WPP CEO Mark Read Talks Energy Clients, the Metaverse and Coca-Cola

“We are there to support them on that transition,” WPP’s chief executive Mark Read said of the company’s continued work with fossil fuel-burning energy companies. The agency network has come under scrutiny following the launch of its own sustainability movement internally while growing scrutiny of “greenwashing” ads has also emerged. Read was speaking to analysts about the company's 2021 financial results, which saw WPP post annual organic revenue growth of 6.5% to $13.9 billion (10,397 billion pounds) and also beating organic growth from 2019 by 2.9% ahead of pre-pandemic conditions. Media business GroupM delivered 36% organic revenue growth alone. During the analyst call, Read was questioned about WPP’s work with “energy clients,” as he described them, which includes Shell, BP and Chevron through its network of agencies. Having spoken earlier in the call about the importance of purpose to WPP, Read was questioned about why the firm continues to work with such clients. Energy companies were beginning to make changes, he claimed. “We want to work with companies that share our values and share our outlook for the future and energy companies are in the process of doing that," he said. We do look at clients we work with, and there are clients that we have declined to work within that sector.Mark Read, chief executive, WPP While he admitted the companies might not be moving “at the speed and pace, which would please all commentators,” he added \he believed they were “shifting their investments” towards more sustainable practices. Read also conceded that such firms had to communicate in a “fair and accurate” way that does not involve “greenwashing” by implying they are taking environmentally beneficial steps that are not accurate. “That's increasingly difficult to do if you want to do it in a much more sort of transparent and social media-led world,” he continued. “For us at WPP, we do look at clients we work with, and there are clients that we have declined to work within that sector." Read also highlighted that the work from the company aimed to “conform to the highest standards of fairness and accuracy,” including training being provided and discussions with clients on their plans. “I think that as we continue to work on this transition, we should be there to support them on that on that transition," he said. How much will the Metaverse matter? WPP has also announced the formation of a dedicated business to producing work for clients around Web 3.0. “The Metaverse Foundry” will be a 700-strong consultancy of creatives, producers, visual artists, developers and technologists run within creative-production agency Hogarth, which was already focusing on the virtual world space. The business is working with clients such as Wendy’s, Under Armour, Duracell, Pfizer, Pizza Hut and Bombay Sapphire. However, Read also revealed another project being undertaken through VMLY&R, working with EMI and music band Bastille—in partnership with Epic Games and Microsoft—to take their new album into a virtual world. Using 3D cameras, the band has been recorded performing the new album in the virtual environments that have been created and can be accessed by users through a virtual reality headset. People are spending more time in these virtual environments. It's easy to be cynical about it ... it’s very hard to judge exactly what the impact will be. Asked about the potential for the Metaverse, Read cited the rebranding of Facebook to Meta as having “captured the world’s imagination” around the growing space and discussed whether it would grow advertising spend or take away from elsewhere in media. He cited a project with Under Armour that was released in December to celebrate Stephen Curry’s three-point record-breaking feat, the “Genesis Curry Flow,” which saw the release of 2,974 NFT sneakers which he was seen to wear in the project, that sold out. All revenue was donated to organizations that supported gaining access to sport—generating around $3 million as a result, with four-and-a-half million consumers engaging with the activation—despite spending nothing on media to promote it. “I wouldn’t necessarily call it additive, but I would call it incremental in that it reflected the growth in fee in relation to paid media that we see in our business,” he reflected. “If you think about where the trends are going, where the innovation is going, I think people are spending more time in these virtual environments. It's easy to be cynical about it, just as people were cynical about people watching video on mobile phones 10 or 15 years ago, it’s very hard to judge exactly what the impact will be.” The impact of Coca-Cola Predicting business growth of 5%, Read admitted that winning the Coca-Cola pitch last year gave the business confidence in achieving such a target—and expressed that the shift towards media spend was “at the heart” of its pitch to the world’s largest drinks company. WPP's slide outlining its relationship with Coca-Cola. “If you look at the relationship that we're building with the Coca-Cola company it's, in many ways, the type of relationship of the future and the type of relationship we want to have with our clients,” he said, explaining the growth in demand for technology and data by clients. “An amazing number of clients have asked to talk to us since that about what it means and what they're trying to achieve. What they're saying is that creativity and ideas remain critical, but they also need to have global partners that will reach a breadth of scale to be able to execute those around the world—as well as an understanding of how to use data in their marketing and how technology is changing the way they reach consumers.” Read also acknowledged the 200 members of WPP staff based in Ukraine and, without going into detail following the initial stages of an invasion by Russia, added: “It’s not the right time to understand the impact of what is happening in Ukraine for the year, although it’s obviously a concern.” How Coca-Cola's Mammoth Agencies Review Is Impacting the Industry