'New markets, new media and consumer insights' the new focus for ad giant

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About Conference Chatter Anecdotes, insight, observation and analysis direct from the conference circuit.

If ad:tech attendees came to hear Sir Martin Sorrell offer assurances of a coming rebound in advertising spend, they likely left unsettled and disappointed.

Instead, the chief executive of the advertising and data giant WPP kicked off the high-tech ad show Nov. 4 by telling a capacity crowd in New York that the advertising world that the West had come to know and love was essentially over.

Indeed, for all the talk of having come off a bottom in spending, Sorrell said he had "never seen clients focused on costs the way they are now," calling the current economic environment "very severe stuff."

Noting the recent round of quarterly earnings reports, Sorrell said advertising-related companies, aside from a select few, were generally not increasing revenues. He also said companies were making their numbers "ugly" by cost cutting.

In an effort to come to grips with a new normal, Sorrell said companies such as WPP were putting huge resources into data and analytics, looking to areas such as China, India and Latin America for growth and focusing on growing new media.

On the latter point, Sorrell noted the familiar disparity between time spent online and percentage of advertising spend — WPP clients spend about 12% of worldwide budgets online — and suggested agency and brand heads have generally not fully embraced new media, as industry leaders tended to be "of an older vintage."

As a generation that grew up tethered to the Web takes more leadership positions, the shift is going to be "quite significant," Sorrell said.

Meanwhile, as he navigates the current environment and looks to the future, the executive said the information and data side of WPP would represent the largest part of the business, saying the company's strategy could be summed up as "new markets, new media and consumer insights."