Today, WPP finally confirmed what others have reported for days (or even months): Mark Read, formerly CEO of Wunderman, will lead the world’s largest advertising company as CEO, effective immediately.
This ends the four-and-a-half month search to replace Martin Sorrell, who spent 33 years at the helm before resigning amid a storm of controversy in April.
Andrew Scott, the former head of WPP Europe who was promoted to co-COO along with Read upon Sorrell’s departure, will retain that title and lead the company’s operations on a global scale. Roberto Quarta returns to his role as non-executive chairman.
“The Board carried out a rigorous selection process, assessing internal and external candidates,” Quarta said in a statement. “That process, alongside Mark’s wise and effective stewardship of the business in the last few months, left us with no doubt that he is the right leader for this company, and we are delighted to announce the Board’s unanimous decision to appoint him as CEO of WPP.”
Quarta proceeded to praise Read’s “intimate understanding of the business,” his “strong internal support” and his ability to earn the “endorsement of our clients with his constant focus on their needs” while also citing his experience turning Wunderman into one of WPP’s most profitable agency networks.
“WPP is a great company with exceptional people and strong relationships with clients who place a high value on our work,” said Read. “Few organizations have our global reach—130,000 people delivering results for clients in 112 different countries. Fewer still have our powerful combination of creativity and expertise in technology and data.”
The announcement precedes tomorrow’s half-year results call. WPP finds itself at a crossroads, facing threats on all sides from digital behemoths like Google and Facebook; clients demanding more for less; and up-and-comers, like Sorrell’s own S4 Capital, that seek to chip away at the business of the biggest names in the industry.
Recent developments on the new business front have amounted to a mixed bag for WPP, which scored significant wins in the global media reviews for packaged goods giants Mars and Mondelez but now faces a significant threat as its largest client, Ford, has chosen Wieden + Kennedy to handle the most visible portion of its advertising account.
“Our industry is going through a period of structural change, not structural decline, and if we embrace that change, we can look ahead to an exciting and successful future,” Read’s statement continued. “Our mission now is to release the full potential that exists within the company for the benefit of our clients, to accelerate our transformation and simplify our offering, and to position WPP for stronger growth.”
He concluded: “To achieve that, we need to foster a culture that attracts the best and brightest: inclusive, respectful, collaborative, diverse. What makes our company special is its people, and I am very proud to have been given the chance to build a new WPP with them.”
Sorrell sounded a slightly bitter note in response to the news, confirming that he sent both Read and Scott a congratulatory message and stating that he had planned to hand the reins of his company to the two executives simultaneously.
“I am sure they can be very successful, as a twosome,” Sorrell wrote. “Ironically, this was exactly the succession plan agreed on April 3 before the Wall Street Journal leak, except Mark and Andrew were to be joint CEOs. I believe Andrew is an exceptionally strong executive.”
He also openly criticized the appointment process, writing: “Unfortunately, we have wasted exactly five months arriving at the same point at a time when there are many challenges, such as our biggest client being in review. I wish them both the best of good fortune.”
On the salary front, Read will, as speculated, earn less than his predecessor, whose $26 million “exit package” led to an investor revolt earlier this summer.
His base salary will be just over $1.25 million, with a potential 250 percent bonus and a five year long-term incentive plan equivalent to 350 percent of the same total. Perhaps most significantly, Read’s contract—unlike Sorrell’s—includes an industry noncompete clause.
Greg Paull, principal and co-founder of international consultancy R3, said Read brings “a generation’s head start on Sir Martin” to the position due to both his age and his extensive experience in the digital realm. Paull referenced an unnamed, recently-completed global review that amounted to a big win for Wunderman, adding that “it’s clear he’s helped build a strong data-centric team that’s ground zero for WPP’s future.”
“His challenge will be to continue to invest more time in the U.S.—particularly with clients like Ford—where relationships and stability are important,” Paull added.
Tom Denford, co-founder of competing consultancy ID Comms, agreed in a recent tweet.
Mark Read earned an economics degree from Trinity College at Cambridge University and participated in Harvard University’s Henry Fellowship, joining WPP in a corporate development role in 1989. He later earned an MBA from business school INSEAD, founded and sold an online loyalty startup called WebRewards and became a principal at information technology consultancy Booz Allen & Hamilton before moving up the ranks of WPP as strategy director and digital CEO. He was handpicked to lead Wunderman in 2015.