WPP’s Cindy Rose prepares radical reset in turnaround ‘mission’
Advertising group’s new CEO plans restructuring and says traditional agency model is from a ‘bygone era’
WPP’s new chief executive Cindy Rose is working on a restructuring of the struggling British advertising group, as she vowed that it was her “mission” to secure its long-term future in an industry being rapidly reshaped by artificial intelligence.
In her first interview since taking over in September, Rose said she wants to dramatically simplify the London-listed group’s operations to reflect that the traditional advertising agency network model was from “a bygone era”.
The plans, which Rose said will help transform WPP from “being a holding company to an operating company”, will be unveiled fully next month.
Rose, 60, took charge of a company reeling from a succession of client losses and profit warnings, leading to a drop in WPP’s shares of about 60 per cent over the past year. The group is now valued at just £3.7bn, having been worth as much as £24bn less than a decade ago, and dropped out of the FTSE 100 this month for the first time in close to 30 years.
“You have to understand [that] this is more than just a new job for me. This is a mission,” Rose said, adding that she intends to secure the next 40 years of a “great British company that deserves to be successful”.
The new chief executive declined to comment on potential job losses but conceded she is “trying to find operational efficiencies.”
Rose, who previously led Microsoft’s operations in Europe, took WPP’s top job from long-term boss Mark Read after serving on the group’s board as a non executive director since 2019. During an interview at WPP’s new London offices, on the south bank of the river Thames, Rose vowed to “simplify” the group’s operating model.
“We’ve got to be able to provide integrated services to our clients, because that’s what they tell us they want,” she said. “[Clients] want the best of WPP, wherever that talent sits. They don’t want to be constrained by agency constructs. That might mean there’s a social influencer expert there and a commerce expert there and a data expert there.”
More than half of client pitches are for integrated services across WPP’s agencies.
Rose, a dual US/UK national who splits her time between London and New York, has concentrated on WPP’s clients in her first few months. “I see clients every single day. I’m in pitches, I’m doing meet and greets, I’m in quarterly business reviews.”
In October WPP projected that adjusted like-for-like revenues will decline by between 5.5 and 6 per cent for the current year, prompting Rose to say WPP’s performance had not been acceptable. She said this had since been taken as “a call to action” internally.
“Clients are already noticing the difference, and it’s showing up in the business that we’re winning,” she said.
In her first 100 days — “not that I’m counting” — Rose said WPP has won work for Mastercard, Henkel, Reckitt Benckiser, PwC and Goldman Sachs. It won more than $1.5bn in billings in November, and is set to land a major UK government contract in January.
Rose acknowledged that WPP’s major shareholders are “obviously frustrated . . . all I can do is show up and listen and show humility.” Earlier this month WPP raised €1bn in an oversubscribed bond issue, seen by insiders as a vote of confidence from the City.
The decline in WPP’s share price has been partly driven by concerns over the impact of AI tools — which are able to produce ads cheaper, faster and at a huge scale.
Rose countered that WPP would use the technology to its advantage, citing WPP Open, its AI powered marketing platform that turns simple prompts into ads in minutes, as a key source of differentiation.
The platform — which also helps WPP plan, place and measure the effectiveness of ads — allows the group to “break down the silos between creative production and media, all powered by a common data model,” Rose said. She believes there is a “misperception in the market that we’re lagging behind [in the use of AI tools].”
WPP’s boss acknowledged that the adoption of AI tools will lead to questions over the viability of some roles internally but rejected the idea that the technology is “an existential threat” for the industry.
“I think AI is a once in a generation opportunity,” she said. “AI automates the ordinary and massively elevates the extraordinary. And to do extraordinary creative work, you need humans.”
WPP is not the only advertising holding company reorganising itself. Last month, Omnicom killed off several historic agency brands as part of its merger with IPG. Rose said though that she is supportive of WPP having multiple agencies despite her push to simply its structure.
Even so, she said the jobs in WPP were changing. It has more than 12,000 “creatives” but almost as many — nearly 10,000 — software engineers, developers, AI practitioners and data scientists.
The rapid growth in the use of AI to make ads threatens to upend the concept of the “billable hour”, which the industry has long relied upon in charging for its work.
Rose admits AI “will put downward pressure on pricing,” adding that WPP has to convince clients it’s worth them reinvesting the money they save into its other services, which can “set them apart from their competitors.”
“If we do our jobs well — and we will — AI will be value-accretive to WPP,” she said. “It’s not going to flip overnight, but we’ll go from being a ‘time and materials’ based business to more of a tech fees and outcome based one.”
“The good news about all of this [disruption is that] it’s all within our control,” Rose added. “It’s all about execution. We’re fixing it now.”
