The Hindu Business Line : WPP expansion to focus on new tech

Mumbai, July 18 Acquisitions through stake holding or full-fledged ownership in new media companies are on Sir Martin Sorrell’s radar. Having acquired a 10 per cent stake in Mr Kishore Biyani’s Future Media recently, the WPP Chief, who is on a visit to India, is eyeing more companies in the media and digital space.

At a media briefing here, Mr Sorrell said, “We are looking at both picking up stake as well as full-fledged acquisitions. However, in the case of new media we would rather have a stake as we are still experimenting and do not want to commit ourselves.” With a tendency to be a ‘late stage’ investor in the new businesses, Mr Sorrell believes in looking at new acquisitions carefully and in the notion of growing organically. “Organic growth is still going to be the prime driver as top line growth is important for us,” he said.

Optimistic about India and the emerging markets, his global agenda comprises expanding in the growing markets with a focus on new technology. His intention is to fast expand into emerging markets such as China, Brazil, Indonesia, Latin Amercia, Mexico and India to generate equal revenue ratios from the US, Europe and the emerging markets.

On the Indian market, Mr Sorrell said, “Today, we have $250 million in revenues and a people base of over 6,000 with the domestic economy growing at 9 per cent of GDP. Growth in India is in excess of 20 per cent and we believe in expanding in the domestic market.”

Betting on new technology and how it can be adapted to advertising, Mr Sorrell said, “The explosion of new media is taking many forms: Internet, mobile phones, iPods, blogs and personal video recorders. We need to redirect resources towards such growth areas without losing our ability to serve traditional areas.” In fact, WPP’s conference held in Bangalore last week had a strong non-traditional advertising theme with discussions centred on the digital space.

“Currently 25 per cent of our business is in the digital and interactive space. We want to take it up. There will be growth in technology which will impact traditional media,” observed Mr Sorrell.

With India becoming an outsourcing hub for the WPP Group, Mr Sorrell pointed out at the disadvantages of operating from the region. “There is a perception that India will become a manufacturing hub, but at the same time there is also a perception that India is cheap, which is not the case,” he said.

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