Host/Havas makes redundancies after losing Defence recruiting account
Advertising agency Host/Havas has made a large number of redundancies following the loss of its biggest account, Australian Defence Force Recruiting, Mumbrella understands. Mumbrella has heard industry speculation that the number of affected staff could be upwards of 70, but so far, Host/Havas has declined to comment or confirm the number.
The Department of Defence started the tender process of seeking a pitch consultant in late 2017. In April last year, the DFR then rolled over its current contract with Host/Havas for an additional year.
Mumbrella understands the winner of the DFR digital and creative contract has not yet been notified
Host/Havas’ contract with the DFR is expected to end at the end of March.
Mumbrella understands Host/Havas has since learned it will not be retaining the account for the DFR, and, as a result, the agency has had to make the redundancies.
Mumbrella understands four agencies made the final shortlist, including VMLY&R, TBWA Melbourne, Host/Havas and Clemenger BBDO Sydney.
In 2013 it was announced that Havas Worldwide Sydney had won the account for a three-year period, with the option to roll over the contract for an additional year.
Host/Havas declined to comment.
A spokesperson from the Department of Defence said: “The successful CADS provider will have responsibility for delivering Defence Force Recruiting’s attraction requirements, which includes the development of advertising materials for television, cinema, magazines and newspapers, and digital advertising, as well as other content for the Defence Jobs website and for use in various social media channels.
“The tender process is still underway. Details of any contract awarded will be published on AusTender at www.tenders.gov.au after the contract has been executed.”
Host/Havas’ clients include the National Heart Foundation, Oroton, Air New Zealand and Chatime.
UPDATE 15/1/19:
Laura Aldington, CEO at Host/Havas, said in a statement to Mumbrella: “Whilst this is obviously a disappointing outcome for us, we wish the Defence Force Recruiting team all the best.
“I want to thank the incredibly talented, dedicated team at Host/Havas, who helped deliver DFR the two most successful years in their history, guiding them through a period of significant digital transformation.
“They should feel justly proud of the last five years and the amazing contribution they have made, in particular the recent awarding of the Australian Grand Effie.
“Our first priority now is obviously our staff, and out of respect for them, we will not be disclosing any specific details on changes we are making as a result of this news. We can confirm that there will be a number of redundancies and the leadership team has now met with every single member of the agency and informed them of the impact on their individual roles.
“While we confirm there will be a number of redundancies, the number being speculated is incorrect.
“They have all, without exception, behaved with absolute grace and class and we couldn’t be prouder of them for that. We would also like to thank our amazing clients for all of their support over the last few days and all of our friends and partners in the industry for theirs. We will now take some time to recalibrate, adjust and set ourselves up to continue delivering great work for our clients in 2019 and beyond.”
Abigail Dawson was Mumbrella's senior content journalist covering event content. She left Mumbrella to move into an agency role in 2020.
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Who won though? And how cheap did they go?
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Shame.
it seems creating the most effective long term campaign in Australia isn’t good enough for some clients.
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Agreed Nick, there seems to be some very dubious decisions made when it comes to Government accounts.
Grey losing TAC also springs to mind.
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That’s true, Nick. Except the same could’ve been said about GPY&R at the time who were undercut by H/H low balling it by a significant margin, effectively buying the account.
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Did that other wpp agency forget to submit its tender again?
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Some very good people were cut from the ranks. Agencies be on the look out.
Congrats to whoever won AD
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Congrats dude!
I hear you Julian and Matt wrote the majority of the submission.
Y&R owe you guys a bonus
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How much is this account worth to chop 70 people??? It can’t be worth $70 million.
When we lost Woolies we lost less than half the amount of people. So says they have lost far more than just one account.
Sorry to those who lost their jobs especially those over 40…you battle to find something else in this horribly ageist industry.
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Sad for Havas. Great people. But congrats to who ever won the gig
A tough client. Will take all their skills.
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This isn’t even remotely accurate.
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Exactly Captain – Losing an account like this is a sad blow for any agency- but this stinks of either mis-management of the business or terrible management of people.
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Presumably Freedman has gone, I mean how many failed agencies can you preside over before getting the proverbial guillotine?!?
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Considering you were one of the key people Havas would have lost to, is it really appropriate to comment?
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A certain recent merger might very well have worked greatly in favour for CADS…
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“Host/Havas’ clients include the National Heart Foundation, Oroton, Air New Zealand and Chatime.”
Don’t Havas have Reckitt Benckiser anymore? Wouldn’t that be bigger than the likes of Oroton and Chatime?
If that’s really all the significant clients they have left, god help them
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How can Defence appoint an agency that has nobody left there? Of those that pitched barely two of them remain.
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Good point, losing over 70 people for one account is a bit too much. Would it be a combination of factors? Sad to see anyway, tough business!
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Is it common in agencies to have such a massive layoff because your business runs mostly off one client? Sounds like the system is seriously problematic. Obviously (at the very least) someone from the leadership team at HH is out, good luck to whoever that is.
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They published figures earlier this month. Apparently they spent almost $13M with Host/Havas alone.
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Which would account for 13 redundancies, at the average of $1M per employee. In other words, they’ve lost more than DFR.
And/or are using the opp to be cheap and save $.
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Correct – the end is nigh.
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$1m per employee is way off the mark.
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You would have to be charged at $500 an hour five days a week for 52 weeks a year to generate $1M in hours. And that’s not taking into account public holidays, leave and, the biggest one, salary.
Given that most staff on an account are charged at well under that you can see why they had to lay off a much larger number of staff than 13 for a $13M account.
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Sounds like the result of complete mismanagement from senior leaders at H/H.
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