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Penny Machines

Cherries
oil on canvas
22 x 20 in
1981

Penny Machines
oil on canvas
23¾ x 29¾ in
1961

Stack of Books
oil on canvas
30 x 24 in
n.d.

Seven Suckers
oil on canvas
19 x 23 in
1970

Twin Jackpots
oil on canvas
30 x 46 in
1962

Ties
oil on canvas
20 x 26 in
1980

Cake Slices
oil on canvas
20 x 16 in
n.d.

Kantar

Report by Eric Salama (below)
Chairman and chief executive officer

Eric Salama

Lessons from Malawi

Given the enormity of the challenges presented by the economic climate and by the integration of TNS, Malawi may seem like a strange place to start this report. But that is where six of us found ourselves early in 2010, travelling the country and seeing for ourselves the way in which UNICEF had used the $500,000 of donations Kantar people had raised.

You can imagine some of my reactions to that week – a renewed promise never to take things for granted and a huge pride in the way that Kantar employees have continued to help the communities in which they work and live (and by the way not just through UNICEF but through numerous local programs in which we are involved such as Added Value and township.co.za, Millward Brown North America and Habitat for Humanity, TNS Poland and Precious Gift Program).

But the week also highlighted two things:

  • All the projects we saw had adequate funding but there was a huge difference in the effectiveness and value delivered between them, stemming from one factor: the motivation, determination and vision of the individuals driving them.
  • The things that the project directors yearned for was a mixture of the big (e.g. more drugs, more doctors) and the small (e.g. fix the broken solar panels, have a washing machine in the malnutrition ward to speed up the process of getting clean sheets back onto the beds).

And so it is in our business. Our clients and our people need to see progress in big and small ways and our ability to deliver depends on the performance of talented individuals. The economic climate and scale of the challenge involved in integrating TNS could have paralysed us but it didn’t. We emerge from 2009 stronger with much of the restructuring behind us and with significant progress in improving the output and value which our clients receive.

Our ambition

Our ambition is simple: to inspire our clients and people, and to contribute to WPP’s success:

  • Developing profound insights and high-quality data; delivering them to clients at the right time and in such an engaging and creative way that they propel clients to make better decisions.
  • Having a work environment in which talented passionate people can develop and succeed and be rewarded appropriately.
  • Growing our revenues ahead of the market while improving our margins.

As Stan Sthanunathan, VP marketing strategy and insights at Coca-Cola put it recently: “It is not about following the change as quickly as possible. It is about helping companies to shape that change. Focus on creating the future, not predicting it.”

With that ambition in mind, how did we do in 2009?

Inspiring clients

Data quality

The quality of our data is a core foundation of both our survey research and syndicated outputs and a prerequisite to adding value to clients.

Kantar Media launched the new BARB panel in the UK with incredible skill and professionalism. Never before have we seen such a smooth transition to a new TV measurement system which has benefited media owners, clients and agencies. The unit also won the Turkish TV measurement contract and the Norwegian internet contract and retained the business in markets as diverse as Israel, Slovakia and Poland. In all of these markets, accuracy of ratings and innovation designed to deal with fragmentation of viewing and listening habits are critical and it is gratifying to be recognised through commercial success.

David Geiger, Sharon Potter, Josep Montserrat, Thomas Pulliyel, Janine Hawkins, David Day

David Geiger, CEO, Center Partners, Sharon Potter, CEO, Kantar Operations, Josep Montserrat, CEO, Kantar Worldpanel, Thomas Pulliyel, CEO/president, IMRB, Janine Hawkins, CEO, Added Value, David Day, CEO, Lightspeed Research (above)

This emphasis was replicated in many other areas such as our social and polling and consumer panel businesses. TNS Infratest was the most accurate pollster in seven out of eight of the federal and state elections which occurred in Germany in 2009. TNS retained the prestigious Eurobarometer contract, with the client well known for the importance it attached to data quality. And Kantar Worldpanel is in the process of rolling out bigger samples in Thailand, Spain, Portugal and most ambitiously China, where we are moving from a 17,000 paper and pencil sample to a 40,000 electronic scanning one. Not for the sake of it but because it enables our clients to plan and predict with greater impact. Innovation and quality, hand-in-hand.

On the survey side, we recognise the issues involved in online data collection and respondent co-operation and the importance which clients such as Procter & Gamble, Coca-Cola, Microsoft and others attach to it. Our InTouch initiative has pioneered ways in which online surveys can be made shorter, more engaging and simpler to understand; Lightspeed RealRespondents delivers real-time quality checks and is being rolled out globally; and we have partnered with competitors and through the Advertising Research Foundation to ensure that appropriate cross-company-panel overlaps and exclusions are dealt with. The recruitment of Kim Dedeker, formerly head of Procter & Gamble’s worldwide research function and of Efrain Ribero, COO, Lightspeed Research, are evidence of our desire to lead the industry in this area.

Integration

Our clients want to be able to join up the dots, to integrate sources of insight, to follow consumers round the web while ensuring their privacy, to make more of what they already have. Combining survey and behavioural sources of insight is a critical part of our strategy as is fusing streams of insights for the benefit of clients. Clients rightly want to make more of what they have got and the opportunities afforded by working with specialist businesses across Kantar are huge.

In this respect 2009 marked a year of huge progress. Clients such as Kellogg and France Telecom benefited from incorporating TNS’s Needscope segmentation into the tracking they do with Millward Brown; Kantar Retail and Compete (a Kantar Media company) came together to launch a solution which measures the impact of online campaigns on offline purchases; Kantar Media and Millward Brown Dynamic Logic combined digital online advertising effectiveness and social media and online behaviour tools to help clients link behaviour and marketing effectiveness; Millward Brown launched a tool to measure and predict the effectiveness of viral video on brand equity and further enhanced their cross-media offer to enable better media allocation decisions to be taken; we are clickstream-enabling our internet access panels in five markets around the world so that clients can carry out surveys and understand the digital behaviour of the consumers they are surveying; are working with GroupM and 24/7 Real Media to improve the quality of media targeting; and we are in the process of launching a new offer to measure viewing of online video.

Innovation

If we are to inspire our clients, we must help them see the world through new lenses. Hence the emphasis which Millward Brown has put on the use of neuroscience to tap into the unconscious and enrich our understanding of how communication works; the work that IMRB is doing with JWT in understanding the rural consumer in India; that TNS is doing with Ogilvy in understanding the Islamic consumer; that Added Value is doing in using semiotic techniques to understand the way in which consumers are reacting to visual and other sensory cues; the wide range of ethnographic projects which we now undertake which bring our clients closer to the reality of the world which their consumers inhabit.

open quoteOur clients want to be able to join up the dots, to integrate sources of insight, to follow consumers round the web while ensuring their privacy, to make more of what they already haveclose quote

And it’s not just short-term or high-tech innovation that we are focused on. We are heavily involved in most of the research projects sponsored by WPP and Google, involving clients and academics. And TNS Indonesia won the prestigious ‘best paper’ award at ESOMAR’s global conference for developing an innovative diary method for better understanding how illiterate rural consumers used toothpaste.

Creativity

Our focus is on making our deliverables more accessible, more engaging, more impactful, more forward-looking. And in those respects we had tangible signs of progress which benefited clients.

BrandZ insights were delivered through an iPhone application; WorldpanelOnline is transforming the way clients access panel data; Added Value’s Charac+erLabis a unique approach to brand character development which clients can create and deliver to themselves online; and RedDot has become the virtual reality platform of choice for most of the world’s top retailers and packaged good companies, enabling improvements in supply chain management, pricing and product testing which will become more commonplace in years to come. But remember, you saw it here first!

Much more of our output now takes the form of video and storytelling which engages and inspires. And more broadly, some of the best work we carried out and some of our best deliverables were based on innovative analysis, not more data collection. The Futures Company and Kantar Worldpanel combined their future segmentation approach and panel data to enable Morrisons and their packaged-goods suppliers to understand the way in which UK consumers were reacting to the recession and to predict how their behaviour would change going forward. Strategic work for Pepsi and Unilever involved no new data collection and instead centred on analysis and testing of creative hypotheses to improve performance in various markets.

There is much more to do but we all recognise that how we deliver our insights is as important a determinant for clients to make better decisions as is the nature of the insights themselves.

Inspiring people

While there are some high spots and some parts of the world where our management teams have done wonderful things in difficult circumstances, we have to acknowledge that too many of our people did not find 2009 inspiring. It was a tough year in which our headcount fell by 8% during the year, in which some people voluntarily took salary cuts, in which the client agenda of ‘more for less’ meant that people were stretched as never before and in which many finance, operations, IT and HR people had to deal with one of the most complex integrations that our industry has seen. And while the integration activities described below are improving our business immeasurably and to the benefit of our people and clients, 2009 saw much of the pain involved in this process with little of the gain – a situation which will thankfully reverse itself in 2010.

At the same time our employee-wide survey shows that our people continue to have huge pride in our business, faith in our direction and trust in our management. They know that we successfully carried out much of the cost and infrastructure work which was necessary, training and development budgets have been restored to higher levels and that there is a unanimous determination amongst senior management across the business to put back the emphasis on people issues.

Reshaping the business

Some units – notably Kantar Worldpanel, Kantar Media Audiences, Center Partners, TNS Social and Polling, Kantar Operations, Millward Brown Asia Africa and LatAm – had good years financially. Overall our results will have disappointed our high expectations, but we should be pleased with the progress we made in integrating TNS and in generating the synergies we committed to.

We restructured the business in a way which has made it easier for clients to access the best of what we have, creating dedicated units in Kantar Health, Kantar Japan, Kantar Media, Kantar Retail, Kantar Worldpanel and in merging the TNS custom business with Research International. All have had their inevitable complexity and required close attention to detail with the latter particularly intense, physically merging in 27 countries around the world and dealing with the multitude of property, legal, minority shareholder, client and people issues involved. Great credit to all of the people involved for coming out of 2009 with the vast majority of that work done and the teams largely able to refocus externally.

And lest anyone think that this is just about cost synergies, take a look at Kantar Health as an example. There have been some savings but the business is an immeasurably stronger partner to its clients. With over 600 healthcare specialists, the business is a leader in global drug pipeline consulting (including science and technology); market and customer understanding; product positioning and message; outcomes research and disease management. Quite apart from the survey and syndicated sides of our business, we also have the world’s largest healthcare professional internet access panel, a network of over 90 oncology specialists across major and emerging growth markets and a safety practice that offers pharma clients worldwide post-authorization Drug Safety and Outcomes programs, recognized and recommended by approval authorities like the FDA and the European Medicines Agency.

At the same time we now enter year two of a three-year program to consolidate our infrastructure. The goal is to reduce our costs, speed up the time with which we are able to make decisions, improve the consistency and quality with which we can carry out multi-country work for clients and release money to invest in technology applications. This work involves many streams but at their core are three-year programs to:

  • Merge the Lightspeed and TNS 6th Dimension internet access panels which will result in the largest access panel in the world.
  • Develop a common operations structure through Kantar Operations with shared data collection platforms, a vastly reduced number of software platforms, a better mix of onshore and offshore capabilities for our data processing and scripting needs, more centrally driven innovation around surveys and their application to mobile, PDAs, etc.
  • Create a single IT infrastructure and email platform, a single HR information system and a single financial system, all of which are designed to reduce the proliferation of platforms we need to support, reduce the amount of time spent on non-value adding activities, speed up our ability to analyse activity and make better decisions on the back of that analysis and improve our ability to share knowledge and best practice around the group.

It is an ambitious plan which our people are executing with a high degree of dedication and skill and which will reap enormous rewards in years to come. We are on time and on budget and expect to remain so.

Wayne Levings, CEO, Kantar Retail, Lynette Cooke, CEO, Kantar Health, Masanori Miyajima, CEO, Kantar Japan, Eileen Campbell, CEO, Millward Brown, Jean-Michel Portier, CEO, Kantar Media, Sian Davis, CEO, The Futures Company, Pedro Ros, CEO TNS (below)

Wayne Levings, Lynette Cooke, Masanori Miyajima, Eileen Campbell, Jean-Michel Portier, Sian Davis, Pedro Ros

And finally...

One of our clients recently described his state of mind as “pleased but not satisfied”. While none of us can be pleased or satisfied with our performance in 2009, it is how I feel from a business transformation point of view.

We are doing great work for many clients in many places and get recognised for doing so through various awards at both an individual and corporate level. IMRB was voted best agency in India, Millward Brown was recognised for its outstanding contribution to UK research and won company of the year in Poland and their clients won nine Ogilvy Effies, Kantar Health won Eli Lilly’s best insight award for work in the insulin category, Stephen Palacios of Added Value was honoured by Target as best contributor, George Shababb and Larry Friedman and others were recognised as ARF Great Minds. The list is much longer. But our ambition is far greater. We want to see clients thrive by partnering with us and we want our people to benefit and improve by working for us. Not just occasionally or in some places but everywhere, all the time.

We know that we are unique in many respects – in being global and big in most local markets; in having a mix of data, insight and consulting skills; in being able to work at a high level across a wider spectrum than any competitor spanning measurement, innovation, branding, customer experience, futurology; in having specialist businesses working together for the benefit of clients; in having an opportunity to use the integration of TNS to make us a more effective and higher margin business.

We know what we need to do; in true research fashion we measure our financial progress, employee engagement and customer satisfaction in every unit around the world regularly so we are never deluded about ourselves; and we are collectively determined.

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