Will Cindy Rose's plan save WPP?

[Music] Hello and welcome to the campaign podcast. Last week on Thursday 26th of February, WPP announced a new strategy and structure hoping to turn its fate around while reporting its worst performance since the pandemic. CEO Cindy Rose's new structure splits WPP into four core divisions, WPP media, WPP creative, WPP production and WPP enterprise solutions, which will be led across four regions globally. The strategy includes 500 million pounds in cost savings and a three phase plan called Elevate 28. In addition, Rose's plan aims to transition the business from a holding company structure to a single company. So in this episode, the campaign team will break down the announcements and what it means for WPP's agencies. Look at how the company compares to its competitors and discuss if it will work. So joining me to discuss this, please welcome editor-in-chief Gideon Spaniard. Hello, Gideon. Hi Lucy. Editor-in-chief Gideon. Hello Lucy. And deputy media editor Sean Lewis. Hi Lucy. And I am Czech and multimedia editor Lucy Shelley. So we had quite a busy day on Thursday last week. There was a three hour presentation which I think some of us were there for all of it. I was in and out doing other things. Got the Q&A at the end though which was quite exciting. But we'll get to our reactions to that in a bit. But I thought first should we just outline what the headlines of this new Elevate 28 strategy is and what we will be seeing in the next couple of years. Sean, do you want to kick us off? Like you mentioned, Cindy Rose is now describing WPP as a single company. And this single company is being split into four divisions. So we have WPP media, led by Brian Lesser, which is mainly wave maker essence media comm and mind share WPP creative, which was newly announced but had been previously reported on led by John Cook, which is made up of VML and the local VAKQA person, which is P.R. division, land or and design bridge and partners. So a lot under there. And she's quite clear that they're not some setting agency brands, but they're going to give them a single operating system to kind of like operate within. WPP production, which is launching January this year and it used to be Hogarth and that's going to be led by Richard Glasson and then finally a new one, which is WPP enterprise solutions, which is taking services such as customer experience CRM and AI transformation of clients and putting them under one roof and that will be led by Jeff Geheb, who was CEO of enterprise solutions at VML. You weren't the preview before the announcements came out. What's your reaction to the now now that you've seen it all come out? For me and from the people I talked to after the review. I think a lot of it does seem a little bit like window dressing, creating a new narrative, but I'm more than willing to accept that I'm wrong on that. There's someone from a different network I spoke to you said there's not much substance to the review, but it was a mix back they didn't see much substance in the review and I think I also struggled to see how different it was truly going to be structurally. It just seemed like it was adding new names to things that are already there. But I do think that the narrative is starting to change. And I think that that window dressing to me is actually quite effective. They're now being seen as like competitive again, like they've started to win the kind of language of simplicity is really helpful. So yeah, that's my reaction. It's helpful to their image. Yeah, I mean, I think, you know, obviously there was so many announcements about the new strategy, the new plan, but we can't forget those financial results were, as I said, the worst that they've been since the pandemic. I get in you want to see him in covering all the holding companies financial results for a long time. What was your reaction to the whole event last week? I would say, first of all, that WPP is in a very bad place, not that we take any pleasure in saying that is in a terrible place really. It's had a decline in revenues of 5.4% in 2025 that followed a previous year of decline and a previous year before that where the growth was anemic in the three years before the pandemic is revenues declined. If you look at this over seven, eight, nine years, WPP, you know, it's not been all bad, but they have really struggled. There's been so many restructures and people who know the industry know that there was the VML, Y and R merger, the one, the M Thompson merger, the whole WPP media group M shakeup last year. So I think the first thing to say is it's very difficult for anyone who knows WPP to think that there's suddenly some new answer that's going to solve their problems. I also went all the numbers point the wrong way, which they do at the moment or virtually all the numbers. That's another thing. I think people are trying to give Cindy Rose the CEO a fair wind if you like, a new leader should be given the chance to set out their stall. It's clear that they need to reinvigorate the business and they have actually had some after a very poor run for new business and losing Mars and Coca-Cola in North America and things like that. They did have a bit of a pick up. So I think what's it was interesting and I think most of the editorial team or a good number of them watch the webcast this presentation which went on for two and a half hours. She was trying to talk about other metrics like new business wins. The revenue that they win will take time to fall into the business. In the UK government, which they did in December, that won't probably come on stream. I don't know the exact time till the middle of this year. Jaguar Land Rover, that's actually not even been formally signed yet. That will be I think June or some sort of time like that. So she was trying to get people to bind this idea that a single company rather than a holding company with these four pillars, these four units will be more joined up. And I think importantly their technology and AI layer WPP open helping to bring it all into a single company where they've got one set of systems and also interestingly she says aligning all the bonus incentives much more to the holding company. Sorry, old language new operating company. So I know it's a bit of a long answer, but I did not come to watch thinking that it was going to be revelatory and I think some of the responses from the financial analysts who I think were the key audience in the room were sort of similar. They didn't come expecting to be wowed. She's got a hell of a lot to do to get the business turning around. I mean they were the only external audience in the room weren't they getting. Pretty much. Yeah, so this event happens at WPP's offices in London and it was their annual results. So typically they do it for the audience of analysts who are looking at the financial numbers. They actually did it in their one South of the bridge office which people might know is the home of WPP media not in C containers. So I don't know if that was a little message. So he contains is the corporate HQ but they wanted a new site to do it and journalists have gone along to the previous in person investor days campaign was at the last two. But no journalists were there was no not enough room for any journalists this time. Alas so can't tell you exactly what the mood was like in the room, but we got to watch it all of us and his quotes from a couple of the analysts, Bank of America. No radical transformation, Barclays, everything they said is sensible and unsurprising. It will all be about execution. I'm not so sure for those of us who have followed the agency world that it was unsurprising. I think there's quite a few things we can discuss but I'm just giving you that as a flavor of the fact that I couldn't tell I'd guess there were 80 people in the room. It was and we were just watching on the webcast. I was going to ask this whole strategy was also focused around leading with media and when they did the Q&A at the end the only people on stage were Cindy Rose, Brian Leicester, the CEO of WPB Media and the CFO Joanne Wilson. It gives the same signals like you are saying about it being in one separate bridge or rather than see containers perhaps that we did here from Don Cook, the CEO of VML and Johnny Hornby as well. Now they're starting to make these changes. How different will WPB be? Are these massive changes as we've been reporting on before or is it window dressing as Sean was saying? Maze, what do you think? It was interesting. I guess at first I'm quite intrigued and I don't think we fully know the sort of reasons behind it are how it's going to work. But the different way they've approached WPB creative versus WPB Media. Obviously as we're led to before some quite serious restructures of WPB Media last year unfortunately lots of people lost their job and there's basically now at WPB Media. The group is the employer of everybody and they moved a lot of the media work, the buying into a separate unit which is run by Kelly Parker. And so the agency brands in WPB Media as I sort of understand it exist around certain clients but aren't necessarily an entity as of themselves. Whereas I think you alluded to it Lucy in WPB Creative. They've gone from a less consolidated version for that side. I bore people often because I quite like symmetry and consistency. I'm like why wouldn't you just do it like you did it there? There must be a reason why they haven't done it. We've maybe not had time. It's obviously only been a few days to sort of probably interrogate that and finally answer to it. But it seems to me interesting that for a business who has obviously been on the record saying they're looking for potentially companies to sell is the therefore an advantage to potentially keeping those WPB Creative brands distinct and separate in that way. Should I guess an attractive buyer come looking for them? I mean that's pure speculation. Maybe I'm not going to do that. It just seems to me like given that we've had these multiple phases of restructure on the media side. And actually multiple phases of research on the creative networks. I hope there's a really good strategic reason for them doing it the way they don't. We don't we're not here any years time and they're doing the next phase of the same thing that they could have done to begin with as opposed to where I'm coming from. I don't properly understand the ambition for WPB Open. And I saw a post on LinkedIn from Justin Ricketts who's the Global Chief Transformation Officer at WPB Production. I don't know him. Just popped up with my feed. I thought it'd be worth just reading his description because it and you could argue it's potentially interesting that I'm understanding it more from this random LinkedIn post. Perhaps but he says previous WPB reorganizations changed the org chart. This one changes the operating model. The platform enables what the structure promises. So he says WPB Open is a proper operating system that runs across all the four units. And so it's going to allow briefs and works to pass from one unit to the other using the same infrastructure. One of the big things that WPB are pushing is the fact that this has been built in a sort of privacy first compliance heavy world. Whereas some of the competitors say, "Puppetists, their data propositions are built on cookies and other things which were right for that time." So WPB would argue, but are becoming less relevant now. I think during the presentation, Cindy Rose was really explicit about the fact that there would be some agencies sold. There were some assets in the process of, well, they were going through that process. She didn't give any clues as to which. But there were some unanswered questions still. I think obviously with these £500 million worth of cost savings. And I know, Gideon, in your interview with Cindy Rose, you did ask her, but she didn't provide many details on this about how it might impact people and staff. So what answer did she give? I think every company is pretty sensitive about job cuts for understandable reasons. I think if we go back to this idea that unfortunately WPB has not been performing well for a number of years. By the way, some of the other agents and groups have also been cutting jobs at which we've reported on. But the key thing is WPB cut 9,400 jobs from its head count in 2025. That's a lot of jobs. And their head count came down to just under 99,000. So we know that they've been cutting a lot of jobs. In fact, over two years, they've cut 15,000 jobs from their head count. And they've got a huge number of people going forward. Or by the way, the head count reduction last year, the CFO, Joanne Wilson said there was an 8% cut in the head count. There was a 14% cut in freelancers. So you can see that they are, you know, if revenue was down 5.4%, they were, if you like, cutting ahead of revenue or more deeply. So it's all very tough picture. And they've got to find more savings. And then they're going to come from, I think it's three different areas. It will achieve a total figure of 500 million savings by 2028, all part of this plan they call Elevate 2028. So where might some of these things come from? Well, driving organizational efficiency and consolidating leadership. Maybe there will be fewer leaders as a result of these big groups. By the way, we should say that it going to have four big regions around the world with North America, Latin America, Amir and APAC will some of the country leadership be reduced. I don't know speculating that I'll come back to that. Then there'll be also reducing some of the corporate and support infrastructure in areas such as finance, HR and other back office. We've seen Omnicon talk about a similar thing and they have talked about 4000 redundancies at the end of last year with IPG. They cut 8,000 roles last year. Of course, they're in a middle of a massive merger, whereas WPP doesn't have anything to politely, if I can use this word, disguise what's going on. They can't say, oh, we'll, it's hard to compare because we've got this huge larger company. The final area where they say that there will be some cuts is rationalization and simplification of property. Actually, Cindy Rose said that they own an amazing number of buildings around the world. She said it in her interview with me with a slight tone of amazement as she probably has been going through the portfolio going what we get rid of. They could also pull back in some geographical markets, smaller markets. I think that gives you a sense that they may be able to find savings in a lot of ways and I think they also say that there'll be some natural attrition in a sector that tends to have 20% churn. So there's no disguising the fact that it's going to be a small business, I think, and maybe they're going to have to make people work hard. It's quite a tough picture. What can you say? I think one of the big announcements that came out of it is obviously that WPP is no longer calling itself a holding company but a single company instead. Let's talk a little bit about this and what WP is banking on to make this new strategy work and to turn around its financial reports. For me, it's this idea of really brutal simplicity. I suppose she's calling it a single operating company now. It's this idea that clients can reach all the way through the agency without having to go through silos. And you can see it with WPP creative. She doesn't want to get rid of the agency brands, but she does want to create a single operating system for them. Some people point out to me though that it doesn't get rid of the silo between media and creative. I mean, we've seen it a lot with off-stop my head. I always go back to the Santanderan publicism. That's the one that always comes to mind with the media and creative being together. You see it with all these big clients where they want an integrated operation. Is that truly just what clients want, but they can't all afford to have these like the spoke models where it's all known of it siloed. She's banking on, I think, the idea of simplicity as like a way to appeal to clients. And also, I just want to add Gideon's interview with her. I think she's quite a refreshing leader. I don't know if they're banking on her personality a little, but she said to Gideon, this is the hardest job I've ever had. And I was like, that's so nice to hear. It was nice to see a little bit of a human side to a leader. There was like a bit of a humanness of this is the hardest job I've ever had, but she seems to be relishing it a little bit. That's quite enjoyable to see that you're not struggling, but it's nice to see how you're reacting to the job rather than this corporate jargon that we hear from every single leader. I really enjoyed that. And I think also part of the strategy is obviously the new leader and being like, well, things are changing under her. And she's a like a force kind of thing. Everyone up WPP, who I mean, I've not discussed her at length with people, but everyone is really positive, I think, about her and her impact and her approach. If you compare it to how maybe I'm the calm leaders are chatting about John Rand. Yeah, much more positive. Well, Gideon, as your first interview with Cindy Rose, what did you make of her and what did you make of the whole presentation as well? She's quite down to earth. She has dual British and American citizenship. And she does speak with an American accent. She trained, I think, at a New York Law School earlier in her career. And she has, I think, my reputation, perhaps, from people who make assumptions might be a bit corporate. She's very human. She did impress people who I spoke to. And I think most people watching that she was very fluent in her presentation. And she's very fluent in an interview. And she wanted to be direct. She did say several times she didn't really want to talk about the past, which I can understand. Because, you know, it's not helpful. But she's also, I'm told, very performance focused. And I think that comes across in some of how she's talking. No one could be happy with the performance. But she really wants to change WPP. And I think that's going to be a test for her. I would say, who is she appoints around her will be really interesting. Because someone said to me, for all the newness, it's all the same faces around her at the moment. This is clearly not a short mission. You can't hope to do it all in six months, which is how long she's been there. Obviously, I did interview her. And she had just spent two and a half hours on stage. She also was having to do doubtless many other calls. She did a journalist call before the presentation. And she's trying to tell a new narrative. Even though, let's not forget, she was a non-executive director on the board for six years. So that's interesting. But when I asked her, I said, do you mind if I ask your personal question, how have you been finding the job? And she said, thanks for asking. Because I guess she's on relentlessly on message all the time. And people are expecting her to have all the answers. And she was quite open. And as Maisie said, I think that she has, as I'm sure her predecessor, Mark Reed did, regular town halls and things. But by being an outsider, I guess inevitably she's got a different approach. And let's just remember, there's the holding company world, the CEOs have all been men. Yeah, I mean, I have to say, I was wondering whether to say it or not. But having her followed by Joanne, they both came across very professional and on brief. Yeah, the very impressive speakers, and after the other was nice. They would have been good, you know, regardless of the gender. It's a very blokey world, particularly the room full of financial analysts. I went long to another one of these days. And the gender balance in the room in the world of financial analysis. For whatever reason, it is still very blokey. There's a reasonable mix, but they've got work to do. Perhaps on recruitment there too. But I would say it was very interesting. Because these are you sort of was talking about the whole holding company. And are they not being a holding company? They're moving to a single company. I would say, and I obviously asked Cindy Rose about this when I spoke to her, I just don't know. They've been talking about this for years. And now I appreciate that maybe actually it's the sort of wiring that does need to change. And that the WPP open can be. And maybe is sort of genuine connective tissue. That's the right phrase. I think it's also interesting this reaction. I've heard from some of the people who you might describe as being on the shop floor who are not in this meeting, but WPP people some of them are not sure it's going to change anything. Not a break with the past. Actually kind of going. It still seems to be like additional layer that they're adding. And will it really make a difference to clients. Now I'm not saying they were down beat or being overly pessimistic, but I think it's an organization that has been through lots and lots of restructure already. And Cindy Rose referred to there might be a bit of transformation fatigue in the organization. And she also talked about this idea of changing the culture. That there's not a performance culture. And I think her coming from Microsoft, I've been told she is very performance focused and asking her about whether that was been lacking at WPP. And she said definitely she said a really interesting. I mean, I couldn't really believe that she said it. She said, I don't think as a holding company WPP had a culture. I mean, that is quite a shocking admission in some ways. And I don't know how many people care. I suspect only a small number of people at the top of WPP who've been there a long time might. I know some people would agree with her, but I thought that was quite something. So she really wants there to be a cultural shift internally. First of all, the idea of making at this time the WPP brand from the center of everything is just fine, quite curious because I mean, we're in it every day. But even people outside advertising have heard about WPP because you know, there's some share prices obviously declined a lot and it's been covered in the general business press a lot. So I find it interesting to make a brand which for me is slightly tarnished whether it meant anything to begin with is sort of another question I guess to sort of build on Gideon for the main brand for the future. I mean, treat us to whether there were any discussion or concern about doing that. Now, obviously a brand is what you make it. So if it becomes this kind of collaborative high performance business, then it won't matter. And that's the beauty of transformation and change. But on the point of creating a performance culture, I suppose what I thought was interesting is this idea about looking at incentives and aligning incentives to WPP's performance. I know that when you speak to people of Accenture that they are they're obviously like Accenture in the UK has a single P&L and they are in publicist group might argue the same thing but very good at encouraging collaboration. And one of the reasons is people are personally incentivized to help each other like part of their bonus reflects how collaborative and helpful they've been to other bits of the business. I think they'll be quite interested and see how WPP develops that because another thing she mentioned was that the people who are the kind of global, the big client leaders that their incentives are going to be aligned to the growth of the actual brand company. Often if you give people a target, then it was obviously impact their behaviour. Accenture recently said that they were going to align their pay to use of AI products as well. So I feel like we're potentially moving into this area where our actually businesses are using like a much more sophisticated compensation structure to try and encourage the behaviours that they want to encourage. So we have a little talk about how WPP now compares to its competitors particularly under this transition from a holding company structure and to a single company as we've been talking about. So how does that compare to the likes of publicists and Omnacom at the moment, Gideon? I would say it looks quite similar to Omnacom and possibly quite similar to publicists. It's a really good question about frankly how differentiated WPP is. I came away thinking, well apart from WPP open, in terms of actually it's offering how very different is it. There are lots of things you could pick out. It's still the biggest media buyer just I think in a pack in a mere not in the US where it's the biggest market where it's somewhere behind. I think globally Omnacom is just a bit bigger in terms of media buying. But in terms of its capabilities, you might say their production capabilities are quite good and I think it's been one of the areas which has actually been growing where everything else has been under pressure. It does feel the sort of four units it maps quite similarly to publicists and the four regions maybe. It was quite interesting when the WPP launched WPP production. Obviously we covered it as, did many people. One of the other holding companies came and going to us, like excuse me, we did this two years ago. Can't you write about us? In a way that was quite telling that they weren't claiming anything different from themselves. They were just claiming to having done it first. And actually just picking up on that, one of the people I spoke to at WPP said they thought there might be a perception among clients that they are simply catching up with their rivals. Some of this is the reason for that post that mentioned, which I guess we can link in the show notes, trying to argue why it is different. The publicists went through a big period of transformation in the middle of the last decade basically. And you know, it was arguably struggling in some ways at the time. It made lots of investments in AI, in a Marcel, or Super Epsilon. And now is seeing the benefits. So we'll find out when we get to 2028. How's it been elevated? So yeah, taking a look at this phase one, phase two, phase three, this three year plan that we're going to see unfold in phase two, which is in 2027. The plan is to return to growth. Looking at where WPP is now and the financial results it's just posted. Is this two year turnaround looking realistic? Is it looking likely? I think it is, but maybe I'm too positive, I don't know. I do think they're going to enjoy a more positive wave now personally. If you kind of separate it from the results, because I think that you said to D-Rose during the results focused on like business wins. And those are going to take a while to show up in their growth. But they're winning more recently, talking to network industry people like other networks are overstretched. Maybe WPP isn't as overstretched now, because it's lost quite a lot. Now it's seen as a bit more of an underdog. It's got less to lose, whereas before it had everything to lose. And again, I do think that simplicity narrative is very helpful. Yeah, I think it's realistic. I mean, there's some huge wins there in the back end of last year and into this year, which as Sean said will take a while to go through. I mean, one of the things for me was the, I was trying to account when we were writing a story on the UK numbers. What losses might have been significant to mention, because obviously you would imagine actually losses like sky and lorry L, which were in the year before will have had an impact, potentially a larger impact on 2025 than the losses that happened in 2025 from a media perspective. And so I think Gideon would know better than me, but they've been very relatively vague in terms of the outlook for this year. And clear that the revenue decline will continue. But they've got problem momentum there. If they can maintain that, and when that money starts to come through, that should both work. Yeah, the forecast for this year, 2026 is a bit vague. They've said only that in the first half of the year, they expect mid to high single digit decline and that Q1 will be the worst. They haven't given a forecast for the whole year. So actually, when they first came out with the results on the morning of the presentation, the stock price actually fell quite sharply, because I think the analysts were trying to process that. They don't like vagueness, but I mean, without being too harsh, they've had such a terrible time, if you think that they're likely, because they have said 2026 will be a decline, they're going to likely have dropped 10% on a compound basis revenue terms. If you think that if they can't establish a flaw, if they can't actually start growing in a smaller base, then really there will be major questions about whether Cinderos can save the company to think about the question we're all asking. We're saying, you know, when I was trying, there's always too much to kind of cover in a short interview with Cinderos, but I was trying to think, you know, with Omnicon buying IPG, we talked on previous podcasts, the market for clients has shrunk a bit, right? There's only three really large hold codes, which are sorry, using hold code, the agency groups, publicist Omnicon and WPP and Omnicon itself is distracted with this very big integration. In theory, that actually helps WPP, it means that maybe the new business opportunities are going to just buy the fact that clients have less choice, they may give them more opportunity. So those are things that probably are in Cinderos's favour and I think the Elevate 28 plan stabilise in year one, build in year two, accelerate in year three. I don't think actually it's very stretching, I'm not suggesting it's easy, but time will tell. I do think it's interesting how WPP has also denounced its identity as a holding company, considering when you asked in the Dio Te Accenture song, if they consider the other agency holding companies, their competitors, they said no, brand tech hates to record an agency holding company as well. And it seems like I think you did actually ask this question whether it is an outdated model or an outdated name and people are moving away from that. So it almost sounds like a dirty word now holding company. You want to be considered in that group. I'm not sure it was ever really an inspiring word for say creative talent. There was definitely a sense that if you are under a big umbrella, you've got some protection against the weather if you understand the metaphor. So that I suppose is still the grand idea that by being under an umbrella, you can offer a bigger range of services and so on and so on. The holding company concept is definitely tarnished because all of the share prices of the agency groups, including publicists, the top performer have been really here to the start of February. There was a sort of fears about the latest anthropic, Claude products that this was going to really eat further into not just agencies, but lots of analytics, software companies. That's the environment in which all these agency groups are functioning. And if I may say one last thing on this, Sean has already talked a little bit about how the rest of the market is responding to this. I think this is probably good for Indies because you're not going to buy big you going to buy boutique. Well, as always, we end every episode of the campaign podcast, asking the title question in three words. So, may be shall we start with you will Cindy Rose's plan saved up. I was going to say I hope so and Shawna. I think so. I, you know, yeah, actually, do you know what? Yeah, I'm going to go confident. Yes, it will and good in ending with you. I'm going to go for yes, somehow, it doesn't sound very hopeful. Well, I just think there could still be a surprise package here. There's been the M&A speculation, you know, the share prices very, very low. Okay, the company's valued at three billion pounds and I know it has debt as well, but I wrote last year about how WP needed to seize control of its destiny. And that it is not yet in a position where it is fully in control of its destiny. When it starts growing again, that suddenly makes it more attractive for them to hire for them to buy other businesses to change the profile. I think if they can get growing, then something can happen if they don't get growing, then someone could swoop and who, how, why I just don't, it's hard to predict. Okay, great. Well, thank you all for joining me to answer if Cindy Rose's plan will save WP and what the announcements mean for the no longer holding company and the agencies within it. So thank you. Good bye. Thank you. Thanks, Lucy. Thanks for listening to this episode of the award-winning campaign podcast to read more about what we have been discussing today and to subscribe head to campaign live.co.uk. If you enjoyed this episode of the campaign podcast, please follow us like us and leave a review wherever you listen to podcasts. Thank you to Hey Markets producer Jude Owen. I hope you will join us next time. So on behalf of the campaign team, goodbye. [MUSIC]