MEDIA, DIGITAL AND TECHNOLOGY: THE NEW NORM OF CONSUMER INTERACTION 16 JUNE 2020 INVESTOR SESSION
TODAY’S SPEAKERS NICOLA LEWIS CHIEF INVESTMENT OFFICER, GROUPM TIM MATHESON CHIEF TECHNOLOGY OFFICER ROSE HERCEG CHIEF STRATEGY OFFICER JENS MONSEES CHIEF EXECUTIVE OFFICER 2
AGENDA Introduction Market Trends across Communications, Experience, Technology and Commerce What does this mean for WPP AUNZ’s future? The Centre of Excellence Our competitive edge 01. 02. 03. 04. 05. 06. Q&A 3
4 MARKET TRENDS ACROSS COMMUNICATIONS, EXPERIENCE, COMMERCE AND TECHNOLOGY NICOLA LEWIS CHIEF INVESTMENT OFFICER, GROUPM
Source: 1 GroupM: e-marketer 2019, ZD net 2019, Statista 2019, Gartner Consulting 2018-2020 Note: the data is taken pre-COVID-19 LOW GROWTH DOUBLE DIGIT DOUBLE DIGIT GROWTH CONSULTING c. $7.37 billion market 1 5 THE ENHANCED MARKET IN WHICH WE OPERATE GROWTH DOUBLE DIGIT Combined c.$1.9 bn market 1 TECHNOLOGY COMMERCE EXPERIENCE COMMUNICATIONS GROWTH c. $17.2 billion market 1 c. 1.5 bn market 1
COMMUNICATIONS reality patents EXPERIENCE Key categories are exploring the impact of augmented reality (AR) and virtual reality (VR) with solutions that make it easier and safer to shop, including; Contactless payments, virtual assistants, ‘Smart Mobile Onboarding’ and chat bots dedicated to a better consumer experience The changes needed in Technology are strategic The rapid growth of ecommerce (up ~50% in 2020), has expedited growth and will have a long lasting impact as we move out of COVID. Four principles for consideration: Cloud Anything-as-a-service Rapid Automation in already growing market Australia at its highest ever level of online as a % of retail sales (10.4%) on the achievement of cross category efficiencies advantage of market opportunities, specifically to COMMERCE TECHNOLOGY THE NEW NORM ACROSS OUR MARKETS 6 Communications strategies focussed on optimising efforts towards the consumer Many sectors are increasing spend to take Agile Operating Models entertainment and Automotive Individual channel developments will be predicated Technology, Sport, Banking, In home focus on building long-term brand equity • • • • • • • • • • • • • Australia is now the 7 th fastest growing region (worldwide) for extended
OBSERVATIONS: COMMON TRENDS ON A GLOBAL CPG LUXURY FINANCE digital executions including virtual showrooms SCALE AUTOMOTIVE subscribers and usage TELCOM AND MEDIA 7 • SVOD Service increasing both subscribers and usage • Telcom companies benefit from less churn, more stickiness • Media companies reliant on at-home consumption and fee-based models are positioned to thrive, with SVOD services increasing both • CPG companies have benefitted from ‘pantry loading’ behaviour and a surge in e-commerce • Many packaged goods companies are conveying plans to sustain spending over the course of the year • Global auto trends were weak for the first quarter • Total Industry Volume (TIV) registered a -40% decline in March year-over-year • Many auto manufacturers have focused their near-term marketing on digital media only in support of efforts to invest more aggressively in • Fast adoption of digital tools among banks, including Smart Mobile Onboarding (SMO) for customers, and enhanced online banking capability • During the most recent quarter Citi referenced international growth of +18% for digital and +30% for mobile • Luxury products are highly dependent on public life and travel. Few or no events means fewer reasons to use/consume luxury products • Early evidence from China suggests a rapid returns to growth in the luxury category when retail venues open
8 WHAT THIS MEANS FOR OUR FUTURE JENS MONSEES CHIEF EXECUTIVE OFFICER
OUR TRANSFORMATION ROADMAP (ANNOUNCED FEBRUARY 2020) 9 Clients Operating Model Talent Solutions Geographies Platform TRANSFORM STRENGTHEN GROW A LEADING CREATIVE TECH COMPANY 2020 - 2022
PROGRESS - DONE seek growth opportunities through attractive, strategic M&A Auckland and Wellington DONE ON TRACK ACCELERATED ON TRACK system, one HR system and one Finance ON TRACK ACCELERATED ACCELERATED ACCELERATED ON TRACK 2020 DELIVERABLES STATUS FEBRUARY TO system DONE GEOGRAPHIC MAY 10 OPERATING MODEL CLIENT FIRST TALENT PLATFORM SOLUTIONS PRESENCE practice areas • Reinvent our operating model • Establish integrated Centre of Excellence • Establish top client leads and sector • Roll out new agile leadership model • New KPIs and REM model • Begin to centralise our services with one CRM • Start to build an end to end data tech stack • Invest in partnerships with tech platforms and • Establish a campus in Perth, Brisbane, Adelaide, • Restructure NZ • Explore growth options in SE Asia
EXPERIENCE Partnerships Shared Services Integration of systems CRM system Content studio consolidation Selective M&A End to end data tech stack Thought leadership Tech Hybrid campus KPI’s/ REM Restructure NZ SEA Growth Strategy Offshoring Up-sell Industry Practice Automation Scalable APIs Active portfolio management Digital talent Career paths HOW THESE FIT ACROSS OUR SOLUTIONS PILLARS Simplification 11 Strengthening the Core Growth Opportunities Operating Model Clients Talent Platform Solutions Geographies Connected solutions Workflow efficiency portfolio CoE (Data, MarTech, AdTech) New leadership team and reporting lines Cross-sell Foster Creativity Top Clients Consulting New Culture & Leadership Future fit program
WE ANNOUNCED THE CENTRE OF EXCELLENCE IN MAY WHY? in the areas of technology and data analytics to support our client transformations integrate solutions to be scaled across all brands 12 DATA/AI CONSULTING MARTECH/AD TECH CENTRE OF EXCELLENCE • Our agencies need a depth of expertise • Tech hub which will develop and
13 CENTRE OF EXCELLENCE: MARTECH, DATA AND CONSULTING TIM MATHESON CHIEF TECHNOLOGY OFFICER
THE FUTURE OF THE CMO “CMOs need to have a well-rounded balance of traditional marketing skills like branding and storytelling, as well as newer technical skills to harness data and technology to execute performance marketing”. EMARKETER 14
HIGH GROWTH IN MARTECH 1. Martech 5000. chiefmartec.com 15
EVOLUTION TO OPEN PLATFORMS Platforms evolving to open platforms. With app marketplaces allowing the creation of even more apps. Hubspot open platform has over 350 app partners. All major tech players have launched their app exchanges: 16 • • •
ADOPTION OF HEADLESS & APIS Driving innovation with customer experience by making integration across technologies possible 1. Image source Contentful 17 • Headless CMS • Headless Commerce • APIs fuelling growth beyond webpages
ADOPTION OF HEADLESS & APIS 1. Forrester. Accelerate Microservices Adoption 2020 2. Linkedin. 2020 Emerging Jobs Report 48% business intend to use microservice architecture in 2019 – Forrester Full stack engineers are #4 in LinkedIn emerging job (35% YOY growth) 18
INCREASED VALUE OF OWNED DATA single customer views and provide business eMarketer 2. Martech 5000. chiefmartec.com 1. Brands feel just 47% of first party data value potential realised. performance data. data literacy to understand identities, manage Marketing teams require increased amount of deliver and optimise their activities. data. Marketing teams need data to design, placing increased in value in brands owned 25% in 2019 is hitting challenges with privacy The growth of data marketing solutions, up 19 • •
DATA LITERACY NOW CRITICAL FOR MARKETERS Responsibility for generating trust falls with marketing teams. Trust provides permission for marketing teams to deliver richer experiences for customers using their data. 1. BCG. Responsible Marketing with First-Party Data 20 • •
THE CENTRE OF EXCELLENCE DEVELOPMENT CENTRE OF TECH MARTECH/AD CONSULTING DATA/AI CENTRE ENGINEER 21 ECOSYSTEM EXPERT LABEL SERVICES DESK AND WHITE WITH FRONT BUSINESS UNIT EXCELLENCE
22 OUR INTEGRATED AGENCIES ARE WELL RECOGNISED BY CONSULTANCIES THE GARTNER MAGIC QUADRANT FOR GLOBAL MARKETING AGENCIES, 2020 WPP AUNZ brands
COE PLAN FOR GROWTH program 23 Productising WPP core technology offer - white labelling to all brands Consolidate offshore development hubs Scaled enablement and retention CRM program to market and CRM drive organic and acquired growth Launch productised solutions Selective acquisitions to complete offer Grow capability onshore and programs offshore Joint partner go-to- partner program credentials Establish strategic Connectivity internally - hub and spoke ESTABLISH (H1 2020) Training and enablement program CONNECT (H2 2020) GROW (2020 ONWARDS ) Identifying specialisation and white space opportunities Certifications and • • • • • • • • • • • • •
OUR COMPETITIVE EDGE ROSE HERCEG CHIEF STRATEGY OFFICER 24
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