Agencies laying off staff, restructuring operations


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“There is a little bit of a shift in the marketing mix,” Hendra said. “The mix is more toward the variable project side of the work versus fixed-in-place marketing plans. This is linked to client CFOs operating on a quarter-to-quarter basis and funding [marketing in] a different way.” Mike O'Toole, president of PJA Advertising+Marketing, Cambridge, Mass., also noted that the budget planning process has changed as clients tighten their reins. “Clients are saying they are looking very closely at the next quarter, and they want to evaluate their media spend,” he said. “We have been in some conversations in which clients were planning to launch a campaign but are either pulling it, reducing it or subjecting it to new scrutiny.” PJA's clients include Boston Scientific, Novell Networks and Trend Micro. O'Toole said the nature of the agency's work is changing as well. “There are not as many big, integrated campaigns,” he said. “The projects tend to be smaller and more focused. Clients are saying, "In a tough economy, we want to make sure we have the right go-to-market message and be distinctive and clear before we invest any scarce dollars on promoting a product or service.' ” Hendra said clients have higher expectations of their agency partners in these tough times. “Clients are looking for greater value from their agencies and [for] premium creativity,” she said. “Clients will pay almost any price if it's working for their brands.” To address these needs, Ogilvy is restructuring its operations to foster more transparent work processes and moving into a new Manhattan building with an open floor plan. It is also developing automated tools and technologies to deliver marketing programs at lower cost and greater speed, Hendra said.
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