Tuesday, February 1, 2011

Martin Sorrell's View of the Key Developments Facing Advertisers and Media Firms

Martin Sorrell, who grew up and lives in the UK, is head of WPP, the largest marketing-communication conglomerate. As such it decides which media firms to support around the world. List list is from "Jack Myers’ Think Tank," a newsletter. Meyers evidently got it from a speech Sorrell recently gave.

1. Global Shifts in economic, political, social and cultural power.
2. Continuing Auto Production Capacity and the under-capacity of people/customers. While U.S. auto capacity has declined, the capacity in China and India has expanded. Over capacity of supply and under capacity in the supply of people makes the role of agencies and marketing even more important.
3. The Web. The reason the Consumer Electronics Show is important is that the tech companies are now media owners. The Web disintermediates legacy players and is a more attractive destination for talent.
4. Internal Communications. Communicating strategic and structural change is an internal challenge for organizations as much as -- or more than -- an external challenge.
5. Retail Power. Major retailers are gaining power, especially when there is little inflation. Retail companies put pressure on manufacturers, pushing companies like P&G into direct consumer marketing through websites.
6. Global Centralization. As companies expand and gain global influence, they are integrating their organizations at the center.
7. Procurement and rise of the finance function puts more emphasis on cost management.
8. Governments, as both regulators and as clients.
9. Corporate social responsibility. Doing good is good business.
10. Content. We have to think about content in the context of how business is fundamentally changing. Consumers have to pay for content. There is not enough advertising to finance the business models of all the new media. There needs to be more consolidation for the health and development of the media business. State subsidies have to play a greater role to maintain professional journalism.

- From Jack Meyers, "Sir Martin Sorrell's Ten Priorities for Media, Agencies and Advertisers," From Jack Meyers Think Tank, February 1, 2010.

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