Martin Sorrell: 'COVID-19 is a burning platform'

Chris Pash
By Chris Pash | 18 November 2020
Sir Martin Sorrell via Zoom
Originally published in the AdNews September/October magazine. Subscribe here to make sure you get your copy.
An Interview with Sir Martin Sorrell

S4 Capital, the pure-play digital advertising group started by Sorrell, the founder of WPP, is in a sweet spot in the market, serving the tech, health care, online shopping, in-home entertainment and gaming sectors, all doing well during the pandemic.

“COVID-19 is a burning platform and has accelerated the speed of digital transformation and disruption,” Sir Martin told AdNews.


"From our point of view, and without making light of it, I have to say the lockdown is pretty productive. Obviously from an inter-personal point of view, it makes life difficult but it hasn’t prevented us from pitching effectively for business. Although we prefer land and expand, as we call it, rather than set pitches, it hasn’t prevented us from doing deals."


"One of the things that COVID has taught us is that we can work from home effectively. That we can work with more varied working hours, with commuting being much more variable. In London at the moment, most of our people don’t want to travel on public transport. There’s a premium, a congestion charge on private transport, which has gone up from £10 to £15. So everyday you travel in (to London by private car) it costs you £15. That’s to stimulate biking and walking and public transport, but nobody wants to go on public transport."


(In January, S4 recorded organic growth of 33%, in February 21%, March 6%, April 3%, May 5%. Since this was published in the AdNews magazine, S4 has blasted through the pandemic. In the September quarter, like-for-like revenue was up 13% to £86.39 million.) 

"Famous last words, but I think we bottomed in April. We haven’t given the market for June, but I can tell you that it was double digits. And then I can also say to you that July looks as though it was stronger than June.

"Anyway, I think the shape of this is like a reverse square root. I know that’s a bit convoluted, but it indicates a fall and a recovery, but not a recovery quite to the level that we saw before. I think the game for us, if I can put it that way, is to pick out the sectors that are V-shaped (tech, healthcare, online shopping, in-home entertainment)."


"Basically, more flexible working hours, less offices. That gives us more money to invest in people, which is, I think pretty key. We spend about £250 million a year on people and about £30 million in properties. And I’d far rather take some of that £30 million, invest in people and build the business and create more jobs, at a time when jobs are needed. Rather than invest it in offices and have landlords gear up our rents every three or five years."


"If the holding companies are dropping 50,000 people globally, which is what the trade magazines say, and if they’re dropping 50,000 jobs in independent agencies and holding companies in the United States alone, that gives us an opportunity to hire some really good talent. We do a daily call of our top eight people every day at 2 o’clock London time. We were talking about how we are starting to hire some really, really good talent. Creative talent in particular, dissatisfied with the status quo, from places that hitherto you would never think you would be able to winkle people out. Not traditional agencies, but let me say agencies which have very strong digital reputations. I think, as a result of COVID, we are going to see a lot of shifts of people. They are very worried about their jobs but the really good people are on the move and I think we can pick off some good talent. That’s become increasingly obvious."

Procurement and diversity

"I think people are going to be surprised how significant the changes will be. We are obviously seeing a fair amount of movement because of Black Lives Matter. I think one thing that I’ve noticed clients putting a lot of focus on recruitment now, and a lot of focus on their procurement policy reflecting social or purpose objectives. The scorecard for client reviews is dominated — and I don’t think this is too extreme a statement — by the need for diversity of the team. If you show up with an all white male team, you’re dead. It’s not just America ... it’s international and of course the global companies will be rolling out these criteria for procurement. We have a minority fellowship scheme which will be up and running, I hope, in Q4 of this year. We will go to black high schools in America and to black universities to recruit. It will be a small scale thing, similar to the fellowship I did in WPP, but this will be restricted to black recruits from high schools, not just universities. Because the proportion of the black community that gets educated at universities in America is still disproportionately low.

"As an organisation we are very diverse anyway. We’re about 40% people of colour, but the proportion of people who are black is on the lower side. It’s about 3% or 4% in the US and the average I think for the country is around 13%. But in California it’s 4% or 5%, but in New York it’s 24%. We’ve said that we will reflect our local communities. It means that, for example, in New York, we would aim to have that proportion at 25%. We work in 30 countries to date. We are diverse, and I think inclusive from a gender point of view and a race and an ethnic point of view. We have very strong Hispanic representation, we have very strong Asian representation, we have very strong people of colour representation. But the black proportion has to be increased."

The future of S4 Capital

"We’re only in the foothills and we have a lot of work to do, but it’s been a great start and I have to say, coming back to your question about people, we have superb people. I’ve been in the industry for a long time but I’ve never seen better people. Superb. It’s a great team."

Test by fire

"COVID-19 has had terrible, terrible consequences, the mayhem it’s caused. But on the other hand, there have been some good things that have come out of it. They talk about people being tested under fire, or the strongest steel in the hottest furnace. I think that’s true about COVID. I think at the very beginning, those last two weeks in March, were not pleasant as people tried to adjust. But our people have been magnificent. They are digital natives, so working from home is not a problem. It’s first nature, not even second nature to them. So they’re superb people. I know that if MediaMonks or MightyHive (S4 Capital businesses) pitched for a piece of business in our content side or our data analytics or programmatic side, they will win. Our pitch win ratio is huge. I would say 75%, three out of four. It’s very, very strong."

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