WPP has signed an £800m big data deal with IBM to transform the group’s global technology platform and launch new digital services to help its clients get closer to their customers.
As part of the seven-year agreement, IBM will provide a service delivery and technology platform that allows WPP to integrate its data and technology operations, while boosting productivity.
The company says the benefits of the hybrid cloud infrastructure will be four-fold: it will expand big data and analytics to drive decision-making; bolster the creative process; help its digital and mobile operations; and allow it to speed up the launch of products and services across its network.
WPP Group chief information officer Robin Dargue said: “As the world’s largest communications group, we are seeking to exploit IBM’s cloud computing expertise to allow us to innovate and add value to both the service and the product we deliver to clients across 111 countries.”
Earlier this year, WPP boss Sir Martin Sorrell admitted that the rise of big data was having a negative effect on its profits after revealing its so-called “data investment management unit” had struggled to match the UK growth rates across the rest of the business.
The firm said the performance of the UK data division, made up of companies such as KBM Group, GroupM, Kantar and WPP Digital, was “difficult”, with operating margins improving just 0.3 points to 10.3%. It attributed the relatively poor performance to companies using their own data, as opposed to being reliant on third-party information.
However, since then the group has boosted its own big data operations, by launching OgilvyAmp; the agency will have a team of more than 300 data and analytics professionals across the network, and will work with WPP’s Data Alliance division, which includes Wunderman-owned KBM, GroupM, Kantar, and WPP Digital.
This summer, rival Omnicom signed a global deal with Salesforce to build a huge CRM platform, enabling agencies in the group – such as Rapp, Proximity, DDB and TBWA – to offer clients the ability to track every customer interaction.
Omnicom signs mega CRM contract
WPP sets up O&M global data agency
Worboys nets top Wunderman role
WPP profits hit as big data bites
WPP boosts Data Alliance division
WPP to swell £10bn data revenues
Analysts urge WPP: buy data firms
Mega agency deal sparks job fears
Prism-gate row: now Sorrell wades in
DM, digital at heart of WPP boom
Wunderman boosts data operation
Worboys moves up in KBM rejig