WPP Is Making Progress, but It Continues To Lag Rivals

WPP has traditionally generated revenue by shepherding advertising campaigns from idea through placement across outlets like television and radio. Over the past 20 years, however, digital advertising has grown far faster than traditional media, to the point that digital ad spending now comprises 70% of total ad spending, up from 40% in 2016. This shift has created an opportunity for agencies with the most robust consumer identity graphs to improve campaign targeting. Unfortunately for WPP, we believe its approach to orchestrating client data is inadequate compared with Omnicom and Publicis. The lack of a competitive data solution is likely to keep WPP's value proposition at a relative disadvantage and keep its shares at a persistent, but appropriate, discount to its rivals.