WPP, the world’s largest advertising company, has just revealed Google is its biggest partner, in terms of where it plugs its clients’ advertising money. And it’s WPP’s biggest media partner by quite some way.
Speaking on the company’s fourth quarter earnings call, WPP chief executive Sir Martin Sorrell gave some interesting nuggets about the company’s media outlay last year.
“Google has become our biggest media partner,” he said. Last year WPP invested $US2.9 billion of its $US75 billion media bookings into Google ads.
That’s massive. Put that another way, nearly 5% of the (as-yet unaudited, and not a direct apples-to-apples comparison as the two companies have different reporting periods) $US59 billion in advertising revenue Google reported last year came from WPP.
As one mobile executive summarized to Business Insider on Twitter:
By comparison, here’s where else WPP was spending the majority of its clients’ digital advertising budgets this year:
- Facebook: $US640 million
- Yahoo: $US400 million
- Twitter: $US150 million
- AOL: $US100 million
Later on in the call, Sorrell spoke about the kind of things that keep him up at night in terms of their impact to WPP’s business.
“The G-word has not receded, I still worry about disintermediation,” he said. By “G-word,” he means Google.
In the past Sorrell has referred to Google as a “frenemy”: A company that is carving off chunks of its revenue, yet one it has no choice but to partner with given its scale and other benefits. To combat that threat, Sorrell said WPP is adjusting its business to be “digital everywhere” — which means adding digital expertise across its traditional businesses, but also partnering and investing in other digital companies like its $US25 million investment in adtech company AppNexus earlier this year.
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