International: The founder of the fastest-growing company S4 Capital, Sir Martin Sorrell, contemplates that the industry may have hit its lowest point during COVID-19 by adding that June quarter was a bloodbath for many clients.
In his interaction with AdNews he said, “Less so, tech, less so health care, less so, obviously, online shopping, less so in-home entertainment and gaming,”
“Tech is about 53% of our business and if you threw healthcare in you’d get close to 60%.
“Two thirds of our business are in tech and healthcare which is the sweet spot, even during COVID-19.”
In January, S4 recorded organic growth of 33%, in February 21%, March 6% and April 3%.
“We haven’t given the market June, but I can tell you that it was double digits,” he says. “And then I can also say to you that July looks as though it was stronger than June. I would say we’re in a digital sweet spot or growth hot spot around first-party data, digital advertising content and programmatic with data and analytics sewn in.” He added.
Sorrell added that the second quarter marked the bottom of the ad market, the third quarter will be relatively better and the December quarter better than that.
“Then as you get into 2021, I think it gets better and I think the crucial thing clearly is when we will be vaccinated,” he says.
This looks like happening in the second or third quarter next year.
Sorrell sees the recovery uneven, better in some sectors than others.
“I would still stick with where I was a few months ago, which is, there are some areas that are V-shaped like technology and healthcare, in-home entertainment and gaming, online shopping,” he says.
“But there are areas that are U-shaped like the packaged goods companies, although Proctor had a remarkably strong first six months of this year. They’ve done extremely well.”
Sorrell indicated that lockdown was productive on a personal level and added “it can make life difficult but lockdown didn’t prevent S4 from pitching effectively for business.”
“It hasn’t prevented us from doing deals,” he says.
Sorrell also said that S4 has a new acquisition coming later in August, an econometric media optimisation area in the UK “we are pretty excited about”.
S4 Capital recently raised GBP 113 million as a war chest for acquisitions.