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TBWA\ feels the ASB disruption

June 30th, 2010 by Ben Fahy

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If you believe the company mantra, TBWA\ is all about ‘disruption’. And there’s been plenty of that in Mayoral Drive lately (although not of the creative kind it likes), after ASB decided to end its 12 year relationship and shack up with Droga5 last week.

TBWA\chief executive Dave Walden has said in the past that working in advertising is basically a form of danger money: if big accounts are lost, so are jobs, but employees are paid well to make up for the lack of certainty. And while he says there will be some “natural attrition” with ASB departing, he says information passed on to StopPress today about 20 employees being, or likely to be, let go, is complete rubbish.

“We’ve got three months until Droga5 take over, so we’re keeping the team together and running things professionally until the business shifts. There’s not going to be any blood on the floor here this week. We’re certainly not rushing off to hire people, but it’s natural attrition”.

He also told the NBR there wouldn’t be anything major in terms of job losses “like the 10 or 12 people Saatchis got rid of in one hit”.

Walden is remaining philosophical about the loss, but admits it does feel like his “wife has run away with someone else”. Still, he says he’s a glass half full kind of guy and, while it might be a stretch, being cut loose could be something of a mixed blessing: ASB was such a dominant client (TBWA\ wouldn’t say how much the account made up in terms of a percentage of total billings and denied a rumour that ASB paid a monthly fee of $180,000), it was almost as if the agency had to work around it.

“So now we’re looking at how we rejig the agency to see if we have the right model going forward for the existing clients.”

Despite the kerfuffle over the ‘We’re a Kiwi Bank’ campaign, Walden doesn’t think there was anything in particular that pushed ASB away, aside perhaps from a case of familiarity breeding a little contempt. He has no knowledge of how Droga5 approached the pitch and what swung the vote, but he says there have been a raft of changes at the bank recently, with Charles Pink taking over as chief executive, a restructuring of management and a shift in the way the marketing department operates. As such, after 12 years together, he says they were on “a hiding to nothing” and there was simply “a mood for change there”.

The handover for a big, complicated account like this requires a lot of work, so there will be some crossover between the two agencies. He believes Droga5 will be in charge of the relaunch of the brand and says the briefs will probably start drying up for TBWA\ when it gets closer to cut off time in three months.

“At the moment, though, it’s pretty much business as usual”.

Of course, Walden has been through all this before a number of times. It’s just part of the cyclical advertising game and he says the celebrations that follow a win usually balance the disappointment of a loss. Even so, ASB is a very big loss (with $12 million spent in 2008 it was number 37 on Nielsen’s top 200 advertisers list), and there are also some interesting side stories to it.

Firstly, there’s the well-known tale of Deborah Simpson, who decided to go client side last year after working on the ASB account with TBWA\; secondly, TBWA\’s recent win of The Starship Foundation account, a charity gig that requires quite a lot of free work (and one that some think was an effort to butter up big Starship supporters ASB before the pitch) could now come back to bite them; and thirdly, there’s not too much love lost between Walden and Stone.

Of course, Walden isn’t renowned for holding back, but he’s being very well-behaved at the moment and refrained from commenting on the juicy bits (Stone, Droga5 or ASB).

“There are always winners and losers in a contest. But I like winning better than I like losing.”

Of course, loose lips sink ships – and, in this case, loose lips could affect TBWA\’s chances of adding another bank to its roster in the future. But even with a well-behaved Devo, that could be difficult: BNZ, ANZ, Westpac and TSB have changed agencies recently, so there aren’t too many left.

He says the ‘projectivisation’ of the advertising business (a la Air New Zealand and its use of different agencies and Westpac, which has split its account in half and shared it between Saatchi’s and .99) could happen more with the banks, but in his experience, banks tend to like to have one point of control. And, while he says you don’t find them jumping into bed with someone else so soon after changing agencies, he says the halcyon Goldstein years and ASB’s performance during its tenure have given TBWA a very good financial heritage to talk up, so he’s optimistic new work will arise eventually (speaking of Goldstein, Walden says “you’ll have to ask ASB about that”).

Of course, while there is plenty of chatter around the traps about how the loss will affect TBWA\, there’s also plenty of talk about the ‘Drogans’, whether the new business model Stone is trumpeting is just a case of the emperor’s new clothes and how the two rather traditional big agency protagonists, Andrew Stone and Mike O’Sullivan, are leading the apparent revolution.

As many have pointed out, it’s quite ironic that after claiming the big agency model is on its last legs and that Droga5 has a new way of doing business, the first major client it gets is a big, traditional bank (Droga5 may also have landed some Air New Zealand work, but Stone isn’t talking about his clients and an Air New Zealand spokeshuman could not be reached to confirm it).

Not long ago, the digital agency evangelists said big, traditional agencies were dying. The internet proponents claimed print wouldn’t survive. Social media will rule the world, they say. And remember the dotcom era? Basically, people are always pushing their own barrows: some, in the Droga5 style, are saying the full-service agency is on the way out and that it’s all about projects, possibly so they can nab some of those projects in their formative days. But some smaller agencies actually want big agencies to prosper, both so they can then work with smaller clients that are profitable to them and so that creativity continues to be valued by the big clients.

Maybe there are changes blowing in the wind. But on the face of it, the big agencies like DDB, DraftFCB and Colenso are still doing very well. Saatchi’s not so much, but some say that’s the legacy of the past management. And the new team has, wisely in the opinion of most, shaken things up, got the broom out and pretty much started afresh in an attempt to get the cycle going back in the right direction.

Change will always be there. But, if history is a guide, revolutions aren’t.

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Tags: Andrew Stone, ASB, Dave Walden, Droga5, TBWA