WPP WPP PLC

By Nick Kostov 

WPP PLC named Mark Read as chief executive Monday, tapping a company veteran in a push for continuity at the world's largest ad firm following the departure of founder Martin Sorrell.

In an interview, Mr. Read said he doesn't plan to merge or sell any of WPP's marquee creative agencies, like Young & Rubicam and J. Walter Thompson, focusing instead on how to make them work more closely with the company's stable of digital advertising and data science firms.

That strategy spells relief for company insiders who once worried Mr. Sorrell's resignation in April would lead to the dismantling of WPP's sprawling empire. Mr. Read, however, now faces the challenge of yoking together disparate businesses as WPP scrambles to cope with disruption that Facebook Inc., Alphabet Inc.'s Google and other tech companies are causing across the ad industry.

"We need to move quickly and decisively, but this isn't a case of throwing the baby out with the bathwater," Mr. Read said.

Mr. Sorrell, 73, built WPP into a globe-spanning colossus over three decades of acquisitions, but the scale that once allowed the company to thrive has lately made it a sluggish competitor. WPP is under pressure from investors and big clients -- such as Ford Motor Co., and Unilever PLC -- to make the process of buying, creating and measuring the effectiveness of ads more simple and transparent. That is difficult for a holding company like WPP that has based its business model on pitting agencies against each other to win clients.

"There's no doubt our industry is going through a period of structural change, but it's not a period of structural decline," Mr. Read said.

Mr. Read, 51, also is under pressure to turn the page on WPP's public duel with its founder. After resigning, Mr. Sorrell launched a rival ad holding company that recently outbid WPP to acquire MediaMonks, a Dutch digital production house. He has also continued to publicly needle WPP over its strategy and personnel moves.

On Monday, Mr. Sorrell said he had congratulated Mr. Read while reiterating that he would have preferred to see the WPP promote Andrew Scott along with Mr. Read to serve as co-chief executives. Instead, WPP named 49 year-old Mr. Scott as chief operating officer on a permanent basis, a position he had temporarily held with Mr. Read during WPP's CEO search.

"Andrew is a very strong, capable executive," Mr. Sorrell wrote to the Journal in a text.

WPP signaled that it aims to keep CEO pay in check after facing investor criticism for handing Mr. Sorrell some of the industry's largest payouts -- GBP70.4 million in 2015 and GBP48.1 million in 2016 -- due in part to a generous, long-term incentive stock awards, which made up most of his compensation.

Mr. Read will receive a fixed salary of GBP975,000 ($1.3 million), slightly less than Mr. Sorrell's salary of $1.48 million last year. Mr. Read's maximum bonus and long-term incentive share awards have been capped at six times his base salary. His long-term incentive scheme depends on WPP's performance and share price after five years.

Mr. Read's co-workers describe him as a study in contrasts with Mr. Sorrell, a well-known micromanager who was long considered an oracle for his willingness to make pronouncements on the direction of the world economy.

Mr. Read, co-workers say, is soft-spoken introvert who gives his staff autonomy, often telling them to "just get on with it."

"People underestimate Mark because he's not loud and brash," said Shane Atchison, Chief Marketing Officer of data-analytics company Domo Inc. and a former WPP executive. "He simplifies things rather than making them more complex."

Mr. Read shot to prominence in April when he was named co-chief operating officer of WPP, taking over the firm's day-to-day operations after Mr. Sorrell resigned. He has since been reviewing WPP's businesses, asking executives what works and what doesn't.

Colleagues say Mr. Read is exacting. A wine connoisseur, Mr. Read is known for bringing his own bottle to social events in case the wine being served isn't up to scratch, they say.

In the interview, Mr. Read said he already has begun simplifying WPP by selling stakes in ad-tech firm AppNexus and marketing software developer Globant. He said WPP's portfolio of more than 400 companies now "need to come closer together, not further apart. It's paring down not breaking up."

"I'm keener to build stronger creative agencies with digital capabilities than I am to think about merging creative agencies in a cost consolidation play," Mr. Read said.

WPP executives say they are eager to see a shift in power away from the head office in London. Some felt decisions were delayed by a need to go through Mr. Sorrell for what they considered relatively trivial requests.

Mr. Read was born in London. His father was an entrepreneur and his mother an orthodontist.

In 1989, he joined WPP straight out of college after writing to Mr. Sorrell to ask for a job. He later worked at consulting firm Booz Allen & Hamilton before founding WebRewards, a startup specializing in online loyalty programs that was sold to Bertelsmann in 2001.

After working on WPP's digital development for more than a decade, he was named CEO of Wunderman in 2015, one of WPP's largest agencies. There he consolidated Wunderman offices that were scattered across the globe. He also broadened Wunderman's business, which was focused on direct marketing, to include consulting, business transformation and e-commerce, changing the agency's pay structure to incentivize different parts of Wunderman to work together.

Mr. Read "quickly unified us with a vision, a purpose and a culture," said Mel Edwards who runs the agency's Europe operations.

Stephan Pretorius, chief technology officer at Wunderman, said Mr. Read fosters loyalty by empowering his staff.

Shortly after WPP bought Mr. Pretorius's company, Mr. Pretorius said, Mr. Read asked him to present to the board of a large media company on the future of digital publishing. Mr. Pretorius protested that he had never presented at that level, but Mr. Read told him to go ahead.

"He pushes people to achieve more than they think they can achieve," Mr. Pretorius said.

Write to Nick Kostov at Nick.Kostov@wsj.com

(END) Dow Jones Newswires

September 03, 2018 12:17 ET (16:17 GMT)

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