Matisse (LSE:MAT)
Historical Stock Chart

From Feb 2020 to Feb 2025

Ogilvy & Mather Chief Executive Miles Young doesn't expect any immediate recovery in the advertising market and believes the recession may spill into 2010, he told Dow Jones Newswires Thursday.

"The first and second quarters of 2010 will still be tough for the industry and Ogilvy & Mather," he said in an interview at the Cannes Lions advertising festival.

"There is a strange reluctance to accept that the recession may spill over into next year," said the head of the world's third-largest advertising agency by the number of global clients, which is owned by WPP PLC (WPP.LN).

Still, he thinks one can expect some recovery in the second half of 2010.

"The fact that the first half of 2010 looks still likely to be tough has to be taken into account for media planning as of now, though," he said, adding that clients' media spending at Ogilvy & Mather was holding up well amid the crisis.

"I think we are in line with the market, neither better nor worse," he said. "A lot of our clients, like IBM (IBM), are actually benefiting from the crisis, which gives us hope," Young said, adding that the agency's diversified profile is also helping it in the current downturn.

According to Young, the advertising market's upturn will be sharp once it happens, as "clients are just waiting out there for the right moment to invest again."

Young said Latin America remains a buoyant market, as is Russia and Eastern Europe. He isn't yet seeing signs of a turnaround in Western Europe or the U.S.

China and India may be among the first countries to profit from a recovery.

Ogilvy & Mather did cut jobs, mainly in the U.S., Young said. "It is not impossible that we might have to make some more staff reductions," he added.

He said there weren't many big accounts up for grabs at the moment, as clients have other priorities on their minds. He also denied rumors that Louis Vuitton, one of its most prestigious clients, may withdraw its accounts.

Ogilvy & Mather's other clients include Unilever NV (UN), Motorola Inc. (MOT), Mattel Inc. (MAT), Nestle SA (NESN.VX) and American Express Co. (AXP).

-By Ruth Bender, Dow Jones Newswires; +33-1-4017-1754; ruth.bender@dowjones.com