Whither the Insights?

Solving marketing challenges is typically not all that sexy. Inevitably the biggest aha’s come out of long hours spent pouring over lots of documents and information, covering everything from consumer sentiment to sales per square foot, marketplace trends, cultural attitudes, and so on. The quality of the outputs are tied directly to the quality of the inputs. So having a depth of rich data and research is a true strategic advantage for marketers, and their agency partners.

I mention this because I recently learned agency holding company WPP may now be actively considering selling their research and data arm, Kantar. It’s viewed by many as a kind of crown jewel at WPP, with assets that provide rich, insightful information and insight on consumer behaviors, marketing measurement, retail dynamics, clinical research, public policy, consulting…. I don’t have enough ink. And they do this globally.

Why the sale rumor? Because WPP is earning just 15% of revenue and profits from Kantar. From a bean counter’s point of view, that’s underperforming. And if sold, Kantar could raise just shy of $5 billion. OK, that’s some serious cash, and surely WWP would find promising new places to redeploy those funds. So why not sell??? 

Because what a strictly financial point of view won’t reveal is that Kantar’s 15% of profits drive probably 60% of new business growth, and fuels the many brilliant marketing ideas and campaigns that are the very reason clients stay with WPP. To cut loose KANTAR is akin to a hungry farmer eating his seed-corn in the dead of a cold, dark winter. It satisfies the immediate need now, but come spring, there’s hell to pay.

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