Retrenchment, Drama in Leo Burnett, Sydney

By Matt Van Hoven 

Leo Burnett Sydney is a long way from its Chicago roots, and it seems that some internal strife has lead to staff cuts &#151 despite semi-regular announcements that all is well.

Outside the layoffs, folks are said to be leaving on their own, like the Senior Digital Art Director and a Senior Digital Strategist before the holidays. The restructuring apparently started a year ago, purportedly at the hands of CEO Todd Sampson. But Head of Digital Dominique Hind is known as the “axe wielder.”

“It took (Sampson) the best part of the year to secure Dom as head of Digital and they got rid of Rene Leger (previous HoD) in August,” said a source close to the agency.

Drama in the ad biz is not native to the U.S. The spy continues, “Dom is extremely ambitious and is likely to be after Todd’s job longer term.”

The agency lost the McDonald’s account in October. It went to DDB, apparently due to consolidaton of the Aussie and New Zealand work. “They gained new Macquarie Bank direct product and consequently all of Macquarie Bank in December, so no net loss of client.”

So if business is OK, why would the agency need to lay people off? Eh hem, restructure?

“Previous staff meetings were all about how profit is up to 9% on previous year which was -1%…wondering whether this ‘restructure’ part of a devaluing of Leo Burnett Sydney…” said a source.

Hypothesis: Could the management team CEO Todd Sampson, Head of Finance Andrew Lovell, ECD Andy DiLallo, ECD Jay Benjamin, Head of Digital and Head of Direct Marketing Josh Grace (with the help of another financial backer) buy the agency from Publicis?

“Publicis will merge Publicis Mojo and Leo Burnett Sydney (LB is moving to Walsh Bay next door to Publicis Mojo in April). (With an) artificial boost to bottom line by reducing wage costs,” they could hypothetically get the shop for less.

Buy low, sell high as they say. Typically, buying an agency from a parent is too hard &#151 but when stock prices are at their lowest and investors are looking to sell…the math gets a lot easier.

More: “Leo Burnett Settles with U.S. Army in ‘Whistleblower’ Suit