UBS UBS Group AG

Ad giant WPP is spending about $70 million with Snapchat on behalf of clients, said WPP's chief executive, Martin Sorrell, at the UBS Media and Communications Conference on Tuesday.

The ad revenue is significant for Snapchat parent Snap Inc., which is preparing for its initial public offering. Still, it's only a fraction of the amount that WPP spends with more established players, including Facebook, Google and traditional media owners.

WPP in late August said it continued to boost spending with Facebook and Google, largely due to an increase in spending on mobile search. The company this year expects to spend about $5.5 billion with Google, compared with $4 billion last year, and $1.7 billion with Facebook, compared with $1 billion last year, said Mr. Sorrell at the time. Facebook could be the second

Mr. Sorrell at the UBS conference said that WPP will continue to increase its spending with Facebook, which has been "trying to undermine Snapchat."

"Clearly there is some concern [by Facebook] about the penetration Snapchat is getting," he said.

WPP is among the ad companies attracted to Snapchat's young following, but Facebook shouldn't feel too threatened yet. Snapchat is an even smaller piece of WPP's ad-spending pie when traditional media is factored in.

"Traditional media owners themselves could put together an effective third force to counter the duopoly of Google and Facebook," said Mr. Sorrell.

WPP spends $750 million to $1.75 billion with a number of individual traditional media companies, and $2.2 billion alone with News Corp, which owns The Wall Street Journal.

WPP owns GroupM, which is the biggest network of ad buying agencies in the world.

Write to Alexandra Bruell at alexandra.bruell@wsj.com

(END) Dow Jones Newswires

December 06, 2016 17:55 ET (22:55 GMT)

UBS (NYSE:UBS)
Historical Stock Chart
From Mar 2024 to Apr 2024

UBS (NYSE:UBS)
Historical Stock Chart
From Apr 2023 to Apr 2024