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We all know that agencies lay off staff when they lose a big account but it’s highly unusual to chop ten per cent of the workforce when one comes up for pitch.
But that’s what one-time MDC Partners agency Crispin Porter + Bogusky is doing in advance of Microsoft’s global ad review. Microsoft announced earlier this week that it was reviewing all of its global ad business, including media – a $1.3bn pot.
The review isn’t the only reason for the CP+B lay-offs: late last year it lost Arby’s which had gome some way towards replacing Burger King, its long-time biggest account. The agency also says that Microsoft switched to a roster agency system, with each agency having to compete for campaigns as they came up. So no big annual fees.
Presumably this won’t be the case when it switches, as it says it plans to, to a holding company operation although it may envisage different agencies in such groups going up against each other. It has so far invited Interpublic, Publicis Groupe and WPP top pitch, so maybe MDC/CP+B has lost the account already. But you might have expected CP+B, which currently works on Xbox but which has handled the mainstream Windows business in the past, to have hung in there a bit longer.
Anyway, a ten per cent cut it is with the bulk of the exits expected to fall on its Boulder HQ and Miami offices. The agency currently employs about 750 people in the US and Europe.
It has also recently lightened the payroll with the exits of CCO Rob Reilly (who went to McCann), his wife Laura Bowles, a managing director, and COO Eric Lear. CEO Andrew Keller is still hanging in there but we don’t know for how long.
It’s pretty clear that the agency has not recovered its mojo since founder creative Alex Bogusky (pictured) left a few years ago.
