EUR 850.00 For Business Accounts Only

Morningstar | WPP Controls the Scale and the Prestigious Agencies Necessary to Maintain Its Leading Position

WPP is the largest player within the advertising space, operating in more than 110 countries worldwide. We expect the firm to maintain its market-leading position as it generates competitive organic growth, continues to make acquisitions, and increases focus on the faster-growing emerging and the overall digital ad markets. We look for WPP’s acquisition growth strategy to continue, as the firm has consistently brought in smaller local ad agencies and quickly gained traction in other faster-growing international markets. Historically, WPP has also aggressively acquired larger players in the space such as Ogilvy, Young & Rubicam, and Taylor Nelson. Consolidation within the advertising space has resulted in the Big Five companies (WPP, Omnicom, Interpublic Group, Publicis Groupe, and Dentsu) generating nearly 30% of the world’s total ad revenue. More recently, this consolidation has been driven by globalization of businesses in various verticals, increasing demand not only for vertical-specific advertising expertise, but also for experience, knowledge, and clearer understanding of different cultures and regulations. We also expect WPP to continue acquiring and investing in the growing digital advertising space, which will help the firm remain competitive. Clients of WPP and its peers are allocating more ad dollars toward below-the-line, or more targeted, digital campaigns, creating growth opportunities for WPP and other players in the space. Some of WPP’s acquisitions within the digital ad market include Taylor Nelson, 24/7 Real Media, and AKQA, along with investments in Essence and AppNexus. Among its peers, we believe WPP is at the forefront when it comes to providing different components of digital advertising such as programmatic media buying and ad placement, along with performance measurement. As most of WPP’s larger clients favor omnichannel or multichannel marketing and advertising campaigns, these and further acquisitions and investments help make WPP a one-stop shop.