Roy Spence Takes a Stroll; 200 Told to Take a Hike

GSD&M Chief's Trek Around the Country Came as Agency Lost Client Losses Cut Staff

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For the past year, Elizabeth McCurry, a 26-year-old media planner at GSD&M's Idea City, has been worrying. Client after client has been leaving the Austin, Texas, shop, and large-scale layoffs, unheard of throughout its history, seemed imminent. Last week, they came. Among as many as 200 people out of a job was Ms. McCurry, who blogged about it with equal parts sadness and relief -- relief that the spirit-crushing wait was over: "For the past year, we as an agency have lived in a treacherous time filled with fear of the future. Employees, especially in the media department, became different, and I became different."
As his agency was faltering, Roy Spence was tracking a cross-country journey on his website.
As his agency was faltering, Roy Spence was tracking a cross-country journey on his website.

While Ms. McCurry was worrying, Roy Spence was walking. As things have gone to hell in Austin, the co-founder and CEO has spent not insignificant periods of time trekking in places such as Canaan, N.H., Millbrook, N.Y., and Lackawaxen, Pa. He's walking to "feel America again," part of an intermittent ramble across the U.S. Like Ms. McCurry, he keeps a blog, but his is filled with anecdotes about small-town cafes and bed and breakfasts and photos of the salt-of-the-earth folk he's encountered.

Doubtless, as he walked, Mr. Spence worried about how to fix an agency that in a year's time has halved its work force in response to losses of clients such as Wal-Mart, Chili's and, most recently, AT&T. But any such concern has been drowned out by the sheer strangeness of a publicity stunt whose timing couldn't be worse and whose true purpose was never really clear.

Letting it out
Of course, frustrations about Mr. Spence's walk across America are just part of the larger furor about the cuts. Layoffs are part and parcel of the ad business -- a grim yet inevitable result of the fact that many agencies depend on just a handful of clients for the majority of their income, clients that are sometimes fickle and prone to change agencies whenever they change chief marketing officers, which is often. But the cuts at GSD&M, by far the largest agency in Austin, have bored a hole in that city's tight-knit ad community. Many of those who were cut have taken to venting on personal blogs and online message boards about the grueling wait to hear news everyone knew was coming, some even calling for support groups dedicated to ex-staffers.

Executives familiar with the company initially pegged the number of staffers let go at up to 200. GSD&M -- which added the Idea City moniker in the midst of its troubles -- last year had nearly 900 employees, according to Advertising Age data. Now the agency, still home to brands including BMW, Southwest Airlines and World Market, is set to reduce its manpower to half of what it was at its peak, having already lost smaller droves of employees during the past few months.

Idea City declined to comment for this story or confirm how many were laid off. In an interview last week, Mr. Spence told Ad Age only that the cuts -- which affect staffers in the agency's Texas headquarters and its Chicago office, plus a number of work-from-home employees -- stemmed largely from AT&T's decision last month to consolidate its estimated $3.4 billion media account at WPP Group's Mediaedge:cia.

Idea City had handled media planning and buying, including digital, for the telecom giant's land-line business. Earlier this year, AT&T shifted lead account responsibilities on the consumer portion of the account from Idea City to Omnicom sibling BBDO (several staffers went with the business).

Not all were convinced, though, that the blow dealt last week was entirely a product of the telecom dropping from the agency roster.

And then there was the way the layoffs were handled, never an easy matter, especially near the holidays. To its credit, Idea City management has promised staffers pay and benefits through the end of January, along with job-placement assistance, career coaches and an onsite job fair. That's more than many employers offer in similar situations. Yet, for many, it wasn't the matter of securing new employment that was frustrating; it was the matter of waiting, waiting and more waiting to hear word from Idea City's management.

Said one post from a person identified as "Intern" on the Austin American-Statesman's message board: "It is nice that they are going to help those laid off get new jobs, but I wouldn't exactly describe the way that they've been handling this situation as 'responsible.'"

Mr. Spence also has his supporters. "The severance package is more than generous, and I do believe that upper management is genuinely concerned. I would rather work for Roy than for some pretentious, big-city ego any day," read a post by a person identified as "J Dub" on the same board.

Lacking direction
At a time when the agency was in need of leadership, many questioned Mr. Spence's much-talked-about walk across America, in which he'd log 20 miles a day in 10-hour stretches. His reasons for doing so are, by any estimation, fuzzy. In the blogs, Mr. Spence wrote that the purpose of embarking on the walk was "to shine a light on good people and good things and good places and good families and good businesses and all the things that are good about this country that somehow get lost in the shuffle of reporting what's bad."

Some interpret the walk as Mr. Spence, a charismatic personality who's close to the Clintons, limbering up for a run at public office. Mr. Spence has denied that, using the line "I'm walking, not running." Others think it's about drawing attention to the agency. Just about everyone agrees that it couldn't have come at a worse time.

"I was surprised at the timing," said one consultant who asked not to be named. "The cultural leader of the agency is choosing now to take a walk, and while he's doing that, they're laying off 200 people."

It will be on Mr. Spence to turn things around fast with a much smaller agency around him. For those now on the job market, it's time for a fresh start.

As Ms. McCurry wrote on her blog, Satiety: "I know in my heart that it is time for me to move on from GSD&M. I love this place with all of my heart, but at the same time, it has killed my spirit."
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