Earlier today we posted the general outlook for IPG; bad. Here are some other key points, more specific to the advertising side, you may be interested in if you work at or compete with an IPG shop (included in the call were Jerry Leshne IPG’s SVP Investor Relations; Michael Roth Chairman/CEO and Frank Mergenthaler, EVP, CFO:
— “As was the case in the second quarter, our performance in Q3 continued to reflect the impact that the global recession has been having on demand for advertising and marketing services. Organic revenue was down 14.2%, about the same level as last quarter.”
— “…marketing and advertising reductions by clients led to a decrease of 18% in the quarter while our organic revenue decrease was 14.2%. To varying degrees these challenges were evident in all disciplines and markets and nearly all client sectors. As Michael indicated, the impact continues to be greatest technology and telecom and the auto sectors.”
— “…we have also begun to see an increase in new business activity, which earlier this year had essentially ground to a halt in many world markets. While this isn’t a definitive indicator of an advertising recovery, it certainly is an encouraging sign. We are equally pleased that a review of all major industry pitches over the past year shows that not only are we being included in every significant opportunity out there in which we are not blocked due to client conflict, we are also winning in a broad cross section of our agencies.”
— “Another potential driver of an advertising recovery could be the automotive sector, which we have called out as a contributing factor in our organic revenue decreases the past few quarters. Now, as the auto industry emerges from what has been a very troubled period, it could represent significant upside for providers of marketing services with both existing and new clients. The Volkswagen win at Deutsch is a recent example as is the opportunity to win Cadillac and GM and Media Brand’s involvement in the global Hyundai media review. There will likely be increased spend if the category next year as well, which we see as a real opportunity.”
What do we take away from this? IPG is really excited about VW and the
credibility money such a famous brand will being to the company.