Wpp Plc · LSE:WPP
Wpp — Investor Day (April 2011)
37 slides from Wpp's investor day presentation, Apr 7, 2011
Slide 1: WPP Investors Day – 07/04/2011
WPP INVESTORS DAY – 07/04/2011
Slide 2: Rebranding and Integration
REBRANDING AND INTEGRATION ERIC SALAMA
Slide 3: The Way We Were
\\ Coocoms) CENTER| PARTNERS Se . Glendinning Kantar Operations MATTSONJACK |B} & MillwardBrown health Kantargroup
Slide 4: Kantar Is... A House of Brands
KANTAR IS... A HOUSE OF BRANDS 4
Slide 5: Peer Group Revenues Full Year 2010
PEER GROUP REVENUES FULL YEAR 2010 6.0 5.0 Revenue (USD Bn) 2010 4.0 3.0 2.0 1.0 - Nielsen Kantar GfK Ipsos Synovate 5
Slide 6: Restructuring
RESTRUCTURING – Little or no involuntary loss of top talent – Has improved offer and made easier for clients to buy 6
Slide 7: Kantar Is... Solutions for Every Stop Along the Customer Journey
KANTAR IS... SOLUTIONS FOR EVERY STOP ALONG THE CUSTOMER JOURNEY RETURN ON INVESTMENT OPPORTUNITY ASSESMENT INNOVATION / IDEATION 8 1 2 CUSTOMER EXPERIENCE CONCEPT / PRODUCT TESTING 7 3 TRACKING AND DELIVERY COMMUNICATIONS / TARGETING GO TO MARKET 6 5 4 7
Slide 8: Restructuring
RESTRUCTURING – Little or no involuntary loss of top talent – Has improved offer – Has enabled short and medium term cost cutting – Merged TNS and RI in 25 markets, 3 more to go in 2011/2 – Rebranded 10 businesses – Closed 74 buildings and leases – Merging internet access panels in 15 markets – In m
Slide 9: Key Takeaways
KEY TAKEAWAYS Integration has gone well, has generated savings and has resulted in a better more integrated offer It did make us more internally focused for a period of time and we expect a renewed external focus and a leading edge offer to see us close the revenue gap between us and our competitors
Slide 10: Financials and Structure
FINANCIALS AND STRUCTURE ROBERT BOWTELL
Slide 11: Kantar Structure
KANTAR STRUCTURE BY NETWORK BY REGION 19% 26% 42% 6% 48% 12% 26% 21% TNS Custom MB Media Worldpanel Other UK & Western Europe North America Faster Growing Markets Source: 2010 net revenue excluding associates @2010 constant currency rates 11 Faster Growing Markets are Asia Pacific, Latin America, Mi
Slide 12: Revenue Types
REVENUE TYPES 47% 53% SYNDICATED & SEMI-SYNDICATED AD-HOC 12 Source: Management Information System
Slide 13: Internet and Digital Penetration
INTERNET AND DIGITAL PENETRATION % OF TOTAL REVENUE 30.0% 28.0% 26.0% 24.9% 24.0% 22.2% 22.0% 21.0% 20.0% 18.8% 18.0% 17.7% 16.0% 2006 ** 2007 ** 2008 ** 2009 2010 Source: Management Information System 13 ** Years 2006, 2007 and 2008 are on a combined TNS and Kantar proforma basis
Slide 14: Lower Internet & Digital Penetration Outside NA
LOWER INTERNET & DIGITAL PENETRATION OUTSIDE NA 2010 % OF REPORTED REVENUE 45% 39.5% 40% 35% 30% 25% 19.7% 20% 15% 10% 5% 0% North America Rest of World 14 Source: Management Information System
Slide 15: Faster Growing Markets Share of Revenue
FASTER GROWING MARKETS SHARE OF REVENUE 37.0% 32.0% 30.9% 29.3% 28.0% 27.0% 26.0% 23.7% 24.2% Kantar excluding associates* 22.0% Kantar including associates* 17.0% 2008 2009 2010 Source: Management Information System: * Kantar 2008 based on full year proforma, 2009 and 2010 actuals 15 ** Emerging ma
Slide 16: Kantar Faster Growing Markets 2010 Revenue
KANTAR FASTER GROWING MARKETS 2010 REVENUE Emerging Mature 100% 80% 74.0% 60% 40% 26.0% 20% 8.8% 2.2% 0% % Rev Rev Growth 16 Source: Management Information System
Slide 17: Kantar Leadership Position in Top 10 Markets
KANTAR LEADERSHIP POSITION IN TOP 10 MARKETS MARKET KANTAR POSITION US 2 UK 1 GERMANY 2 FRANCE 1 JAPAN 3 CHINA 1 ITALY 4 SPAIN 1 CANADA 2 BRAZIL 1 Top 10 Markets based on ESOMAR 2010 Report. Kantar Position Includes Associates and has been sourced from 3rd party research providers in individual 17 c
Slide 18: Kantar Leadership Position in BRICs
KANTAR LEADERSHIP POSITION IN BRICS MARKET KANTAR POSITION CHINA 1 BRAZIL 1 INDIA 1 RUSSIA 1 Kantar Position Includes Associates and has been sourced from 3rd party research providers in individual countries, company filings and Kantar management estimates. 18
Slide 19: BRICs Revenues
BRICS REVENUES KANTAR FULL YEAR REVENUE Associates Consolidated 250 250 200 200 Revenue (USD m) 150 150 100 100 50 50 0 2009 2010 2009 2010 2009 2010 2009 2010 0 Greater China Brazil India Russia Source: Management Information System 19
Slide 20: Next 11 Market Share
NEXT 11 MARKET SHARE 50.0% 45.3% 40.0% 37.8% 30.0% 23.1% 21.6% 19.8% 18.8% 20.0% 16.8% 15.9% 12.1% 10.0% 0.0% Source: Management Information System 20 Kantar 2010 based on full year proforma Market share based on ESOMAR study (Sept 2010) with IMF GDP and population growth projections (April 2010)
Slide 21: 2010 Stronger Growth with Top Clients
2010 STRONGER GROWTH WITH TOP CLIENTS % OF REVENUE REVENUE GROWTH 9.0% 8.5% 8.0% 25.2% 7.0% 6.0% 5.0% 3.9% 4.0% 74.8% 3.0% 2.4% 2.0% 1.0% 0.0% Top 20 Clients Rest of Clients Top 20 Clients Rest of clients Total Kantar Source: Management Information System: Top 20 clients based on 2010 full year reve
Slide 22: Consumer Insight PBIT / Revenue Margin
CONSUMER INSIGHT PBIT / REVENUE MARGIN 14% ca 13% 12% 10% 10.6% 9.7% 8% 8.6% 6% 4% 2% 0% 2008 2009 2010 THREE YEAR OBJECTIVE Source: Management Information System 22 * 2008 represents proforma combined Kantar/TNS Margin. (WPP reported 11.3% for Consumer Insight). 2009 & 2010 as reported by WPP.
Slide 23: Margin Target of ca 13%
MARGIN TARGET OF CA 13% – Hold synergy benefits while revenue recovers – Consolidate systems and back office – Better execute at units below margin expectation – Reduce direct costs through improved data collection cost and data efficiency – Increase share of newer and higher margin offers – Increas
Slide 24: Key Takeaways
KEY TAKEAWAYS We are well positioned from a geographical pov, with market leadership in all key emerging markets Our digital revenues are increasing strongly and will continue to do so as markets go online We are committed to improving margins and have got the levers in place to be able to do so 24
Slide 25: Client Offer and Kantar Strategy
CLIENT OFFER AND KANTAR STRATEGY ERIC SALAMA
Slide 26: Client Context
CLIENT CONTEXT – Desire to partner with experts – Move away from projects to insight streams – Focus on usability, real time – Step change in approach, greater senior management focus "Research is not about providing insights, it's about provoking transformation" Stan Sthanunathan, VP, Marketing Str
Slide 27: Kantar Is... Our Clients
KANTAR IS... OUR CLIENTS WA i | COLGATE-PALMOLIVE [a —F atat BRITISH AMERICAN 4 TOBACCO Catia Cs <P & (chowonafohmron kraft foods SYENe Microsoft th NOVARTIS ike eS & P&G eee vodafone —_ Deutsche "= "hl" Telekom DIAGEO @ - MOTOROLA PEPSICO om
Slide 28: Resources Required
EVALUATION STRENTHEN INITIATIVES FOR RESOURCES REQUIRED DEPLOYMENT FUTURE FUTURE FUTURE INNOVATE / SENSE & CO-CREATE RESPOND 28 CONSUMER INTERACTIONS
Slide 29: What Insights?
WHAT INSIGHTS? 29
Slide 30: Compelling Insight Can Reframe the Opportunities and Improve Retail Execution
COMPELLING INSIGHT CAN REFRAME THE OPPORTUNITIES AND IMPROVE RETAIL EXECUTION Consumer Role: • Who’s buying? ILLUSTRATION • Purchase behavior? –Pantry-load vs. cycle compression Traditional Analysis: –Trial vs. trade-up 3500 –Brand vs. category impact • Lift 3000 • Incremental sales (deal week) • Ex
Slide 31: What Insights? How Delivered?
WHAT INSIGHTS? HOW DELIVERED? 31
Slide 32: The True Size of Africa
The True Size of Africa be small contribution in the fight against rampant /mmappancy, by Kal Krause Sources: Brtanrica, Wikipedia, Amanae 2010 Graphic layout for visualization only ( some countries are cut and rotated ) NETHERLANDS But the conclusions are very accurate: refer to table below for exa
Slide 33: What Insights? How Delivered? When Delivered and to Whom?
WHAT INSIGHTS? HOW DELIVERED? WHEN DELIVERED AND TO WHOM? 33
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Slide 35: Kantar's Approach: Collect, Connect, Speed
KANTAR’S APPROACH COLLECT roll out platforms, leverage what you have and collect when you need to CONNECT online and offline, behavior and attitudes, cause and effect SPEED get good insights faster, recognise that some insights are only of value now 35
Slide 36: What Makes Us Different
WHAT MAKES US DIFFERENT – House of brands = deep expertise – Market leadership in BRICS and all key emerging markets – Research, consulting skills = insight into action – Qual, data = ROI, deep insight, scalable – Open source = clients able to join the dots – Focus on creativity, real time = usabili
Slide 37: Key Takeaways
KEY TAKEAWAYS Parts of our strategy are inevitably similar to that of our competitors. But in terms of structure and emphasis on creativity, usability and connecting data we are different in a way that resonates with clients 37