Post-production house boss: We’re going to stop chasing advertising work at any cost

zareh nalbandian

Nalbandian: Industry is destroying itself

One of Australia’s  best known post-production companies is to change its strategy for the “over serviced” advertising sector.

Zareh Nalbandian, CEO of Animal Logic, which last year acquired the assets of fellow independent post house Fuel, told Mumbrella that Fuel was re-examining its commercial strategy and would be less likely to chase low margin advertising work.

Nalbandian told Mumbrella: “I do feel like the advertising post production business is over-serviced and competitive to the point of destroying itself. It’s the nature of the business worldwide but particularly in Australia. It’s become par for the course but it’s not the way to retain talent.”

“We want to maintain the highest standards which both Fuel and Animal Logic have been known for. We’ll be aggressive in the business as you have to be but not to the point where we’ll self-destruct. We’re not going to do something that kills us but we will be aggressive and we will be competitive.”

Previously Animal Logic and Fuel both competed in the ad market. In the acquisition of Fuel, all commercial and short-form work previously done by Animal Logic moved across to Fuel. Animal Logic moved towards animation, with both companies continuing to work on feature film VFX.

Nalbandian declined to give further detail about the new strategy, however, added: “We have combined incredible strength and we now want to apply those to the right creative and production partners but the strategy is a work in progress.”

The CEO said the nature of the advertising production business puts post production houses at the bottom rung of the ladder.

His comments come the same week that VFX artis Roger Bolton accused the ad industry of treating production houses like “scum”. Nalbandian said: “I’m not going to point the finger. It’s not one offender.”

Nalbandian founded Animal Logic based on advertising work.

Colin Delaney

Comments


  1. John Smith
    5 Feb 13
    12:13 pm

  2. Why is there a 2007 interview with this story?

  3. mumbrella
    5 Feb 13
    12:45 pm

  4. Hi John Smith,

    When it’s relevant to drop in a background video then we do so. In this case, it’s a YouTube video of Zareh talking about the early days of Animal Logic.

    Cheers,

    Tim – Mumbrella

  5. overpaid creative director
    5 Feb 13
    1:03 pm

  6. and THAT’S how you handle a post-production business in a smart and professional way, Mr Bolton.

  7. Anonymous
    5 Feb 13
    1:49 pm

  8. Everyone should have a read through this blog:

    http://www.campaignbrief.com/2.....212;a.html

  9. Tony Simms
    5 Feb 13
    1:57 pm

  10. I heard of an instance where last week a senior marketing person assembled the agencies for a meeting and took them through the sales results (or lack thereof) of the last 6 months.

    The request was made for each agency to work with them to “create value”
    The essence of the request was simply to do more for a lot less. These agencies all find themselves taking on work for little or no margin and having to carry costs for 60 or 90 days seemingly acting as a pseudo finance company for their client.

    To work within these limited budgets, the agencies are dedicating less hours and not surprisingly the client expects the agencies to spend the same number of hours and complains bitterly about service levels and attention to detail dropping.

    It is soul destroying for both agencies, suppliers and their teams to continue to work in this manner but the request to do so coupled with expectations of agency performance are a total disconnect.

    Perhaps the rampant discounting to secure work from clients in a tough climate has come back to bite agencies and their suppliers on the bum!

  11. NS
    5 Feb 13
    2:20 pm

  12. what a great success story they are

  13. Tom
    5 Feb 13
    2:43 pm

  14. Tony Simms is on the money.
    The margins everywhere are being squeezed out, as we come to the end of debt-fuelled growth.
    It’s happening for most clients, and they’re passing the pain down the line.
    Nor will it be changing any time soon… rather, it’ll likely get worse.

    On this issue, this is time well spent: https://soundcloud.com/abc_rn/satyajit-das-and-the-end-of

  15. Andrew
    5 Feb 13
    3:34 pm

  16. Ummm am I missing something, who carries the cost for 60 to 90 days?
    I think it’s the post production company last time I checked.

  17. ChangeWithTheTimes
    6 Feb 13
    9:52 am

  18. @ Tony Simms and @ Tom, times have and are changing, change with it or get out and stop whining!!

  19. ChangeWithTheTimes
    6 Feb 13
    10:42 am

  20. Just one more thing, Zareh, it seems, was not willing to change his business model to suit the current climate…