The Trade Desk, Roku, Interpublic, Dentsu 4Q24 Trends, CPG Deep-Dives+ Ads101 on Performance Marketing
Madison and Wall: Saturday Summary for February 8, 2025
Each week on the M&W Podcast, we discuss Madison & Wall’s latest research. Last week we introduced our Advertising 101 series, a multi-part (i.e. every week all year long) tutorial that will explain how the industry really works and why money flows as it does.
The series continues with part 6 on Episode 22 with Andy Rosenberg to talk about performance marketing vs. brand marketing (and the intersection of the two). This follows on part 1 with Gerry D'Angelo where we discussed how marketers organize themselves, part 2 with Francisco Escobar on the role of marketing procurement , part 3 with Deborah Wahl on the choices marketers make in allocating their resources, part 4 with Gordon Ho on the differences between large, medium and small marketers, and part 5 with Ari Osur on the differences between B2C and B2B marketing. It’s now available on Spotify, Apple, or wherever you get your podcasts.
We have also recently launched the Agency Business podcast focused on the business of agencies in collaboration with Olivia Morley’s FusionFront Media. New episodes are available Mondays. In our most recent episode, we are joined by QRY’s CEO Samir Balwani to talk about QRY’s independent performance agency.
For more current alerts on this podcast and to see our well-informed hot-takes on agency news of the week, sign up to our free Agency Business companion Substack publication here.
Weekly work
The Trade Desk reported its 4Q24 results this week, and a failure to meet its own and Wall Street’s expectations resulted in a major dive in the stock. As we explored in two separate notes here and here, the results may be less about The Trade Desk underperforming and more about new competition (from Yahoo in particular) and a saturated domestic open internet market were important factors.
Roku reported its results as well, and we contrasted their ongoing advertising growth with those of traditional sellers of TV advertising (illustrated this past week by France’s TF1 and M6 as well as Australia’s Seven West).
Both of Interpublic and Dentsu reported their results for the quarter, and we provided our analysis on both companies. At IPG the business was impacted by key client losses, while Dentsu’s challenges appear to be more structural in nature. The company is evidently still optimistic – perhaps willfully-so - about its own future given the goals it has set for itself for over the next few years
We heard and wrote more about comments from large marketers’ CEOs and CFOs including those at Coca-Cola, Ford, Kering, Kraft-Heinz, McDonald’s, Nestle and Unilever. Growth trends appear to be in place for most of this week’s reporting ocmpanies, although Ford’s CEO offered an appropriate warning about the likely damage to the US auto sector – and thus to its advertising – that will follow in the event of the imposition of proposed tariffs on Mexico and Canada.
More Context
As part of an experiment to assess interest in a broader range of offerings, Madison and Wall is trialing deeper dives into several of the most important consumer-focused industries to existing subscribers.
Below is a review of recent (4Q24) trends in the health and personal care (HPC) sub-category of the CPG industry. Subscribers with full access to our research can read more details about our assessment of current business trends at P&G, Colgate-Palmolive, Estee Lauder, L’Oreal and e.l.f. Beauty.
Within that context, our top take-aways on recent trends for HPC companies include the following:
Every year since 2019 has seen significant macro shocks to the HPC sub-sector. 2025 will have its hits, including tariff risks, overseas market challenges (notably China, whose economy is facing a slowdown), and a persistently stretched less-affluent consumer in the U.S., while the affluent continue to spend, but they are more discriminating.
We believe sales volume growth is the most critical metric for the sector’s long-term health. Some companies are faring better than others on this dimension. Looking at recent trends on this topic, P&G earned its volume growth through innovation. Colgate “bought” its through merchandise and price actions.
Pricing power is also important for companies within the sector, and remains relatively weak. Aside from inflationary foreign exchange offsets for American companies, pricing remains neutral to negative, save where there is strong innovation. Limited pricing power has contributed to limited profit and free cash flow growth for the sector.
As in 2024, the balance of power remains in retailers’ hands for 2025, especially Walmart and the club channel. HPC businesses will have an easier go of it than branded packaged food, which is still losing a lot of share-of-stomach to private label and the value channel (including Aldi, Walmart, etc.).