Media Insider: DDB Aotearoa advertising agency brand to be scrapped – job losses pending under global merger

One of New Zealand’s best-known advertising agencies – responsible for some of our most popular commercials – is being scrapped, with likely redundancies over the coming weeks, say industry insiders.

The DDB Aotearoa creative agency brand is being retired, with staff in the agency coming together with FCB to form McCann Group NZ.

The changes – announced to staff at a meeting at 9am on Tuesday and later confirmed in a press statement – follow the merger of global holding companies Omnicom (OMG) and Interpublic (IPG).

A raft of agencies – including DDB, FCB, PHD, OMD, Colenso, Clemenger, TBWA, Hearts & Science, Dynamo and Initiative – fall under the newly merged global company, which will be called Omnicom.

But immediate attention falls on DDB and FCB.

DDB Aotearoa staff were left gutted after today’s meeting, said one source, describing the agency as a magical brand. They said DDB had about 220 staff and FCB around another 100.

Dozens of job losses were feared, although the press statement did not broach that subject.

Another source had a more positive outlook, saying the DDB agency was being reskinned as McCann.

“That would be great news for the talented people in that building. Although obviously really disappointing to lose the heritage of the DDB brand.”

Omnicom said DDB Group Aotearoa chief executive Priya Patel and FCB Group Aotearoa chief executive Paul Wilson had been appointed co-CEOs of McCann Group NZ.

In Wellington, Clemenger Wellington and FCB Wellington would rebrand as McCann Wellington, operating as part of McCann Group NZ. Local leadership would be announced shortly.

Omnicom (OMC) has been approached for further comment.

DDB has struggled internationally, but it has been a powerhouse locally – responsible for some of our biggest and best-known advertising campaigns, including creative work for McDonald’s, Vogel’s, Samsung and ANZ.

It also created Lotto’s Powerball ad, featuring a naked skier – one of this year’s most-complained-about commercials.

DDB Aotearoa has unleashed on the world some of New Zealand’s most talented creative directors.

“This is a defining moment for our region. By bringing together the depth, ambition and talent of our people, while simplifying the architecture, we are creating modern, future-fit agencies and capabilities that will deliver world-class creativity and media, smarter data and technology integration, and new levels of effectiveness for brands in Australia and New Zealand,” said Omnicom Oceania chief executive Nick Garrett.

“These changes honour the legacies of our heritage brands while positioning us to unlock even greater opportunity, effectiveness and growth for our clients and our people.”

In a LinkedIn post today, the Independent Media Agencies of NZ organisation said the effects of the OMG-IPG merger “will soon ripple through both organisations, bringing disruption to culture, people, and their clients”.

“This destabilisation will inevitably raise questions for brands about whether their needs are still being prioritised.

“For those impacted, we empathise, but there is a better path forward. Now is the perfect moment to consider shifting to an independent media agency, where agility, partnership, and client-centred thinking lead.”

UK marketing and advertising website The Drum confirmed the broader global changes. “Today is the day where the structure, strategy and leadership of the new Omnicom starts to come into view, including confirmation of the worst-kept secret in advertising: storied agency brands FCB and DDB are among those to be sunsetted as part of consolidation efforts, with more job losses to come.”

The OMG-IPG merger (the new company retains the name Omnicom but with the initials OMC) has formed the world’s biggest advertising holding company, surpassing Publicis and WPP.

OMC has made no secret of the estimated cost savings – up to NZ$1.22 billion globally – including reduced roles.

There have already been various high-profile changes and departures at some of the local agencies in recent weeks.

Trade website produ.com earlier reported that the OMG-IPG merger included a “historic” decision – “the dissolution of the DDB network, one of the most influential brands in the history of modern creative advertising”.

It said the US Federal Trade Commission (FTC) had approved the merger around three core global agencies: BBDO Worldwide, McCann and TBWA\Worldwide.

“This integration will directly impact regional operations, leadership structures, and the brand identity of several historic agencies across the globe.”

Omnicom chairman and chief executive John Wren last week called the merger a “defining moment for our company and our industry”.

“With the completion of the deal, Omnicom is setting a new standard for modern marketing and sales leadership – creating stronger brands, delivering superior business outcomes, and driving sustainable growth. We’re excited about this next chapter. I want to thank our people, clients, and shareholders for the trust they have placed in us.”

Editor-at-Large Shayne Currie is one of New Zealand’s most experienced senior journalists and media leaders. He has held executive and senior editorial roles at NZME including Managing Editor, NZ Herald Editor and Herald on Sunday Editor and has a small shareholding in NZME.