WPP, the world’s biggest advertising agency holding company, spent huge amounts on advertising with the largest global digital media giants last year.
Speaking to Business Insider at the World Economic Forum’s Annual Meeting in Davos, WPP CEO Sir Martin Sorrell listed the ever-growing amounts the company has been spending on behalf of its clients with Google, Facebook, Yahoo, Twitter, and AOL.
Here are the figures, for 2015:
Google: $US4 billion (up 38%, from $2.9 billion in 2014)
Facebook: $US1 billion (up 56%, from $640 million in 2014)
Yahoo: $US400-430 million (flat or slightly up on $400 million in 2014)
AOL: $US100-125 million (flat or slightly up on $100 million in 2014)
Twitter: $US150-225 million (flat or slightly up on $150 million in 2014)
Snapchat: “Much smaller”
WPP will likely provide the full details during its preliminary 2015 full-year results on March 4.
Here’s how WPP’s digital media spending stacked up last year.
The rankings haven’t changed, but it’s interesting to see just how much WPP’s spending on Google and Facebook has increased year-on-year — particularly Facebook, where spend likely spiked due to Instagram seriously ramping up its monetisation over the past 12 months. It’s an incredible sign of confidence in their advertising offerings.
We don’t have full-year results from Google or Facebook yet. Analysts expect Facebook to report revenue of $17.45 billion for 2015, which would make WPP (on behalf of its clients) responsible for about 6% of that. Meanwhile, analysts are estimating Google will generate $74 billion in revenue for 2015, making WPP ad spend responsible for around 5% of the total.
Sorrell said, going forward, he expects WPP will spend more with AOL in 2016 following Verizon’s $4.4 billion acquisition of the digital media company last year.
“I think Verizon will be aggressive. Obviously Lowell [McAdam, Verizon chief executive officer] and [Diego] Scotti [Verizon chief marketing officer] are changing Verizon, obviously as a result of what they are doing with companies like AOL. Tim [Armstrong, AOL chief executive] staying there is a good signal. It’s likely they will grow quite rapidly,” Sorrell said.
In its last annual earnings, WPP predicted digital advertising will account for 40 to 45% of its revenue by 2019.
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