>Restructuring highlights growing competition and confusion in B.C.’s advertising marketplace
By Glen Korstrom
Tough times in the advertising industry have forced one of Vancouver’s largest ad agencies to file for creditor protection, rebrand and consider merging with a well-financed digital marketing company.
TBWAVancouver renamed itself Trees and Rocks on March 22 and, at press time, was seeking creditor approval for the merger with the unnamed local company.
“We might be changing the name again,” president Andrea Southcott told Business in Vancouver. “Everything is open for discussion.”
Southcott’s company owes a combined $5.4 million to 105 creditors, including:
- Global BC ($1.15 million);
- CTV Television Inc. ($825,395); and
- Rogers Media Inc. ($478,469).
Southcott is owed $50,000, according to a list of creditors that trustee KPMG Inc. released February 21, when Southcott’s firm filed a notice of intention to make a proposal to creditors.
Documents also show that Trees and Rocks has more than $3.8 million in assets to settle liabilities.
“The point of this process is to make sure that we’re giving the full value that we can to our creditors and to make sure that we can protect our staff,” said Southcott.
Southcott’s agency has been near the top of Business in Vancouver’s list of the largest ad agencies in Metro Vancouver since at least December 2000, when she was named the company’s president and COO and became the first woman to lead a major advertising company in Vancouver.
Southcott’s company had been known as Bryant, Fulton & Shee Advertising Inc., but when it was sold in 2000 to what is now conglomerate Omnicom Group Inc. (NYSE:OMC), it was rechristened TBWAVancouver.
Omnicom manages the TBWA brand and other global advertising agency networks such as BBDO and DDB.
Trees and Rocks’ 35 staff helped it hang onto fifth spot on BIV’s 2011 list of the largest ad agencies in Vancouver (see “Biggest ad agencies in Metro Vancouver” – issue 1116; March 25-21).
Southcott, however, said March 28 that some staff lost jobs when she eliminated her company’s media buying operation.
She declined to provide a current staff count or elaborate on details involved in the restructuring “[because] I wouldn’t want things to get mischaracterized in the interim, which could end up being to the detriment of staff and creditors.”
Other large Vancouver ad agencies, such as Rethink Communications Inc., similarly do not have media buying operations, which place ads for clients.
That leaves Wasserman & Partners Advertising as the largest independent full-service agency in town. It does everything from creative work for both digital and traditional media to planning where to place those ads and then placing them.
“We’re picking up clients,” said principal Alvin Wasserman, who listed former Trees and Rocks client Vancity and former Publicis Vancouver client Granville Island Brewing as some new pickups.
Publicis closed its Vancouver office last year, but still has offices in Toronto and Montreal.
“The multinational ad agencies – except for big guys, like Cossette [West] or DDB [Canada] – they are all having a rough time because they don’t have a position. They don’t have a relevancy. Unless they’re big and strong and can say, ‘We can use our network,’ they just seem to be nubs of agencies, and they don’t have a commanding or a convincing position.”
Wasserman mused that TBWAVancouver’s new name could be an effective way to convey local roots – something Southcott said is the intention.
Exhibit A: Design Group principal Cory Ripley recently rebranded the Pemberton Golf and Country Club as the Meadows at Pemberton and has created brands for startups such as Parade Baby Organics, Sapadilla Soap Co. and Jack and Lily Baby Shoes.
“[Trees and Rocks] doesn’t sound like a traditional ad agency name, and that is potentially a good thing because it will get people talking,” Ripley said. “People may be confused and want to know what the story is. That’s potentially a great thing, because so many companies start up today and no one is intrigued [by their name.]”
New York, NY
CEO: John Wren
Employees: N/A
Market cap: $13.93b
P/E ratio: 18.10
EPS: $2.70
Sources: Stockwatch, NYSE globe investor