30 January 2024 , 12:12
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Advertising titan WPP has announced plans to invest £250 million in artificial intelligence (AI), despite cost-cutting measures elsewhere in the business.
The firm, which is the world's largest advertising and marketing company with around 115,000 employees, believes AI will "enhance, not replace, human creativity". The investment will go towards AI-powered tech and data tools aimed at boosting marketing performance for clients.
WPP counts big names like Meta, Microsoft, Google, Coca-Cola, Dove, and Nike among its clientele. WPP Open, the company's AI platform, already boasts over 28,000 users from a range of major brands including L'Oreal and Nestle.
"AI is transforming our industry and we see it as an opportunity not a threat," said Mark Read, WPP's chief executive. He added: "We are already empowering our people with AI-based tools to augment their skills, produce work more efficiently and improve media performance, all of which will increase the effectiveness of our work."
In addition to this, the group aims to save £125 million by 2025 through restructuring efforts across its owned agencies, with up to half of that amount expected to be saved this year. It also plans to cut costs by about £175 million in its back office and other areas of the business.
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WPP is looking forward to a small rise in sales for 2023, better than last year, with profits at the "top end" of what they thought before. Mr Read said: "While we had to navigate a more challenging environment in 2023, we see strong future demand for our services and are confident we can accelerate our growth over the medium term."
Other big names in the business have warned that the ad world might be slowing down, as customers seem to be more careful with their money for ads.
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