from AdAge: The chief executive of WPP Group, Martin Sorrell, told the Credit Suisse Conference today that 2004 “was a relatively good year.” Speaking in the Grand Ballroom of the Plaza Hotel, Mr. Sorrell kicked off the “Media and Telcom Week” gathering with his 8 a.m. presentation.
He also predicted that the advertising industry’s expansion will slow in 2005. Factors contributing to this, he said, include the U.S. fiscal deficit, a weak dollar and inflated prices for commodities. He also noted that retailers continue to use trade promotion to spur growth, a trend he characterized as troubling.
“The inexorable march of Wal-Mart, Tesco and Carrefour put pressure on manufacturers,” he said. “We are concerned by the emphasis on trade promotion. That’s a recipe for disaster in our view,” because consumers become used to waiting for sales. The better approach to growth, he said, is to rely on innovation in product development and branding.
My note: Interestingly, WPP owns several of the premier marketing services shops in the industry, like Wunderman, VML and 141 Worldwide.
