WPP's bid to decarbonise means virtual production shift, while publishers must clean up or lose ad dollars
WPP's carbon footprint is equivalent to that of a small country - literally. But last week it committed to reaching net zero emissions across its entire supply chain by 2030. That has major implications for production house Hogarth, which accounts for more than half of WPP's production emissions, according to global CEO Richard Glasson. Meanwhile, WPP's supply chain includes publishers. So media owners that want WPP client dollars must also decarbonise – fast.
What you need to know:
- WPP has committed to net zero carbon emissions by 2025, and net zero across its entire supply chain by 2030
- WPP produces 5.4 million tonnes of CO2: the equivalent of Uganda's annual emissions
- Hogarth CEO Richard Glasson says his businesses accounts for more than half of production emissions and virtual production will increase dramatically
- WPP CEO Mark Read and Hogarth's Glasson say decarbonisation agenda will determine which media owners they work with
- Net zero will become standard, Glasson says, and they will have a "roster of net zero partners"
- "No more trips to the beach in South Africa" for clients
It will absolutely impact where we place our advertising over the next nine years... Those companies that move more quickly will have a competitive advantage.
This is the way
When director Jon Favreau set out to make Star Wars series The Mandalorian, he turned to the Unreal Engine made by video game creator Epic. The 3D gaming technology meant he could render complex and exotic digital backgrounds – an immersive intergalactic world, for example – in real-time, all while shooting the series at a studio in Los Angeles.
“We’ve been experimenting with these technologies on my past projects,” Favreau told Indie Wire. “The system we built was the most efficient way to bring ‘The Mandalorian’ to life.”
The switch to more virtual production had many benefits, especially during a worldwide pandemic. There were fewer travel logistics and lower costs, but also lower carbon emissions. It didn’t go unnoticed: the gaming industry and Hollywood have started a much needed green revolution in production. Now, the advertising industry is looking to do the same.
Last week, WPP announced it would be making an industry-first global commitment to reach net zero carbon emissions by 2025 – and net zero across its entire supply chain by 2030.
“We aim to raise the bar for the whole sector,” per CEO Mark Read. And it's a heavy bar.
WPP says its footprint is 5.4 million tonnes of carbon dioxide, equivalent to the annual emissions of Uganda.
About 98.3% of the company’s total footprint comes from things like production (the lion's share) as well as from media partners like broadcasters and publishers that display their ads.
By committing to decarbonise its supply chain within a decade, emissions from partners will therefore become a major factor in where WPP buys ads.
“It will absolutely impact where we place our advertising over the next nine years,” Read told Bloomberg. “Those companies that move more quickly will have a competitive advantage.”
To achieve its goal, WPP will:
- Source all its electricity from renewable sources by 2025. Currently, the figure is 65%.
- Publish its progress in their Annual Report.
- Report progress via the Carbon Disclosure Project, a not-for-profit charity.
- Submit its targets to the Science Based Targets initiative.
WPP is reliant on having a very strong influence in driving the behaviour of the media owners. The influence and the buying power WPP has, we need to play a dominant role.
Pushing media owners
WPP's production unit, Hogarth Worldwide, undertakes about 1,500 shoots a year. CEO, Richard Glasson, told Mi3 the business, with some 4,500 employees, is responsible for “significantly more than half” of WPP’s production-related global carbon emissions, and that its pledge represents a seismic shift for the creative production industry.
“WPP is reliant on having a very strong influence in driving the behaviour of the media owners,” Glasson says. “The influence and the buying power WPP has, we need to play a dominant role.”
Hogarth will be building the cost of offsetting carbon usage into the bill for its clients. Shooting in a studio can be 10-30% more cost effective than traditional production, Glasson says, and can produce vastly more content for the same price. Its internal workflow system will automatically generate the carbon effect - and cost - of a project.
But he said virtualisation is not just virtuous in terms of cutting out other emissions. Clients get more bang for their buck.
“We did a huge project with Volvo. Rather than just build a computer-generated set, we used laser capture and video capture, we mapped a real forest in Scotland,” Glasson said.
“Any time we wanted to put any car in that sequence, it’s a case of rendering and colouring. We now have a Volvo in a forest, and they can use that for anything they want.”
Justin Ricketts, Hogarth's Australia CEO, said Australian clients are warming to virtual production techniques.
"Not only do you get more, you get a more personalised experience for an audience," he said. "You’ve got the ability to change the background. If you take a car, for example, you can place the car in the outback, a ski mountain, you can localise the context. In the old way, you would have had to do a separate shoot in each location."
Per Glasson: "One client joked that there'd be no more trips to the beach in South Africa."
Not having a competent Environmental, Social and Corporate Governance plan, a competent net zero plan, reduces your ability to be investable. This is very quickly going to become the table stakes.
Asked how WPP’s net zero pledge could impact media owners, Glasson said he could not speak directly for the media side of the WPP's business. But he said it would be analogous to the approach taken by his production operation.
"What we’ll be doing, it’s not about abdicating responsibility, it’s about explaining what the choices are. Our media partners are the client’s choice. [Similarly] if we have a director a client wants to work for them, and they really want to cause harm to the environment, ultimately it’s a client choice if they want to go down that route,” he said.
“Where this will lead is to a pre-approved roster of net zero partners who’re prepared to work in this way. WPP’s scale means we’re able to have quite a strong influence.”
WPP’s sustainability commitments and move to virtual production should be lauded – but will come under scrutiny from suppliers and competitors, according to Paul Connell, Head of Marketing and Sales at Naked Wines.
“This year has made everyone realise what can be done without flying everyone out. Everyone has been positively surprised, in a really, really good way,” he said.
Connell is a former Unilever general manager who also founded Build on Purpose, a consultancy that helps brands integrate their purpose and desire to do good into concrete actions.
He said WPP’s move will become standard practice, but by virtue of being one of the first, WPP will need to ensure its claims are watertight.
"Not having a competent Environmental, Social and Corporate Governance (ESG) plan, a competent net zero plan, reduces your ability to be investable. This is very quickly going to become table stakes - and like Fair Trade, it's going to become part of the conversation, part of the norm."
Where this will lead is to a pre-approved roster of net zero partners who’re prepared to work in this way. WPP’s scale means we’re able to have quite a strong influence.
Connell said the sorts of questions WPP will need to answer are: where do groups draw the line between what they count as their supply chain? How does it approach major oil companies, for example, who may be clients and are either genuinely committing to improving or trying to ‘greenwash’?
“WPP has made a really big, bold statement, and that means you’re normally the person who gets asked the most questions. That’s not a bad thing, you just have to be ready for it,” he said.
“It starts the conversation in the industry. Where will the challenges be? Hypothetically, if BP is a global client, do they have the ability to drive behaviour change?”
A trojan horse for cost reductions?
Hogarth's Glasson believes net zero will soon become standard across the industry – as business demand their partners decarbonise to meet their own supply chain commitments.
“When we look at sustainability or environmental causes, it takes me back to 1970s in England. There was a sticker next to the light switch which said, ‘turn it off’. That was about costs,” he says.
“What we’re doing will be table stakes, but I hope we’ll be doing more and changing what those table stakes are. I don’t think it’s a trojan horse [to reduce costs], it needs to be pervasive. I think its linked to the table stakes question. There’s barely a day goes by we don’t see pretty terrible consequences of what we’ve done up until this point.
“It will become standard way of operating, if we can stop talking about being 'sustainably made' in three years’ time, that will be a victory. We see our role as being an agent for change. If it stops being a differentiator in the future, then that’s a good thing.”
The other holding groups:
- Dentsu International says it will become a net zero emissions business by 2030, after achieving 100 per cent renewable electricity worldwide in 2020.
- IPG Mediabrands says it is measuring its energy use and emissions and has set a target to lower emissions 10 per cent by 2030 from a 2015 baseline.
- Omnicom Media Group says is working to reduce energy use by 20 per cent per person globally by 2023 and increase use of renewable energy emissions to 20 per cent of global use by the same time.
- Publicis Groupe says it is aiming for 100 per cent renewable energy by 2030 for the group and aims to be carbon neutral by the same time.
Specsavers head of market and planning, Shaun Briggs, needed a big brand hit to kick-start life after Covid. MAFS was hardly love at first sight. But it quickly grew – literally – as the brand, its agency AJF Partnership, and Nine’s Powered creative unit delivered a bespoke integration within weeks. For Briggs, “it’s been an eye opener”.