MediaVest Cuts Staff 4%, Claims "Reorganization"
Publicis Groupe's MediaVest laid off 30 staffers this week or 4% of its workforce, the agency has confirmed.
Internally, the reduction is being described as a "reorganization" that has more to do with better aligning staff talents and capabilities with client needs rather than a reflection of the agency's financial performance.
The agency issued the following statement about the staff cutback: "MediaVest routinely evaluates all facets of its business across capability, approaches, product, and staffing to evolve ahead of the pace of change, drive growth, and deliver on clients' short- and long-term goals."
"Guided by these points of focus," the statement continued, MediaVest is restructuring and realigning talent, including a 4% reduction of effective positions."
One source indicated the shop is up this year in revenue as a result of its Microsoft win and organic growth coming from Wal-Mart, Sam's Club and other clients. The agency also avoided some potentially big trouble by successfully defending its piece of Comcast business.
While 30 staffers were let go, no hiring freeze is being imposed and new positions will be added as needed, per sources. An agency source said that by the end of the year, it's likely that the 2011 staff count will be roughly flat versus the previous year.
All the holding companies are keeping a wary eye on the economy, which continues to stagger and stumble its way to a full recovery, which some forecasts now say will not happen until 2014.
At the Goldman Sachs Communacopia Conference in New York this week, several holding company chiefs expressed concern about the advertising economy going forward -- although clients are not cutting back, so far, on spending budgets.
"The watchword is caution," WPP CEO Sir Martin Sorrell told a crowd of investors and analysts at the conference Wednesday afternoon.
"I have to be honest -- we all feel nervous," Sorrell said, of both himself and his senior management team. Sorrell noted that WPP will be starting its 2012 budget process soon, with an eye toward keeping expenses flat next year.
At the same conference a day later, Interpublic Group CEO Michael Roth echoed those concerns. "There is uncertainty, so you have to be concerned," Roth told attendees.
For IPG, that concern translates to paying strict attention to costs and head count. Employees account for about 62% of company costs, and Roth said he wants that figure reduced to 60% "or better."
Also speaking at the conference, Miles Nadal, CEO of MDC Partners, acknowledged that "there is an element of apprehension" among clients as to how the current economic turmoil both in the U.S. and abroad will play out.