Reduced ad spending by marketers as well as industry shutdowns during the coronavirus COVID-19 pandemic continue to negatively affect ad agencies and their staffs. This week, Crispin, Porter and Bogusky’s sister agency under the MDC Partners umbrella, 72andSunny reduced its staff by a little less than 10%.
The award-winning agency went through a series of layoffs last week across its offices in North America. The agency released a statement which AgencySpy obtained:
“Like many other businesses, 72andSunny has felt the impact of the global pandemic. We’ve taken multiple actions to cut costs over the last two months. Unfortunately, today we find ourselves in the difficult position of having to part ways with some of our staff in North America. We’ll do our best to support them and one another throughout this difficult time. We remain committed to supporting our people, partners and broader communities, and remain steadfast in the belief that the power of creativity will continue to drive positive impact in the ever-evolving world.”
The agency had reportedly began implementing other cost-cutting measures including executive salary reductions, suspending 401k matching, reducing some employees to a four-day workweek at reduced pay and furloughing some personnel.
Endeavor Cuts Costs
Holding company Endeavor has also implemented furloughs and layoffs, across its properties, including 160over90, IMG and WME. Approximately a third of the company’s employees are impacted in some capacity by furloughs, layoffs or reduced pay for reduced work according to AgencySpy.
“The long-term prospects for Endeavor remain unchanged, but like other companies, we are taking a variety of actions to mitigate the impact of this pandemic. Since late March, we have been rolling out cost-saving measures in phases across our companies and geographies and intend to complete most of this process in late May,” an Endeavor spokesperson said in a a statement. “Approximately a third of our population will be impacted by reduced pay for reduced work, furlough or position elimination, with the majority affected by reduced work and furlough.”
The majority of those impacted were furloughed, or had pay and/or schedule reductions. Remaining Endeavor employees were also subject to a tiered base salary reduction, with anyone making $65,000 or less not affected, while Endeavor CEO Ari Emanuel and executive chairman Patrick Whitesell suspended their salaries for the year and Endeavor president Mark Shapiro took a 50% reduction in pay, the source added.
These moves exclude UFC, which has a different ownership structure.
McGarrah Jessee Reduces 3% staff
The Austin, Texas independent agency went through a round of staffing reductions in response to the impact of the coronavirus pandemic on client business. The agency had just hired Executive Creative Director Corel Theuma
McGarrah Jessee characterized the reduction as part of a restructuring to align with changing client needs during an “unprecedented time.”
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“We’re fortunate to have strong client relationships—both with our newest clients like Lyft and GameStop as well as in our 15-plus year partnerships with brands like Whataburger and Frost Bank—and that has given us the predictability necessary to absorb the ebb and flow of client scopes while holding on to our talent. As a result, we’ve enjoyed high employee retention and a turnover rate that’s consistently half the industry average,” McGarah Jessee marketing director Heather Snow said in a statement.
“The current situation is unprecedented. We don’t know what lies ahead—nobody does. And we are investing in providing a deeper level of partnership to our clients during this time of need and uncertainty. So we’ve done some restructuring of teams and departments,” she added. “We’ve let some staff go and in other areas we’re bringing on new hires. The net is a 3% reduction.”
Theuma most recently served a short stint as executive creative director at StrawberryFrog. Before that he spent over two years as a group creative director at R/GA, working with brands including Ally Bank, Bubly, Jim Beam, LifeWTR and Verizon.
SOURCE: AgencySpy
