WPP : Presentation

ACCELERATING GROWTH

CAPITAL MARKETS DAY

17 December 2020

WPP 1

CAUTIONARY STATEMENT REGARDING

FORWARD-LOOKING STATEMENTS

This presentation contains statements that are, or may be deemed to be, "forward-looking statements". Forward-looking statements give the Group's current expectations or forecasts of future events. An investor can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as 'anticipate', 'estimate', 'expect', 'intend', 'will', 'project', 'plan', 'believe', 'target' and other words and terms of similar meaning in connection with any discussion of future operating or financial performance.

Other than in accordance with its legal or regulatory obligations (including under the Market Abuse Regulations, UK Listing Rules and the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority), the Group undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Investors should, however, consult any additional disclosures that the Group may make in any documents which it publishes and/or files with the US Securities and Exchange Commission (SEC). All investors, wherever located, should take note of these disclosures. Accordingly, no assurance can be given that any particular expectation will be met and investors are cautioned not to place undue reliance on the forward-looking statements. Forward-looking statements are subject to assumptions, inherent risks and uncertainties, many of which relate to factors that are beyond the Group's control or precise estimate. The Group cautions investors that a number of important factors, including those in this presentation, could cause actual results to differ materially from those expressed or implied in any forward-looking statement. Such factors include, but are not limited to, those discussed under Item 3.D 'Risk factors' in the Group's Annual Report on Form 20-F for FY 2019 and any impacts of the COVID-19 pandemic. Any forward-looking statements made by or on behalf of the Group speak only as of the date they are made and are based upon the knowledge and information available to the Directors on the date of this presentation.

Nothing in this presentation should be construed as either an offer to sell or a solicitation of an offer to buy or sell WPP securities in any jurisdiction, or be treated or relied upon as a recommendation or advice by WPP.

The views expressed in this presentation contain information that has been derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. This presentation should not be relied upon as a recommendation or forecast by WPP.

2

WPP IS A

CREATIVE TRANSFORMATION COMPANY

WPP 3

WE SERVE MANY OF THE WORLD'S

MOST SUCCESSFUL COMPANIES

WPP'S TOP 20 CLIENTS

CPG/PREMIUM		TECHNOLOGY/MEDIA	PHARMA AND HEALTHCARE		AUTOMOTIVE

WPP 4

WE HAVE MANY OF OUR INDUSTRY'S MOST POWERFUL

AND RESPECTED BRANDS

			PR & PUBLIC	SPECIALIST
GLOBAL INTEGRATED AGENCIES		AFFAIRS	COMMUNICATIONS
	CREATIVE AGENCIES	MEDIA AGENCIES

WPP 5

GLOBAL REACH AND SCALE IN GROWTH MARKETS

NORTH AMERICA 37%1

WESTERN EUROPE 33%1

REST OF WORLD 30%1

10,000

7,000

19,000	2,000

2,000

6,500

2,000

4,000	8,000

1. % FY19 Revenue less pass-through costs Figures in chart are headcount at Q3 20

WPP 6

SIGNIFICANT STRENGTHS IN A TECHNOLOGY-DRIVEN WORLD

c.$30B

Annual GMV over WPP-installed

commerce platforms

c.40%

of media billings

are digital

Working on

ecommerce with

76 TOP 100 OFOUT

clients

25%

Of net sales attributable to clients in TMT sector2

1.6B		>20k
Audience pool updated		Accreditations
for planning and		in 2020 across
activation daily		technology partners1

$10B
	Top 3
Client billings across Google,		Global partner to Adobe and
Amazon and Facebook		Salesforce in marketing tech

1. H1 20 figure

2. YTD Sep-20

WPP

7

OUR PURPOSE IS TO USE THE POWER OF CREATIVITY

TO BUILD A BETTER FUTURE FOR OUR…

PEOPLE PLANET CLIENTS COMMUNITIES

WPP 8

ACCELERATING GROWTH

PROGRESS SINCE DECEMBER 2018

ACCELERATING OUR GROWTH

• THE MARKET
• WPP'S STRATEGY
• BUILDING OUR CULTURE
• FINANCIAL PLAN

Q&A

PROGRESS SINCE DECEMBER 2018

2018: THE SITUATION

SLOWING GROWTH

• Negative growth for 4 quarters
• No growth in USA since Q4 2016
• 5 or 6 out of 6 peers in relative growth

CLIENT ISSUES

• Largest client under review
• $4 billion of client business being pitched

ORGANISATIONAL	•	No common WPP vision, culture or purpose
COMPLEXITY	•	9 separate creative or digital networks
	•	At least 500 brands

UNSUSTAINABLE FINANCIAL MODEL

• Lack of capital allocation discipline
• Dividend close to 60% of earnings
• Debt approaching £5 billion

WPP 11

WHILE MEDIA AND DIGITAL PERFORMED WELL, OUR CREATIVE AGENCIES STRUGGLED

RELATIVE GROWTH OF MAJOR AGENCIES

(CONSTANT CURRENCY NET SALES GROWTH, INCLUDING M&A)

25%

20%

15%

10%

5%

0%

5 yr CAGR to 2014

5 yr CAGR to 2019

22.9%

12.0%

6.8%	7.5%	7.5%
	5.9%
3.0%	3.8%	3.0%
	1.0%

-1.5%

MEDIA

GroupM

DIGITAL

VML Wunderman

CREATIVE

JWT

Ogilvy

Y&R

Grey

-5%

-3.5%

-2.4%

-4.9%

-10%

BASIS OF PREP: All agencies exclude GTB and the effect of material intra-group transfers. Ogilvy excludes Geometry. All agencies include Hogarth.

WPP

12

GROUPM HAS DELIVERED BOTH GROWTH AND MARGIN

GROUPM MARGIN VS DIGITAL SHARE OF MEDIA MARKET

OPERATING MARGIN

								60%
						40%		52%		MARKET
						46%	50%
					35%			40%	MEDIA
				31%						OF
			26%					30%
17%							20%	SHARE
	22%
	20%
								10%	DIGITAL
									0%
2011	2012	2013	2014	2015	2016	2017	2018	2019

Share of digital in advertising market		Group M operating margin

BASIS OF PREP: Headline OP GroupM excludes GTB, includes Hogarth
SOURCE: GroupM 'This Year Next Year' report total advertising spend exc. political advertising in US	WPP	13

IN DECEMBER 2018, WE SET OUT

FIVE STRATEGIC OBJECTIVES

VISION AND	CREATIVITY	DATA AND
VISIONOFFERAND	TECHNOLOGYDATA AND
CREATIVITY
OFFER	TECHNOLOGY

SIMPLER	PEOPLE AND
SIMPLER
STRSTRUCTURET RE	CULTURE
CULTURE

WPP 14

WE EXPANDED OUR OFFER INTO FASTER-GROWTH AREAS

COMMUNICATIONS EXPERIENCE

COMMERCE TECHNOLOGY

GLOBAL MARKETING EXPENDITURE 2019

$1,000
		$873B								Addressable
$900
										Not currently addressable
$800	168
$700
$600					$508B
$500							54
$400
705					$250+B
$300
											25
$200	454								$151B
$100							~200+		63
$-											88
Communications Experience	Commerce		Technology

NOTES:

• Source for addressable spend all IDC, apart from Communications (GroupM/WPP)
• Sources for non-addressable spend: Communications - GroupM; Experience - IDC CX Spending Guide 2019; Commerce - estimate based on Experience ratios; Technology - WARC/BDO "Martech 2020 and beyond" (October 2019)

WPP 15

WE RENEWED OUR COMMITMENT TO CREATIVITY

Laura Jordan Bombach

Marcos Kotlhar

Taras Wayner

Keith Cartwright

Debbie Vandeven

Walter Geer

Noel Cottrell

Danilo Boer

Justine Armour

Holding Company of the Decade

Pencils won by eight creative agencies

Most Effective Holding Company 2012-2020

No.1 Media Holding Company 3 years running

89 awards in 2019; top honours to Ogilvy and

AKQA

BCW no.1 in 2020 Global Creative Index

WPP 16

WE HAVE RADICALLY SIMPLIFIED OUR STRUCTURE

FROM			TO
25 networks			10 networks
65+ speciality businesses		<40 speciality businesses
500+ brands			220 brands
10,000 people in campuses		38,000 people working from
			20 campuses
	ACTIONS
100+ local office >£3.5bn raised from	80+ business unit
mergers	60+ disposals	closures

WPP 17

OUR CLIENT SATISFACTION HAS

SYSTEMATICALLY IMPROVED

WPP CLIENT SATISFACTION

8.2	8.1

8

7.8

7.8	7.7	7.7

7.6

7.4

7.47.3

7.2

7

6.8

2018 H1

2018 H2

2019 H1

2019 H2

2020 H1

COVID (April-Aug)

SOURCE: WPP Vantage; 2.4K-59K+ client responses per period; scores out of 10

WPP

18

WE HAVE WON AND RETAINED MAJOR CLIENTS

					Global / Oct 2020
RANK		HOLDING
OCTOBER		GROUP						REVENUE	NO. OF WINS
1		WPP						3%	1,590
2		Publicis Groupe						2%	659
3		Omnicom							778
4		Dentsu							898
5		Interpublic							442

WPP 19

TOGETHER, IMPROVED OUR RELATIVE PERFORMANCE

WPP VS. AVG ORGANIC GROWTH - USA

WPP vs. AVG ORGANIC GROWTH - GLOBAL

% BY QUARTER, 2016-2020
4%
	1.9%	2.1%														2.1%
2%																	1.7%
0.8%
0%
-2%			-1.3%-1.2%		-1.8%
					-2.2%
														-2.5%
-4%								-3.3%					-4.0%
									-4.3%						-4.1%
-6%						-5.4%
									-6.2%		-6.1%
-8%											-7.3%
-10%
												-10.0%
-12%								1Q18								1Q20
1Q16	2Q16	3Q16	4Q16	1Q17	2Q17	3Q17	4Q17	2Q18	3Q18	4Q18	1Q19	2Q19	3Q19	4Q19	2Q20	3Q20
2016		2017			2018			2019			2020

BASIS OF PREP: USA includes Dentsu 'Americas'. Dentsu does not disclose USA alone prior to Q3 2019.

SOURCE: Company reports

% BY QUARTER, 2016-2020
4%
2%																		1.0%	1.4%
			0.3%											0.3%
0%
		-0.1%
	-1.0%		-0.7%					-0.6%
-2%			-1.0%										-1.1%-1.5%
					-1.3%-1.3%	-1.4%
								-2.2%					-2.3%
-4%												-3.1%
										-3.8%	-3.7%
-6%
-8%
-10%
-12%	1Q16	2Q16	3Q16	4Q16	1Q17	2Q17	3Q17	4Q17	1Q18	2Q18	3Q18	4Q18	1Q19	2Q19	3Q19	4Q19	1Q20	2Q20	3Q20
																			WPP	20

WE ENTER 2021 HAVING MADE SIGNIFICANT PROGRESS - MUCH OF IT DURING COVID

• Improved organic growth performance

1. Growth ex-Chinapre-COVID

1. Above peer group in last two quarters

• 1. 3 out of 6 with the ambition to go further
• Stronger client performance
• 1. 15 of top 30 clients grew in Q3

• 1. Business at risk at low levels throughout 2020
  1. Industry-leadingnew business performance
• Improved financial position
• 1. Net debt down to £2.3 billion at Q3
• Taken action during COVID to be ready for 2021
• 1. Continued to attract top talent

1. Responded rapidly on cost

1. Positioned WPP for the future: AKQA Group, VMLY&R Commerce, Finsbury Glover Hering

WPP 21

ACCELERATING OUR GROWTH:

THE MARKET

COVID IS ACCELERATING EXISTING TRENDS

1	2	3	4	5
Growing	Technology	Collision of	CMOs are becoming	Marketing value
importance of	reshaping old	communications,	Chief Growth	chain is evolving
purpose and	consumer models -	content and	Officers requiring	with disruptive
reputation	mass media, bricks &	commerce,	new skills and	entrants and
	mortar - with new	powered by data	support	operating models
	expectations of	and technology
	personalisation &
	immediacy

WPP 23

CONSUMERS EXPECT MORE FROM

COMPANIES

2.5X		85%		62%		90%
BRAND VALUE		BELIEVE		PREFER		BELIEVE
for brands perceived		brands should be about		to buy		companies have an
as having a high positive		something more than		from sustainable		environmental and social
impact on society1		profit2		brands3		responsibility4	Gen Z
		Gen Z		Gen Z

1. Kantar Purpose 2020 Report
2. Generation Z: Building a Better Normal, Wunderman Thompson Intelligence, Dec-20
3. The State of Consumer Spending: Gen Z Shoppers Demand Sustainable Retail, Jan-20

4. Bank of America Gen Z Primer

WPP 24

DIGITAL IS NOW THE DOMINANT MEDIUM

MEDIA SPEND BY MEDIUM ($M)

300,000

250,000

200,000

150,000

100,000

50,000

-

US

CHINA

UK

BRAZIL

INDIA

63%

DIGITAL

90%

DIGITAL

72%

DIGITAL

53%37%

DIGITALDIGITAL

2012

2020

2024

2012

2020

2024

2012

2020

2024

2012

2020

2024

2012

2020

2024

Digital TV Other

SOURCE: GroupM, The Advertising Association/WARC, IAB, Company Reports.

WPP

25

ECOMMERCE HAS ACCELERATED DRAMATICALLY

ECOMMERCE AS % OF RETAIL SALES

35%

31%

30%

27%

25%

						20%
20%			18%
	15%	16%						16%
15%								14%
			11%	12%
		10%
10%	9%
5%
2017	2018	2019		Q1 20	Q2 20	Q3 20
					UK		US
										PAGE 26

SOURCE: US Consensus (Nov-20) and ONS Internet retail sales (UK). Q3 20 represents preliminary estimates.

WPP

26

STREAMING SERVICES AND SOCIAL

VIDEO ARE EXPLODING

GLOBAL		SUBSCRIBERS		HOURS OF VIDEO WATCHED
SVOD SUBS1		TO DISNEY+		ON YOUTUBE DAILY
1.2BN		>230M		1BN
By 2025		By 2024

TIKTOK		UNIQUE CREATORS		MONTHLY AD-SUPPORTED
APP DOWNLOADS		STREAMING ON TWITCH		VIEWERS ON HULU
>2BN		6M+		>92M
Worldwide		Monthly

1. Digital TV Research

WPP 27

CLIENT SPEND IS HOLDING UP - BUT IT IS SHIFTING

1. What percentage of your company's total revenue is allocated to its total marketing expense budget?

14

			12.1%
		11.4%
12		11.3%
			11.2%	11.0%

10.2%	10.5%
10

8

6

4

2

0

2014

2015

2016

2017

2018

2019

2020

68%

of CMOs expecting martech budget increase

Spend on marketing technology

now exceeding

traditional agency fees

Digital will be 61%

of global ad spend in 2021

TV will be 18%

of UK ad spend in 2021

SOURCE: 2020 Gartner CMO Spend Survey
n = 328 (2020); 342 (2019) N.America/U.K. Respondents; 618 (2018); 350 (2017); 375 (2016); 424 (2015); 363 (2014)	WPP	28

OUR GROWTH OPPORTUNITY IS IN DIGITAL COMMUNICATIONS AND IN EXPERIENCE, COMMERCE AND TECHNOLOGY

	$400
	$350
	$300	$281B
$BN	$250	52
SPEND		21

$200

45

$150

$100

163

$50

$0

2017

Communications

SOURCE: All IDC, apart from Communications (GroupM/WPP)

			CAGR
			(21-24F)
		$368B	5.6%
$310B		84	9.8%
63		33	9.8%
25
54		75	10.9%
168		175	1.3%
~48% digital	~59% digital
2019		2024F
Experience	Commerce	Technology
			WPP	29

COFFEE BREAK

EXTRAORDINARY AWARDS 5 MINS

WPP30

ACCELERATING OUR GROWTH:

WPP'S STRATEGY

WPP'S GROWTH STRATEGY

ACCELERATING OUR GROWTH

COMPANIES	CLIENTS	COUNTRIES
Strong, growing	Partner to the world's	Scale in the markets
brands	leading companies	of the future

SCALED		CULTURE		GROUP-WIDE
CAPABILITIES			TRANSFORMATION
To deliver scale in		To be the		To provide an efficient and
production, data and		employer of choice		effective platform to fund
technology		for all		investment

CAPITAL ALLOCATION: To provide sustainable returns to our shareholders

WPP 32

COMPANIES: OUR GROWTH PLATFORMS

12%

Specialist

Comms

8%

PR

CREATIVE

45% MEDIA

Creative

GROWTH PLATFORMS

• Digital communications
• Healthcare
• Ecommerce and experience
• Marketing technology
• Production
• Digital media: Search, social and programmatic
• New business models: Xaxis and Finecast

35%

Media

80%

Global Integrated

Agencies1

INTEGRATED			• Data and technology
AGENCIES	PUBLIC RELATIONS	• Purpose and reputation
			• Sustainability
			• Digital and social media
	SPECIALIST COMMS	• Brand experience and identity
			• Specialist services

1. Includes AKQA and Geometry, previously in Specialist Comms

WPP 33

VMLY&R DEMONSTRATES BENEFITS OF INTEGRATION

VMLY&R QUARTERLY LFL NET SALES GROWTH

20.0%

15.0%

10.0%

5.0%

0.0%

-5.0%

-10.0%

-15.0%

VML Y&R VMLY&R

BASIS OF PREP: All agencies excluding GTB and Hogarth.

WPP

34

CREATIVE AGENCIES: EXCELLENCE IN

DIGITAL COMMUNICATIONS

Boots.com page views	Social impressions	Return on ad spend
+95% YoY	+687% YoY	223%over benchmark

WPP 35

CREATIVE AGENCIES: EXPANSION INTO

ECOMMERCE

	New category entrants	One of the world's largest	commerce sites
	roll-outs of Adobe's B2C
across three global brands	10launched so far
	commerce platform

/ Germany		/ United Kingdom		/ Italy

/ Columbia

/ United Kingdom

/ Poland

WPP 36

CREATIVE AGENCIES: BUILDING NEW EXPERIENCES

1ST ONLINE RESERVATION PLATFORM

500K VISITORS IN FIRST 24 HOURS AFTER LAUNCH

23 MILLION CUSTOMERS HAVE VISITED BRONCO PAGES

45 MINS BRONCO SOLD OUT

8 DAYS FIRST EDITION MACH-E SOLD OUT

95% OF ALL MACH-E RESERVATIONS MADE ONLINE

IN MEDIA, WE CAN BUILD ON SIGNIFICANT MOMENTUM

2020 KEY MEDIA NEW BUSINESS WINS

SOURCE: COMvergence, Q1-Q3 2020

WPP

38

XAXIS CONTINUES TO GROW AND INNOVATE

CHALLENGE FROM VOLVO

• More customers and lower cost per conversion through relevant and tailored digital communications

APPROACH

• Combined WPP team across Xaxis, Mindshare and Grey

• First-party Google analytics data to define Volvo's target audience

• Leveraging machine learning to address relevant users at scale

• Dynamic Creative Optimization (DCO) testing of campaign elements to identify best creative combination

• Through AI, Volvo's creative messaging continually transformed based in real-time learnings to build 2,358 ads, each tailored to the end user

OUTCOME

66% 440%

Decrease in Cost per	Increase in
Conversion	Conversion Rate

AND CONNECTED TV REPRESENTS A SIMILAR OPPORTUNITY

DEEP UK CONNECTIVITY ACROSS BROADCASTERS AND PLATFORMS

50%		ALSO LIVE TODAY
Monthly reach (UK households)		Australia	Germany
		Canada	Indonesia
		USA

+40,000,000		NEW MARKETS BY END OF 2021
TV devices		Netherlands	Italy
		India	Taiwan
		Thailand

WPP 40

IN PUBLIC RELATIONS, WE HELP TO MAXIMISE THE

EFFECTIVENESS OF OUR CLIENTS' CAMPAIGNS

99.99%

Of households counted

Increase in Conversi n Rate

WPP 41

CLIENTS: EXPANDING OUR OFFER

EXPERIENCE	Brand Expression		Innovation
& Sonic Branding

COMMERCE Dedicated

Amazon team

TECHNOLOGY	Single Customer
View
		CRM Platform Build

AND GROWING WITH THE CLIENT

NEW		ACQUISITIONS		EXPANSIONS
PRODUCTS

42

COUNTRIES: CAPTURE THE OPPORTUNITY IN HIGHER GROWTH MARKETS

BRAZIL

CHINA

INDIA

WPP 43

SCALED GLOBAL	DATA-DRIVEN
PARTNERSHIPS	PRODUCTION

OUR GROWTH IS SUPPORTED

BY A COMMON APPROACH TO

PRODUCTION, TECHNOLOGY

AND DATA

OPENDEEP

APPROACHSPECIALISATION

WPP 44

DATA AND TECHNOLOGY-DRIVEN PRODUCTION: HOGARTH

TECHNOLOGY: SCALED GLOBAL PARTNERSHIPS

MARKETING TECHNOLOGY

DIGITAL MEDIA+

CLOUD & AI

CREATIVE & PRODUCTION

$400M SERVICE	3,200+ EXPERTS	170+ CLIENTS
REVENUE	ASSIGNMENTS

WPP 46

TECHNOLOGY: DEEP SPECIALISATION

DIGITAL AGENCIES

CX

ADOBE

Gartner Magic Quadrant for	IDC Worldwide CX	Forrester Adobe
Global Digital Agencies, Feb 2020	Improvement Services, 2020	Implementation Services
- 4/10 Leaders	- WPP/AKQA clear leader	Wave Leaders, Q2 2020

WPP 47

OPEN DATA APPROACH: DELIVERING MASS PERSONALISATION

• Integrated WPP team across creative, media, data, technology and public relations
• WBA-ownedidentity graph to activate
  WBA's first party data in all channels
• Third party platforms, fully integrated with partners

WPP 48

ACCELERATING OUR GROWTH:

BUILDING THE CULTURE

BUILDING CULTURE THROUGH PURPOSE

Using the power of creativity to build better futures

PEOPLE	PLANET	CLIENTS	COMMUNITIES

Attract, retain	Accelerate the transition	Deliver extraordinary	Drive change in the
and develop our	to a sustainable world	work through the	world around us
people in a
	best people and a
culture that is
open, optimistic		unifying purpose
and extraordinary

WPP 50

THE SITUATION TODAY

SIGNIFICANT AREAS OF STRENGTH…

• 100k+ employees - highly skilled and motivated
• Strong response to COVID from our people who demonstrated resilience and commitment - supported by a broad and deep wellbeing programme
• Progress on collaboration including cross- agency client wins
• Excellent gender balance at junior/manager level - more than 50% women

…BUT OPPORTUNITIES FOR IMPROVEMENT

• Much more work to do on racial diversity overall. Still working towards 50-50 gender split at leadership levels
• Approx. 60-65% of hires come from outside WPP = need to improve career opportunities for our people
• Lowering employee churn
• Multiple systems with poor integration

WPP 51

OUR PEOPLE ARE OUR COMPANY

Attraction

Retention

The Best Talent Delivering

for our Clients

Growth

WPP 52

OUR PEOPLE STRATEGY

CREATIVE TRANSFORMATION

1	2	3
EMPLOYER OF	MODERNISATION	GROWTH
CHOICE FOR ALL	OF EXPERIENCES

TECHNOLOGY & DATA & INSIGHTS

WPP 53

DIVERSITY AND DIFFERENCE DRIVES CREATIVITY

Diverse companies are more likely to financially outperform their peers by at least 25%

	36%
25%
Gender Diversity	Ethnic Diversity

Companies with more diverse leadership teams report 19 percent points higher innovation revenue

26%

average

innovation

revenue

Companies with below-average diversity scores

45%

average

innovation

revenue

A diverse workforce is better at developing innovative products and services

Diversity policies won't lead to

overnight improvements in innovation, but a diverse company will see about two new additional product announcements over 10 years

Companies with above-average diversity scores

Source: McKinsey Diversity Wins Report

BCG Diversity and Innovation Survey 2017

North Carolina State University Study 2018

WPP 54

1 EMPLOYER OF CHOICE FOR ALL

CELEBRATING DIVERSITY AND

DEMONSTRATING PURPOSE

• Commitments on racial equity including investing $30 million over three years and publishing our diversity data annually
• New Inclusion Index to better understand our people's experience of inclusion and belonging
• Partnerships including Valuable 500, Unstereotype Alliance, LaGrant foundation and others
• Signatory of Women's Empowerment Principles
• Public commitments on Sustainability
• New Supplier Diversity policy

WPP 55

2 MODERNISATION OF EXPERIENCES

OUR LONG TERM PLAN

OUR PEOPLE

• Improved experience as new joiner
• User-friendlyself service tools
• Easy mobile access
• AI-drivenview of performance, development and career opportunities
• Access to live job opportunities across WPP brands
• Access to global mobility programme with standardised processes
• Employee data secure

OUR LEADERS

• Real-timedata and analytics for better decision-making
• Improved measurement and reporting DE&I KPIs
• Ability to quickly resource accounts with right talent
• Career framework for talent development and succession planning
• Ensured performance-based compensation decisions
• Able to more easily deliver data for audit

OUR CLIENTS

• Better able to match employee skills with client needs
• Client lead performance measured and development plans aligned with client needs
• Build diverse client teams
• Data availability will facilitate new business opportunities
• Expand core skills, capabilities, and offerings

WPP 56

3 GROWTH

GROW YOURSELF		GROW YOUR TEAM		GROW YOUR BUSINESS
• Doubling investment in leadership		Endless career path		Walgreens Boots Alliance win,
development programmes for 2021				using cross-agency teams
• Investment in capabilities learning
for the future
• Inclusion training and workshops

New Career Explorer

WPP 57

LONG TERM FINANCIAL INVESTMENT

EMPLOYER OF CHOICE FOR ALL

• Embedding Diversity, Equity and Inclusion into talent processes
• More inclusive employee experience informed by analytics
• Build out early career diverse talent pipeline partnerships

MODERNISATION OF EXPERIENCES

• Analytics on skills, certifications, productivity, mobility & client impact
• New technology and better systems integration designed with a people-first lens

GROWTH

• Leadership development programmes
• Learning focused on the capabilities of the future
• Mobility & career pathing to ensure retention

WPP 58

HOW WE WILL MEASURE SUCCESS

KEY PERFORMANCE INDICATORS FOR PEOPLE

1. Improvement in Employee Net Promoter Score (ENPS)
2. Improvement in diversity, equity & inclusion metrics
3. Client satisfaction & wins metrics
4. Learning and certification metrics
5. Attrition/churn metrics

WPP 59

BUILDING CULTURE THROUGH PURPOSE

Using the power of creativity to build better futures

PEOPLE	PLANET	CLIENTS	COMMUNITIES

Attract, retain	Accelerate the transition	Deliver extraordinary	Drive change in the
and develop our	to a sustainable world	work through the	world around us
people in a
	best people and a
culture that is
open, optimistic		unifying purpose
and extraordinary

WPP 60

COFFEE BREAK

WPP TV 5 MINS

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WPP'S FINANCIALPLAN

WPP'S FINANCIAL PLAN

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2

3

4

ACCELERATED	GROWTH FUNDED	CLEAR CAPITAL	ATTRACTIVE
GROWTH THROUGH	AND MARGINS	ALLOCATION	FINANCIAL
INVESTMENT	IMPROVED THROUGH	FRAMEWORK	OUTCOMES
	GROUP-WIDE
	TRANSFORMATION
	PROGRAMME

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1 ACCELERATED GROWTH THROUGH INVESTMENT

M&A OF £200-400M

P&L INVESTMENT

ANNUALLY TO ADD 0.5-1.0% GROWTH

RISING TO £400M

ANNUALLY BY 2025 TO

DRIVE INCREMENTAL 1.5%

GROWTH

"CORE"

GROWTH 1-2%

Core Growth		P&L Investment		M&A

MEDIUM-TERM GROWTH POTENTIAL

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1 TARGETING 40% OF OUR BUSINESS IN HIGHER GROWTH AREAS BY 2025

SALES MIX ACROSS OFFER PILLARS

12%

8%

20%

5%8%

Technology

Commerce

17%

Experience

Communications

75%

55%

WPP 2019 sales mix

Market sales mix

SOURCE: Market sales mix all IDC, apart from Communications (GroupM/WPP)

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1 SHIFTING SALES MIX TOWARDS HIGHER GROWTH AREAS

SHIFTING THE OFFER MIX

ADDRESSABLE GROWTH RATE

+3.5%+4.8%

25%

40%

75%

60%

+5.6%

50%

50%

WPP sales mix		40/60 target	2024 TAM mix
		Communications		Experience/Commerce/Technology

SOURCE: Market sales mix all IDC, apart from Communications (GroupM/WPP)

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1 TARGETING SECTOR OPPORTUNITIES

RENEWED GROWTH WITH	CONTINUE TO GROW		COMPLETE RECOVERY		FOCUS EFFORTS IN
CPG SECTOR			WITH TECH SECTOR		IN PHARMA/HEALTHCARE		UNDERWEIGHT SECTORS
27%	26%							E.G., FINANCIAL SERVICES
			18%
			12%	13%	12%
							6%
							4%

2016

9M 2020

2016

9M 2020

2016

9M 2020

2016

9M 2020

PROPORTION OF REVENUE LESS PASS-THROUGH COSTS FROM OUR TOP 200

CLIENTS FOR EACH SECTOR

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1 INNOVATIVE ENGINES OF GROWTH IN MEDIA

• Programmatic is 80-90% of digital display in US and UK
• Xaxis expected to capture double-digitsmarket growth
• New markets (in Europe and Latam), new clients
• Omnichannel video powered by AI (Copilot)
• Native and influencer with strong momentum
• Audio, DOOH moving to programmatic

• 63% YoY growth in US internet-connected devices usage, Q2 2020
• Roku (AVOD) nearly 50% of total US internet-based viewing minutes in Q2
• Finecast progress:
• • Deep technology integration with broadcasters
  • Supported by GroupM purchasing scale
  • +27% LFL revenue less pass-through costs in H1; H2 acceleration forecast
  • Rapid footprint expansion: 11 markets by end 2021

* eMarketer, 2019 - Programmatic Digital Display Ad Spending report

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1 INVESTING IN HIGHER-GROWTH MARKETS

	BRAZIL: 2.4% OF WPP		CHINA: 6.7% OF WPP		INDIA: 2.5% OF WPP
18
						Total CAGR: 9.3%
	Total CAGR: 12.6%			200				18		Total CAGR: 16.7%
16		Digital CAGR: 9.8%				Digital CAGR: 10.4%					Digital CAGR: 21.1%
							16
14							150							14
12													12
10							100							10
8													8
6														6
4							50							4
2														2
-							-							-
2020	2021	2022	2023	2024	2020	2021	2022	2023	2024	2020	2021	2022	2023	2024

DigitalNon-Digital

SOURCE: GroupM 'This Year Next Year' report total advertising spend

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1 SUMMARY INVESTMENT PLAN

Goal to grow in Communications, and to increase the share of our business in Experience, Commerce and Technology to 40% by 2025

£ MILLIONS	ANNUAL REINVESTMENT	COMMENTS
	BY 2025
INCENTIVE POOL	c.100	Rebuild incentive pool to historical levels: target 3-4%
		of revenue less pass-through costs from c. 2.5% today
TECHNOLOGY	c.150	Increased investment in technology and enterprise IT
TALENT	c.150	Increase in fee-earning heads in growth areas,
		investment in training to build capability
TOTAL	400

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1 SCALABLE M&A IN GROWTH AREAS

COMMUNICATIONS		EXPERIENCE

MEDIA

• Enhance planning and strategy offer
• Offshore / flexible delivery models
• Performance media

CREATIVE	SCALED CUSTOMER EXPERIENCE BUSINESSES
• Exceptional creative	• End to end digital customer journey design and implementation

agencies to underpin	• Expand experience consulting and delivery in USA and Asia
our creative core

COMMERCE			TECHNOLOGY
DIGITAL COMMERCE	MOBILE & SOCIAL COMMERCE		MARTECH	EXPANSION		DATA SCIENCE
• Scale existing solutions to	• Functional specialists to		CONSULTING &	INTO CORE IT		AND PREDICTIVE
	IMPLEMENTATION	CONSULTING		ANALYTICS
meet global demand	build global capability

TO COMPLEMENT

MARTECH OFFER

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2 GROWTH FUNDED AND MARGINS IMPROVED THROUGH GROUP-WIDE TRANSFORMATION PROGRAMME

BY 2025…

	250		200
		MARGIN IMPROVEMENT
	FUNCTIONAL EFFECTIVENESS/
	SHARED SERVICES
	200
	EFFICIENCY		400
	(PROCUREMENT AND PROPERTY)
		REINVESTMENT
	150
	OPERATING MODEL
	Savings		Outcomes

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2 FUNCTIONAL EFFECTIVENESS AND SHARED SERVICES: £250 MILLION OPPORTUNITY

CURRENT COST OF FINANCE

c. 4%

OF REVENUE LESS PASS-THROUGH COSTS

MODEL TODAY

• Dispersed, siloed and unbalanced functions in Finance, HR, IT and legal
• c. 8,000 Finance employees
• > 3,000 business units in c. 100 countries, > 300 financial systems
• Non-standardisedways of working
• Very detailed reporting requirements

FUTURE MODEL

• Single, federated approach to global business functions
• End-to-endprocess simplification and standardisation
• Automation, shared services at scale
• Streamlined reporting and control framework
• Data-driveninsights for improved decision-making - leading not lagging indicators
• Agencies empowered to focus on winning and delivering client business
• Improved talent mobility

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2 EFFICIENCY:

£200 MILLION OPPORTUNITY

REAL ESTATE

CURRENT ESTABLISHMENT COSTS

c. 6%

OF REVENUE LESS PASS-THROUGH COSTS

PROCUREMENT

INDIRECT SPEND

c. £2B

MODEL TODAY

• Campus strategy in place since 2018
• Already a third of people in 20 campuses
• Still multi-site even in cities with campuses, eg London, NYC. Scope for further consolidation

MODEL TODAY

• Inconsistent centralisation and pooling of scale
• Many goods and services still separately negotiated at agency level
• Prices can range by +/-25% by brand for same goods/services

FUTURE MODEL

• Post COVID opportunity to utilise space more intensively within existing and future campuses
• Increase levels of shared/flexible space within campuses
• Target of 85k people in 65 cities on campus by 2025
• Reduce space requirements by 15-20%

FUTURE MODEL

• Optimised and diverse supplier network
• Simplification of processes -mindful contracting
• Full adoption of analytic tool during 2021

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2 OPERATING MODEL:

£150 MILLION OPPORTUNITY

	MODEL TODAY	FUTURE MODEL
• 10+ different, opaque country	•	3 clearly-defined country
	operating models		models
• Long tail of small agencies in	• Significant consolidation of local
	unprofitable countries		agency operations
• Too many management layers	•	Simplified org. structures
• Duplication of effort in eg	•	Standard, connected global
	technology, production assets		platforms, leveraging our scale
• Significant travel and personal	• Permanent change to ways of
	costs		working post COVID

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2 SAVINGS UNLOCKED BY SIGNIFICANT CAPITAL INVESTMENT

• Capex forecast at £450-500 million in 2021 and 2022
• Partially relates to delayed 2020 capex
• Investments in campuses, ERP and shared service centres driving the majority of efficiency savings

600

500

400

300

200

100

0

2021	2022	2023	2024	2025
			Property		IT	Other/range

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2 APPROXIMATE PHASING OF THE GROSS SAVINGS TARGET

700

600

600

525

500	450

400

300

300

200

200

100

0

2021	2022	2023	2024	2025
		Operating model		Efficiency		Functional/shared services

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3 CLEAR CAPITAL ALLOCATION FRAMEWORK

• Invest in growth, with a goal to increase net sales from Experience, Commerce and Technology to 40% by 2025
• Provide shareholders with an attractive and sustainable return, combining capital growth and income
• Maintain a strong and flexible balance sheet (leverage target of 1.5 - 1.75x average net debt/ EBITDA), with excess capital returned to shareholders

Capex investment in our estate,

technology and capabilities

Recommence remaining £620m Kantar buyback in 2021; Return any subsequent surplus capital via buyback or special dividend, as appropriate

A sustainable, progressive dividend, set at around 40% of

headline EPS

Targeted acquisitions, £200-400m annually, to enhance our offer in key growth areas

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4 STRONG FINANCIAL OUTCOMES

RAPID POST-COVID

RECOVERY

LFL revenue less pass-through costs to grow mid-single-digits % in 2021 and 2022

ACCELERATED	IMPROVED
MEDIUM-TERM GROWTH	PROFITABILITY
Targeting revenue less pass-	Targeting headline operating
through costs growth of 3-4%	margin of 15.5-16.0% in 2023
annually from 2023

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4 2020 OUT-TURN AND INITIAL 2021 GUIDANCE

2020 Q4 CURRENT TRADING

• LFL revenue less pass-through costs
  -6.7% Oct/Nov 2020
• • -8.4%YTD
  • Full year outcome expected to be in line with YTD performance
• Headline operating margin 12.5-13.0%
• Year-endnet debt around £1.6 billion, continued working capital focus

2021 OUTLOOK

• Mid-single-digitgrowth in LFL revenue less pass-through costs
• Returning to growth in Q2
• Headline operating margin 13.5-14.0%
• Net finance costs similar to 2020
• Pre-associatestax rate c 24%, rising c. 0.5% annually
• Capex £450-500 million

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WPP'S FINANCIAL PLAN - SUMMARY

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23

4

ACCELERATED GROWTH THROUGH INVESTMENT

• Accelerating through growth in Communications and expanding Experience, Commerce and Technology from 25% today to 40% by 2025
• Targeting sector opportunities eg CPG, Tech, Healthcare
• Innovative engines of growth in media eg Xaxis, Finecast
• Capturing the opportunity in higher growth markets eg Brazil, China, India
• 2021-2022- recovery
• 2023 onwards - accelerated growth
  o 1-2% core business growth potential medium-term
  o c 1.5% incremental growth from investing c£400m p.a. in technology, talent and incentives
  o 0.5-1.0% incremental growth from investing £200-400m p.a. in high growth, scalable acquisitions

GROWTH FUNDED AND MARGINS IMPROVED THROUGH GROUP-WIDE TRANSFORMATION PROGRAMME

• Plans in place to target £600 million of annual gross-cost savings by 2025
• Annual net cost savings of £200 million expected by 2025 after £400 million reinvestment in growth
• Savings phased over the next five years
• Key areas of efficiency:
  o Operating model savings (e.g. new ways of working, consolidating data and technology investment, simplified country structure, stream-lined organisational structures);
  o Efficiency savings (Procurement, Real estate); and
  o Functional Effectiveness & Shared Service savings (Legal, Finance, HR, & IT)
  o Efficiencies unlocked by significant capital investment in our campus programme, ERP systems and shared service centres
• Efficiency measures will also enhance effectiveness: improving business insight and talent management, leaving agencies free to focus on growth

CLEAR CAPITAL

ALLOCATION FRAMEWORK

• Capex £450-500m p.a. expected in 2021 and 2022, reverting to £300- 350m p.a. from 2023 to fund cost savings programme
• Intention to pay a progressive dividend at around 40% pay-out ratio
• £200-400mp.a. for high-growth, scalable M&A
• Average net debt/EBITDA maintained in target range 1.5- 1.75x
• Kantar share buyback programme to resume in 2021

ATTRACTIVE

FINANCIAL OUTCOMES

• Rapid post-COVID recovery: LFL revenue less pass through costs is anticipated to grow mid-single digits over each of the next two years, recovering to 2019 levels through 2022.
• Accelerated medium-term growth: revenue less pass through costs anticipated to grow 3-4% from 2023 onwards
• Improved profitability: targeting 15.5%-16.0% operating margin in 2023
• Double-digitEPS growth over the next three years

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HOW WE WILL DELIVER THIS PROGRAMME

1

Simplified and stronger brands and countries

Intra-brand simplification

(Brand CEOs1)

Country

(Andrew Scott + Brand CEOs)

Steering Committee (ExCo)

2		3
Functional effectiveness		Incentives and
	performance management
Finance		Incentives
HR		(Jacqui Canney)
Enterprise IT		Performance mgmt.
	(John Rogers)
(John Rogers + Global CFOs
Jacqui Canney + Global CPOs

Rachel Higham + Global CIOs)

4

Accelerated

capability building

Talent & development2

(Jacqui Canney)

Data and tech2

(Stephan Pretorius)

Production

(Richard Glasson)

	Integrated plan/ Programme management
Integrated plan	Programme management
(John Rogers)	(John Rogers)

Change communications

(David Henderson)

1. Includes Specialist Communications
2. Starting point is offer articulation	WPP	82

ADDITIONAL ANALYSIS/ DISCLOSURE

• Aim to provide split of business by four pillars at full year and half year:
• • Communications, experience, commerce, technology
  • From H1 2021
• Increased GroupM insight
• • Revenue, revenue less pass-through costs
  • Billings breakdown between digital/ traditional
• Ongoing updates to Group transformation programme
• Ongoing updates to our People strategy & KPIs

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SUMMARY

SUMMARY

• Focus on growth, profitability and returns, driven by client demand for our services
• Converting size into scale: data, media, technology
• People, culture and ESG at its heart
• Reducing inefficiency, investing in faster-growing areas
• Greater insight into underlying business performance
• Clear and investible capital allocation

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Q&A

ONE HOUR

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