Industry outlook A perfect storm continued Our latest three-year plan calls for us to Clients and whoppers double both top and bottom lines over the next I went to a procurement conference recently three years, implying annual growth of 25%. and I was surprised that the tone was notably If anything, the pace of digital transformation cautious, when in fact most clients have had may speed up when the economy slows down, a very good last couple of years. In fact, because in tough times, the change agents clients spent heavily in the fourth quarter, inside companies are given more oxygen. notwithstanding supply chain difficulties and Our third pillar other challenges. When I was on the stage In 2021 we started a new practice area, at Web Summit last year with two senior Technology Services, to sit alongside our marketing executives from Mars and Suntory, existing businesses in digital content; and data, both said they are now using larger numbers analytics and digital media. We combined of agencies and they agreed with our thesis with Zemoga, which started in Colombia and around the importance of agility, and of now has technology specialists located all taking back control. There’s a tremendous across the US, helping companies to digitally propensity to experiment. The old days of transform their business. We’ve already the fixed TV commercial have gone and it’s seen a really encouraging lift in terms of no longer about having the perfect piece of revenues generated from their client base. content. Instead, you develop assets in an Technology services moves us into a new iterative process that we see as being like market where we are competing with firms an election campaign; brands have to get like Globant and Accenture, who are rated elected every day. Our 2020 target – to develop more highly in terms of stock market value. 20 ‘whoppers’ or clients with $20 million of It broadens our reach into client companies: revenue – is on track and last year we added as well as talking to the CMO or the chief sales two more, Meta and HP, to our existing group officer, we’ll now be talking to the CTO and the which includes Google, a major tech company CIO as well. It means we become involved in (with whom we’ve signed an NDA), BMW and systems integration, working with the likes of Mondelez. That’s been achieved primarily Salesforce and Oracle as well as with Adobe. through our ‘land and expand’ strategy rather Now we can talk to clients about what we do than through competitive pitches. We’ve on the sell side, what we do on the marketing identified another 19 that we think have the side and what we do on the IT side and bring potential to become whoppers over the next it all together as one. three years. About 50% of our revenue comes from tech companies, and the reason for that is we work more effectively with the companies that look at the sky rather than those who look at their boots. In what we might call ‘analogue’ Now we can talk to companies, people have tended to be more frightened of change in response to events like clients about what we the pandemic or slowing GDP growth but – ironically – I think they will be more willing to do do on the sell side, what so in future. From cookies to consent we do on the marketing Google’s resolve on third party cookies and Apple’s IDFA decisions have been creating a lot of uncertainty and fog in the digital side and what we do on ecosystem – if there was a VIX index for marketing it would have gone through the roof. the IT side and bring it all It has forced clients to think about alternatives and the implications of what’s happening in a more concerted way. Google has made a very together as one astute decision from a privacy point of view, which is to rein back on the sale of third-party data, (unconsented), and focus on first-party data, (consented). And already some of the big retailers, such as Walmart and Target, are building their own walled gardens. 44 S4Capital Annual Report and Accounts 2021