Sorrell warns rivals: 'Don't climb the backstairs of the Carlton in Cannes'
Sir Martin Sorrell, the founder and chief executive of WPP, revelled in the collapse of the proposed $35 billion Publicis Omnicom Group in Cannes this week.
Sir Martin Sorrell: Cannes 2014
Speaking a year after Publicis Groupe’s chief executive, Maurice Lévy, reportedly summoned Omnicom’s chief executive, John Wren, to a clandestine meeting about the merger at a French Riviera hotel, Sorrell said: "The moral of the story is: don’t climb the backstairs of the Carlton in Cannes."
The leader of the world’s largest marketing services group dismissed talk of a "clash of cultures" between the French and US holding companies, attributing the breakdown in negotiations instead to "a clash of egos and lack of planning".
Sorrell said: "I do find it bizarre. For Maurice to indicate that he hadn’t, prior to the announcement, sorted out who was to be the chief financial officer. That’s investment banking 101."
He added: "Just to show how rapidly it came unstuck, I was told in November they hired an eminent New York investment banker to go in and try to negotiate a Kissinger-like rapprochement between the two CEOs – this is having made the announcement in July." His conclusion was: "If you thought investment bankers were bad, these advertising guys take the biscuit."
Lévy and Wren had claimed they would save €500 million (£430 million) by uniting the companies and its combined 130,000-strong global workforce.
Sorrell added: "Clearly, when Maurice said to John 'this could all be yours', he omitted to qualify about when it will be his. I think that very phrase, which Maurice did actually say he said, would indicate to John that it was going to be his – the only question was about when."
He also claims WPP has benefited, and continues to benefit, from unsettled clients leaving the two rival groups since talk of a merger began and, arguably more significantly for the longer term, the migration of senior talent.
Sorrell said: "We’ve tracked it since the POG announcement. [The ratio of people moving from POG to WPP and vice versa] got as high as seven to one; it’s now settled at four to one… They’ve had some significant departures."
Now that the threat to his position of global marketing leader has subsided, does the 69-year-old who founded WPP in 1985 feel any temptation to wind down?
"I don't need a good reason to get up in the morning," he said. "We started this thing 28 years ago. And we've had our ups and our downs. Every day, you have good things that happen and you have tough things that happen. I'm still full-on."
Sorrell is also keen to point out the fundamental difference between the relationship he has with his business to that of his rivals.
He said: "Maurice Lévy did not found Publicis Groupe, John Wren did not found Omnicom, Michael Roth came into IPG. [Havas' Vincent] Bolloré is a founder, and he's in a dynasty with his sons – so that's probably the closest parallel.
"If you're a founder of something, you give birth to an idea. It's as near as a man can get to giving birth. It was 28 years ago... we're now capitalised at close to $30 billion, and our two biggest competitors are at $20 billion."
So, will he still be leading WPP in five years' time?
"That's not for me to decide," he said. "It's for others to decide. I've always said it depends on performance. If the company's not performing well, obviously somebody will take me out to the woodshed and say: 'Martin, it's time to go.'"
WPP's leader, who earned £29.8 million last year, a rise of 70 per cent year on year, did acknowledge that such a scenario, in practice, might prove less easy than it sounds.
"The problem with founders is that, because they are so wedded to what they've done, you have to prise them out," he admitted. "But the other thing is that it's like the Bill Shankly quote: WPP is not a matter of life and death, it's more important than that."
This article was first published on campaignlive.co.uk
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