Dentsu Aegis Network confirms salary cuts and furloughs
Dentsu Aegis Network confirmed that it has initiated salary reductions and furloughs across the holding company and its individual agencies, which include 360i, mcgarrybowen, Carat, Isobar and iProspect.
Adweek first reported the news, saying that there were also layoffs that hit certain agencies and that the holding company set benchmarks for the measures that varied among the individual shops.
A Dentsu Aegis Network spokesperson confirmed the salary cuts and furloughs, but not the layoffs. The furloughs, the spokesperson told Ad Age, were implemented "as a means to protect jobs and safeguard livelihoods."
One person close to the matter told Ad Age that the furloughs were put in place for one quarter.
"Since the coronavirus outbreak, Dentsu Aegis Network’s primary priority has been to protect our people, preserve and nurture our client relationships and to support the local economies and communities in which we operate," the Dentsu Aegis Network spokesperson said. "As a result of COVID-19 business impacts, we are activating a set of cost-saving measures across the company to ensure business continuity and to safeguard our people’s livelihoods around the world. We consider our people to be our greatest strength and are doing everything we can to ensure we have a healthy and sustainable business for them and our clients after this crisis passes.”
The cost-cutting plan follows last week's news of Wendy Clark being named global CEO of Dentsu Group's Dentsu Aegis Network. The former global CEO of Omnicom Group's DDB Worldwide will oversee all operations outside of Japan in the role, as well as Dentsu Aegis brands including Merkle, Carat, Isobar and mcgarrybowen.
Confirmation of the cost-cutting comes as layoffs start to hit agencies.
Ad Age learned last week that Interpublic Group of Cos.' MullenLowe cut 10 percent of its U.S. staff. Giant Spoon confirmed that it laid off 20 percent of its staff last month, blaming the negative impact event cancellations have had on its experiential business. And the week before Giant Spoon initiated its cuts, Anomaly laid off 22 employees and said most executives in its New York office took a temporary 10 percent pay cut.