Bangalore

Martin Sorrell, chief executive of WPP who is also called the Sage of Soho, has said that while improvement in internet and digital penetration has made India an important growth market for the company, revenues from the country would remain flat this year due to the sluggish macro-economic environment.

WPP, the world’s largest advertising group by revenue, generates $400 million in revenue from India. Of this, about 60 per cent comes from its advertising business, while the remaining 40 per cent is generated from public relations, digital and healthcare communication. Sorrell said it would be too early to talk about turnarounds in business till 2010.

Globally, the WPP Group is a company with revenues of £7.4 billion and its companies include JWT, Burson-Marsteller and Ogilvy & Mather Worldwide. The group’s digital unit now accounts for a quarter of total group revenues, and Sorrell said it will play an even more key role post recession. Digital advertising is now 12-13 per cent of the total advertising pie.

According to Sorrell, India will be at the forefront of economic growth in the future and the company is looking to capitalise on this. “In India, digital media is becoming very important. Also, the country has more than 400 million mobile phone subscribers and is the home to a large consumer base, making it a strategic market for WPP,” he added.

Recession has emphasised the importance of newer markets, he said. “We are building our growth strategies around markets such as India, China, Argentina and Russia. Also, we expect nations such as Iran, Bangladesh and Pakistan to become significant in few years’ time,” Sorrell said.

WPP will also be continuously looking for acquisitions in India, though the company did not specify any targets. “The company’s base in India has always been very strong and that comes from both acquisitions as well as organic growth. However, at this point, we are mainly focusing on organic growth,”

he said. The advertising company’s result for the first half of the year was severely impacted by recession. Pre-tax profits for the six months to June fell 47 per cent to £179 million ($292 million).