Key Business Losses Force Layoffs at DDB

DDB Worldwide is further restructuring its office here, planning “a fundamental change and more radical reorganization” after 20 people were laid off last week, an executive said.
One of the changes involves chief operating officer John Berg’s formally assuming leadership of the New York office from president Peter Tate, sources said.
The layoffs represented nearly 5 percent of the New York 430 staffers and was anticipated in the aftermath of DDB’s loss of the $300 million Compaq account.
“Obviously, when you lose an important piece of business like that, the agency has to bring
its salary structure in line with revenues,” said one source.
Given its account status, agency officials confirmed that more changes were coming but stressed that no more layoffs were planned.
Other sources said various staffers’ titles would change, including that of Steve Landsberg,
co-chief creative officer with David Nathanson, who is leaving the agency to start his own business.
Bob Scarpelli, who became the first chief creative officer of DDB U.S. since Roy Grace held the title from 1983-1986, has been spending “considerably more time” in New York, a source said.
Nathanson confirmed his departure but stressed it was not related to the recent layoffs or to Scarpelli’s expanded role in the New York creative department. Agency officials declined comment, and Scarpelli could not be reached.
In addition to the Compaq loss, DDB’s New York headquarters this year lost ($25 million) and ($20 million). It also parted ways with longtime client Amana, and business has been slow to replace it.
However, DDB’s most recent wins include ($50 million) and
Plus, DDB is a finalist in the estimated $100 million Computer Associates review and is engaged in a creative shootout with McCann-Erickson for ExxonMobil’s consolidation of its $100 million account.
In December, DDB bested McCann for the $15 million assignment to introduce ExxonMobil, the merged entity of Exxon and Mobil oil companies. McCann had been Exxon’s lead agency.