WPP chief executive, Sir Marin Sorrell, has urged media companies to start investing, not cutting down, during the credit crunch.
Speaking to Media Week, Sorrell said: “Industry research has consistently shown that if we cut marketing during such times, the impact is damaging and it can take you longer to get back to where you were.”
Sorrell said “that when times are tough, it’s the time to invest not cut,” the same day as WPP announced its deadline extension for TNS shareholders to accept its £1.1 billion takeover offer.
WPP, currently active in more than 100 countries across the globe, is experiencing near double-digit growth throughout Asia-Pacific, Latin America, Africa, Middle East and parts of Central and Eastern Europe.
However, Sorrell recently warned that the economic crisis is likely to last through 2009, though predicted that things may improve in 2010.
He said a recovery, “which will be as rapid as the decline in confidence”, could happen due to the 2010 football World Cup in South Africa, the US mid-term elections and the Shanghai Expo.
Sorrell has urged companies to resist the temptation to start slashing budgets now, saying: “Of course, it’s easy to say, but harder to do.”
“The Pavlovian reaction is to cut, but I think the media industry can learn from someone like Rupert Murdoch, who historically has never done that,” he added. “You’ll see him investing in editorial and products at a time when other people are throwing the baby out of the bath water.”
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