Shauna Lewis
Jan 30, 2024

Dentsu UK and Ireland to cut 2% of jobs

Campaign understands that the restructuring is not motivated by cost-cutting but is designed to enable Dentsu to hire in the right areas for future growth.

Dentsu is currently restructuring under a
Dentsu is currently restructuring under a "One Dentsu" model

Dentsu is to cut 2% of jobs in the UK and Ireland as part of a proposed restructure, with 4% of roles currently in consultation.

In total, 67 people are set to exit the company.

Campaign understands that the restructure is not motivated by cost-cutting but is designed to enable Dentsu to hire in the right areas for future growth. 

The network has proposed to combine the specialist media effectiveness and data and analytics teams that sit within the constituent parts of its business—such as Merkle and Dentsu’s media arm—to create single capabilities to service the whole business. 

Certain client leadership teams will also be restructured under the proposed plans, but only when the clients want services from more than one of Dentsu’s practices.

The consultation closes at the end of this month and Dentsu hopes to establish the new structure at the end of February.

A Dentsu UK and Ireland spokesperson said: “Our clients’ needs and ways of engaging with partners is changing and, in response, we are further evolving our business to be more adaptive and more effective in how we innovate and deliver outcomes to service their needs, both for now and what’s next.”

The move follows Dentu’s new global structure, named “One Dentsu”, designed to simplify how it services clients across different disciplines. 

Hiroshi Igarashi, Dentsu’s global president and chief executive, called One Dentsu a “cross-service structure” and added that it allowed Dentsu to “integrate capabilities” and organise around clients.

Dentsu renamed its creative, media and CXM “service lines” as “global practices” and appointed presidents for each practice. The restructure led to the departures of UK-based chief operating officer Nnenna Ilomechina and chief technology officer Dominic Shine from the global management team late last year.

The spokesperson said: “As part of our evolution as One Dentsu, we have further integrated our capabilities across the group, making it easier for clients to access the full breadth of our services locally and globally, and as a result, some roles have been affected.”

It follows an ongoing organic revenue dip for Dentsu in 2023, which saw a decline of -1.6% in Q1, -4.7% in Q2 and -6% in Q3.

The Japanese parent company told investors in November: “Continued cost management remains in place for 2023 with measures, such as hiring freezes, lower external spending and reduced travel and entertainment costs.”

The Dentsu spokesperson added: “Our priority in 2024 and beyond remains our clients and our people, ensuring we have the breadth and depth of experience and expertise to best support brands and  business [to] innovate, evolve and grow. We are building on the solid momentum and progress we have made as One Dentsu across the UK, focusing on client outcomes underpinned by great end-to-end experiences."

The network’s rivals, including WPPIPG and S4 Capital, also reported declines in Q3. Publicis Groupe, by comparison, reported 5.3% organic growth in the third quarter and published its 2023 figures yesterday, showing 6.3% in organic growth to €13.1 billion ($14.19 billion).

Source:
Campaign UK

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