Jens Monsees, CEO of WPP AUNZ, is looking at acquisitions as he continues his transformation program, a process now accelerated by the pandemic.
Staff are back on full pay, business has picked up and Monsees has just released a September quarter update to the market with better than expected numbers.
And advertisers have returned hard, putting in orders for the busy Christmas market. The normal Christmas business is kicking but, with Victoria's extended lockdown, the orders came in late.
“The ecommerce parts are very busy,” Monsees says. This includes Bunnings, Uber Eats and eBay.
“The orders are coming in and it's busy but I don't think we will reach the same Christmas business as 2019,” he says.
Last week WPP AUNZ released an unscheduled trading update.
“I want to be closely connected to the investors and they were very happy that we did the detailed update,” he told AdNews.
“The market is still down 27% (overall agency bookings) and our top line is down 14.3%. So we are also by far outperforming the market and that is a really good achievement. I’m very proud of my team.”
WPP AUNZ has weathered the pandemic storm well, quickly making spending cuts, gathering cash and preparing for bad days.
Headline earnings before interest and tax (EBIT) for the third quarter hit $24.6 million, outperforming the same three months last year by 15.4%.
The result was driven by better than forecast net sales, operational efficiencies and government subsidies.
Net sales came in at $153.6 million, an improvement on the June quarter but behind the same quarter in 2019 by 14.3%.
Monsees is actively looking at acquisitions as a growth driver.
“I obviously cannot share details right now, but we obviously talked a lot about the growth areas of tech, digital and experience, and also ecommerce,” he says.
“And that might be in the future where we can acquire very strong teams, but also some additional business.”
WPP, the global holding company with a majority stake in WPP AUNZ, is also looking at acquisitions. CEO Mark Read told analysts last week “We need to focus on both organic growth and growth by acquisitions.”
In Australia, Monsees says the company has moved a bit from the traditional holding company into more consulting, along the lines of Deloitte and Accenture.
He sees a more sustainable business rather than project work where the work is done and then moves on to another client project.
“We believe that there are three big areas in this space,” he says. “One is the martech-adtech implementation but also IT consulting. So how is your data space? How do you tap into your current CRM data? How you then blend it in with the media data, from smart TVs, from Google, from the Facebook pod, and really make a real-time operations out of it.
“The third pillar is the content and creative plate, because you want to bring the exciting and relevant message to the users at the right time and via the right channel.
“And that is based on the data and on the marketing clouds. So it needs to be all interlinked and we feel very strongly to keep that middle ground between the classical holdcos and the IT implementers.”
Outlook
Next year, Monsees will continue to drive transformation.
“We will further invest into the tech space, the digital experience space, and ecommerce,” he says.
That might mean an acquisition or organic growth.
There will also be a lot of investment into our people, to catch the future skills of technology, martech, adtech and digital experience.
And WPP AUNZ might also go out and seek specific talents.
“All three options are running in parallel because I think we can cover the fantastic middle ground between the consultancies and the traditional holdcos,” says Monsees.
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