Global economy ‘less worse’, but not in recovery just yet, says Sorrell
Sir Martin Sorrell, chief executive of marketing communications group WPP, has played down the economic recovery, describing the global situation as “less worse”.
Speaking to Bloomberg, Sir Sorrell said media companies in particular are coming out of the economic crisis with like-for-like sales down between five to 10 per cent, instead of being down by as much as 30 per cent.
But while many are declaring it as a “victory”, Sorrell said: “I’m not so sure that we’re seeing that much of a recovery. We describe it as being less worse.”
“I still think in the second quarter we’ll see probably positive growth, but that’s basically because we’re cycling easy comparatives,” he said.
“But you can’t declare victory until you see consistent gains year to year and that’s where we will see the recession being over. And my guess is we’ll see that as we cycle through 2010.”
Sorrell added the situation in Western Europe remains tough, particularly in France, Germany, Italy Spain and the UK. The US is recovering “more significantly less worse than Western Europe”, while Asia, Latin America, the Middle East and Central and Eastern Europe are “much stronger”. However, countries such as Japan are still suffering.
In Australia, RBS Equities last month upgraded its advertising revenue forecast for the year, predicting a 6.7 per cent uplift in the first half.
Sorrell said that online activity continues to grow and WPP, which owns agecny groups inclduing Group M, JWT, Ogilvy, TNS and Added Value, is also seeing its consumer insights business becoming “more important”.
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