for whom the marketing is being done. The commission is a payment from the media to the agency and is usually equal to 15% of the cost of the advertisement. The broadcast media, radio and television, traditionally pay a commission to advertising agencies, usually taken as a discount. Some industry leaders, say the advertising industry has been approaching and avoiding a change in how it is paid for many years. Avoidance, however, may no longer be an option. In early 2009, Coca-Cola said it would adopt a value-based compensation system for the advertisers that do work for its 400 brands. Rather than paying advertising agencies for hours worked, Coke will pay for results achieved. Its new model guarantees to cover advertising agencies costs, plus a bonus of up to 30%. The bonus depends on a number of metrics, including the agencys overall performance, and the sales and market share of the products being advertised. Coke insists that its aim is not to cut costs but to inspire creativity and efficiency. Procter & Gamble, a consumer-goods giant which has also ditched hourly fees in favour of performancerelated fees for 12 of its brands, says the same thing.
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MarketingWeek MotorCochoosesGJKAdvertising
NewYork GJKwerecelebratinglastnightafterhearingthattheyhadwonthepitchfortheMotorCo businessforthenextthreeyears.MotorCohasoneofthetop20marketingbudgetsinthe worldandthiswillbeamajorblowtotheirpreviousagencyWRSX. WhenaskedwhyMotorCohadchosenGJKinsteadofitsexistingagency,DanReynolds, MarketingDirectorofMotorCosaidthathefeltthatWRSXwasnotintunewiththeglobal ambitionsofMotorCoandhadfailedtodeliveracreativepropositionthatfiredthe imaginationoftheMotorCoteam.AskedifpricehadplayedapartinthedecisionReynolds commentedthatLikeeveryonethesedayswearelookingforvaluebutpriceisonlyoneofthe criteriaweusedtoselectouragency.WefeltthattheGJKteamwereclearaboutourbrand strategyandhowtodeliverit.
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MarketingWeek GGTAdGroupacquiressecondagencybrandinglobalstrategicmove
London Inasurprisemoveyesterday,theLondonStockExchangequotedGGTAdGroupannouncedthe acquisitionofBabbettHargreavesChanWorldwideaprivatelyownedsimilarsizedcompetitor intheadvertisingindustrysector.Inannouncingtheacquisition,CEOPeterHansHendrickssaid thatthiswasanimportantpartofitsstrategyforgrowth. Foundedin1986,GGTAdGroupisastrategicholdingcompanythatmanagesadvertisingagency brandGGTWorldwideandnowBHCWorldwide. Ourstrategyhasalwaysbeentofocusoncreatingaportfolioofmarketleadingglobal advertisingagencybrandsandsticktothedisciplineofadvertisingonly. Byacquiringasecondglobalbrandintheadvertisingagencyindustry,wearegivingourselves thecriticalmasstogiveourclientsexcellentcreativeadvertisingcampaignsanddelivergrowth forourshareholders. TomasBerendz,advertisingindustryanalystatZTCSecuritiescommented:Byconcentrating solelyoninvestinginadvertisingagencies,GGTAdGroupcouldbeseriouslyoverlookingthe opportunityofbecominganintegratedagencythathasinterestsindiversifiedcommunications serviceslike:marketingconsultancy,specialtycommunications,researchconsultancyand interactive/digitalmediawhicharepotentiallyhighermargin.However,aclearfocuson advertisingonlymaypayoff. TheGGTAdGroupsharepricecloseddown15ptoGBP3.05
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WallStreetBusinessReview Directmarketingagencyshiftsoperationstolowcostcountry
Overrecentyearswehavebecomeusedtocompaniesshiftinglargepartsoftheiroperationsout ofmarketswhereemploymentcostsarehigh.Manufacturing,banking,ITandmanyother industrieshavefoundthattheyareabletocuttheircostsbyeithermovingtocheaper employmentmarketsthemselvesoroutsourcingactivitiestosuppliersintheselowcost countries. JoAllenDirectMarketingisthelatesttofollowthistrendasitshiftsmostofitsdirectmarketing activitiesfromtheUStoBrazil.WehaveretainedasmallteaminSeattleincludingAccount Managersandaselectteamofcreativeexpertsindirectmarketingbutallotheroperationswill berunoutofBrazilfromnowon.Thecostadvantagesaresubstantialandwillallowusto competemuchmoreeffectivelyinthemarket.Thisbusinessisverypricesensitiveandweneed todrivedowncostsifwewanttosurvivesaidaspokesmanforJoAllen.
MarketingToday MarketinsightsbusinessLaPharepullsoutofRussia
LaPhare,theParisbasedMarketInsightsbusinessannouncedthisweekthatitispullingoutof RussiaonlytwoyearsaftersettingupofficesinMoscow.JulesMasson,LaPharesCEOsaidthat theteamthere,headedupbySylvainMistralhadfailedtosecureadequatebusinesstojustify thecostsofoperatingdirectlyinRussia.MistralandhismainlyFrenchmanagementteamhad workedhardtobuildclientrelationshipsbutthemarketisadifficultoneandwewereunableto buildasignificantpresenceinthistimescale.Westillbelievethatitwastherightstrategicmove butmaybeitwastoosoonormaybeitjustneededmoretime.LaPhareclientsinRussiawill nowbeserviced,astheywerepreviously,fromtheParisoffice. AsbusinessesscrambletotakemarketshareintheBRICScountries(Brazil,Russia,India,China andSouthAfrica)theLaPhareexperiencemaybeasalutarylessoninplanningeffective strategiesforenteringthesemarkets.
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Juliette Waldron sets out her strategy for driving profits at WRSX
In an interview this week, Juliette Waldron set out her strategy for turning around the fortunes of the WRSX Group: We are a mid-sized advertising agency group with a good creative reputation offering a range of advertising and marketing communications services. How do we take a midsized player, turn it into a top 10 agency group with global ambitions and increase return on investment for our shareholders? Many of our competitors are relying on acquiring advertising businesses alone, while at WRSX, our strategy has been to increase our stakes not only in advertising businesses, but also in research, PR, direct marketing, branding, film production and even sports marketing. We are no longer appropriately described as an advertising agency. We can be more accurately described as a diverse but related marketing communications group where we can offer our clients an integrated package of services within the same group of companies with service quality and creative quality being assured by our improving reputation. Waldron wants to disprove investment analysts talk in the business press that the WRSX strategy is unclear and that some past acquisitions reflect questionable strategic choices as they do not (i) support a clear and focussed WRSX business proposition and (ii) are not delivering sufficient profit to the bottom line. I am confident that continuing with our growth strategy and increased focus on business strategy in bringing our costs in line with industry averages will set us on the path to increased growth in market share, profitability and returns for our shareholders. Asked about some current issues within the WRSX Group, Waldron was quick to discount these as short-term problems of the kind that all businesses go through from time to time. Clearly the option to build profits through improvements in the current businesses, or indeed reduction of the size of the current business to focus on specific service areas, or a reduced geographic profile is not part of the Waldron strategy for delivering shareholder value. Naturally we have looked at these options but we believe that shareholders will best be served by our stated strategy of global expansion and delivery of a range of marketing services to clients in our chosen industry sectors of automotive and transport, health and pharmaceuticals, telecoms, personal care, beauty and fragrance, NGOs and charities and government information and behaviour-change campaigns . Many analysts question the ability of WRSX to make that leap into the top 10. Does it have the resources for its ambitious programme of expansion? Waldron clearly believes that it does. Would shareholders be better served by a programme of cost-cutting? Waldron does not rule out cost-cutting but believes that this is about redeployment of resources into businesses that will drive growth in the medium to long-term time horizons as well as defending the current businesses from aggressive competitor pricing strategies. WRSX has an outstanding reputation for creativity but does it have the management team to deliver on its strategy? Again, Waldron is confident. Shareholders will want to see early signs that Waldron has a grip on WRSX and that her strategy is producing results. Otherwise they will begin to question whether her strategy has been derived from accurate reading of the market opportunity for WRSX or more from personal ambition and misplaced confidence. (Extract from an article in Bloomberg Business Week)
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