Holding Company Chiefs on How the Economic Downturn Measures Up to 2008's Recession

It's still uncertain how the current economic uncertainty will shake out and whether there will be any parallels to the 2008 recession. Leaders are hesitant to draw comparisons to 2008 for a variety of reasons, the largest being the extent the industry has changed since then. But they agreed there are indeed some parallels—namely, a need for marketers to adapt their strategies on the fly and embrace ROI-driven marketing to make every invested dollar count. Holding companies are better prepared to deliver on those needs now than they were 14 years ago, but it remains to be seen how much their ability to target consumers will actually help margins and prevent layoffs. Here's what chiefs at several top holding companies had to say (interviews have been edited for clarity and length): Yannick Bolloré, CEO and chairman, Havas Group "The Covid-19 crisis, which was even more radical and unexpected, is an interesting parallel. We had to act with agility toward an ever-evolving, unprecedented situation. As was the case in 2008, to survive, brands had to reconsider their messages, reposition themselves and commit to transparency, simplicity and value. Through this experience, we have acquired an incredible sense of adaptability, and brands have learned not to cut investments as soon as times are difficult because the struggle to regain lost market share is tough, if not impossible." Philippe Krakowsky, CEO, IPG "I think we're going to see the same kinds of shifts [as we did in 2008]. We're going to see shifts to performance media; we're going to see a focus on ROI. The difference is that holding companies [have] been making a series of investments over a number of years that mean we're better prepared for [a recession]. We have more presence [and] capabilities. Our business mix already contemplates where you've got a data layer in your organization, where you've got connectivity between data and technology, and different parts of the portfolio." Mark Penn, chairman and CEO, Stagwell "Mostly we just battened down the hatches, cut the discretionary spending, held the parties, put in your basic hiring freeze, pushed raises back a little bit [in 2008]. It was mostly 'bring your body parts into the turtle shell and just wait until it passes.' At the end of the day when you really hit one of these recessions, it doesn't throw you off your plan. It just delays your plan a year; 2010 was the 2008 or 2009 that I really wanted." Arthur Sadoun, CEO, Publicis Groupe "Although the crisis in 2008 was of a very different nature to the one in 2020, we were guided by the same priorities when facing both. First, prioritizing our people and making sure we preserved as many jobs as possible by being extremely flexible in resource allocation. Second, being there for our clients in those challenging times. And last, making the necessary changes in our organization and in our go-to market to recover quickly." Martin Sorrell, founder and executive chairman, S4 Capital "By March 2009, America was in shape. Europe took a longer time because Europe is much more rigid, and the social costs of cutting people are greater in France, Germany, Italy [and] Spain. Our philosophy is to try and keep the fabric intact, despite the pressures, and try and find alternative revenue sources. The revenue sources to focus on are lower-down-the-funnel activation and performance. And then secondly, digital transformation."