Omnicom's Wren: Chrysler Is "at Risk" and We're Pitching; 5,000 Jobs Lost Since '08
Omnicom chief John Wren appeared to be using his Q3 2009 conference call to pitch rival auto accounts to Chrysler, or at least to alert clients that his agencies — which include BBDO – may be available for work soon. Wren told investors Chrysler was “at risk” and that Omnicom’s agencies were “engaged in a number of other pitches for other auto makers.”
BBDO’s role on the Chrysler account has been thrown into doubt of late. While it is not yet certain that the agency will be unable to renew its contract, many are digging BBDO’s grave even though the agency’s work is still on the air.
On the call, Wren was asked about the auto biz:
CEO John Wren: As has been well-reported, we have our challenges with Chrysler, which for 2009 will contribute about 1% of our revenue, so that I believe is at risk. Having said that, we are also engaged in a number of other pitches for other auto makers and we are fully expecting to win our fair share of those pitches.
Alexia Quadrani - JPMorgan: … With your relationship with Chrysler right now, are you free to participate in the pitches for the domestic auto business that is currently in review?
Wren: The Detroit office of BBDO is still under contract with Chrysler and therefore it’s not available to be pitching other business at the moment. Having said that, we have an extraordinary number of unbelievably talented people who in my business experience are the hardest working people I’ve ever met and so irrespective of what the outcome is on the Chrysler account, I fully expect those people to be employed in the auto sector as we get into 2010.
So we are honoring the contract and we will see what the outcome is and hopefully there aren’t any significant changes but if — but no matter what happens, those people are among the best that are within this company.
So, automakers, you know who to call, especially if you need a large, experienced agency in the Michigan area, mention no names, nudge-nudge, wink-wink!
More seriously, CFO Randall Weisenburger dropped a bombshell regarding the number of jobs lost at the company. It’s 5,000:
Craig Huber - Private Investor: What is your full time equivalent employees at right now? You ended last year about 68,000.
Randall J. Weisenburger: Well, the headcount right now is about 63,000. The headcount gets adjusted based upon scope of work and some of the numbers can move around, depending upon where the work is at. … so that headcount number is not a perfect calculation for I think what you are trying to do. We’ll continue to adjust headcount as needed agency by agency based upon their client revenues.
We are going through those efforts right now, fine-tuning I’ll say the fourth quarter and going forward based upon individual agency changes.
Previously, Omnicom had disclosed only 3,500 jobs lost.
Jim Edwards, a former managing editor of Adweek, has covered drug marketing at Brandweek for four years, and is a former Knight-Bagehot fellow at Columbia University's business and journalism schools. Follow him on Twitter or send him an email.
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