Omnicom Group’s BBDO today said it has cut 189 staffers across its North American operations “in response to some lost client accounts (e.g., Pepsi in the U.S.) and reduced planned levels of activity on some clients.”
That cut, based on Adweek estimates, equals approximately 5 percent of the New York-based agency’s N.A. staff.
The layoffs come amid confirmation that BBDO parent Omnicom is trimming less than 5 percent of its worldwide staff of 70,000. In a statement, an Omnicom rep said: “Given current economic conditions, our companies have reviewed their staffing levels as they relate to their current business requirements. Some, but not all, will have to make adjustments.”
Among other clients cutting back at BBDO is Best Buy, which spends nearly $400 million annually on ads and is expected to use MDC Partners’ Crispin Porter + Bogusky in Miami, also a roster shop, for a greater portion of its ad work next year, per sources.
Last month BBDO, with Chrysler as its largest client, cut 145 employees at its Troy, Mich., office, or 22 percent of the staff at that location. It’s believed that the current round of cuts does not include individuals in that location.
The agency added in a brief statement: “We are making reductions in BBDO offices around the world based on an office-by-office assessment of planned client activity in 2009. There is no overall fixed number or percentage we have established.” The shop employs 16,000 people worldwide.
Pepsi last month shifted lead domestic creative duties from BBDO to Omnicom’s TBWA\Chiat\Day in Playa del Rey, Calif., following a review involving those two client roster shops. Pepsi spends about $100 million annually on U.S. ads, and it had been a flagship client of BBDO’s domestic operations since 1960.
The shift covered mainly Pepsi and Diet Pepsi. Media duties on the brands were not affected by the shift and remain at Omnicom’s OMD in New York.
Also, BBDO continues to handle Pepsi overseas as well as other company brands in the U.S.
Omnicom’s London rival WPP Group, meanwhile, is not commenting on speculation that CEO Martin Sorrell issued a memo calling for cost savings of up to 30 percent at the company’s European agencies. However, after Brand Republic posted that information on its Web site, citing sources, the U.K. news service amended the copy to say that, “WPP said the report was completely untrue.”
This story updates an earlier post with news of the broader Omnicom cuts and additional details.