Ad giant WPP hiked its its full-year sales outlook this morning following booming online demand despite shrinking woes for consumer budgets for major brands.
The owner of the Ogilvy and GroupM agencies now expects full year revenue to rise 5.5-6.5 per cent, up from previous expectations of five per cent.
It comes after first quarter net revenue rose 9.5 per cent on a like-for-like basis to £2.6bn, reflecting growth in all business areas and geographies.
Crucially, WPP said that the group had been able to post immense growth despite rising costs for clients.
WPP cited Coca-Cola as one client that had not cut back its advertising spend, despite the cost of living crunch and the uncertain geopolitical landscape.
Lead Equity Analyst at Hargreaves Lansdown Sophie Lund-Yates commented that WPP had once again shown that it was “spinning the digital wheel of fortune”.
“Having successfully realigned itself as a digital marketing powerhouse, the media giant is reaping the rewards with net revenue growth almost hitting double digits in the first quarter”, she said.
“This is an important pivot because above-the-line marketing is very expensive compared to digital tactics, and is therefore the first to get cut from marketing budgets when the economy sours. WPP will not be immune to this – it still has a lot of fingers in traditional-marketing pies.”
The company is also close to finalising the sale of its Russian business to local management teams, with chief executive Mark Read telling the Financial Times that the sale was “substantially complete”.
Read replaced WPP’s founder Sir Martin Sorrell in 2018 and has been working on simplifying the group’s business model.