Coronavirus will ‘accelerate the digital revolution’, says ad mogul Martin Sorrell
The outbreak of coronavirus will “accelerate the digital revolution” as businesses and consumers become increasingly reliant on technology, ad boss Sir Martin Sorrell has said.
Sorrell, who runs ad fim S4 Capital, today said the “bottom line” of the crisis was that digital transformation would move at a much greater pace.
“Businesses that were probably hesitant to move forward on digital because things were going reasonably well and they didn’t really want to disrupt things, that’s now out of the window,” he told Sky News.
Sorrell added that companies should take the opportunity to “get the bad news out of the way now”.
“If you have historic costs to write off, get it out of the way now and accelerate your digital transformation,” he said.
While the adland veteran said coronavirus was yet to have a material impact on S4, he admitted that full effect was yet to be felt.
“I would expect the ripple effects — or the tsunami effects — of the Chinese virus spreading into western Europe and the US will probably affect our clients, and therefore us, as we move into the second and third quarters.”
Sorrell, who was speaking from S4’s offices in central London, said consumer habits would also shift as a result of the crisis, but dismissed the idea that home-working would become “engrained”.
It comes a day after S4 Capital posted full-year revenue of £215m, up 41 per cent on 2018. The firm’s pre-tax loss was £9.2m, compared to a £9.1m loss the previous year.
Sorrell, who founded S4 after his acrimonious departure from WPP, said the company’s Chinese operations were closed for most of February due to the virus but have since reopened.
Shares in S4 Capital were down almost eight per cent today.
Sorrell said the company was “firing on all cylinders” and was on track to meet its target of doubling revenue and profit by 2022.
S4 made seven acquisitions in 2019, including its $150m (£129m) takeover of Silicon Valley digital marketing agency Firewood.
In January the firm said its Mediamonks division had also snapped up Latin America-based digital agency Circus Marketing.
S4 has grown to 2,500 staff across 30 countries and has secured clients including Google, Amazon, Netflix and Facebook.