by Herman Manson (@marklives) Y&R South Africa is closing down its Cape Town office. This follows the news that Graham Lang, CCO of Y&R SA and Africa, is leaving the agency at the end of November 2017. Yossi Schwartz, group chairman of Y&R Africa, previously announced he would also do so, effective this September.
The agency suffered a major blow in 2016 when Pick n Pay moved its account to King James, ending a relationship that lasted 48 years. Now Y&R SA is consolidating efforts around its Johannesburg agency, which employs 80 plus people. Key clients in Johannesburg include Edgars, Amstel and Colgate.
Jason Xenopoulos, CEO of NATIVE VML and Y&R South Africa, says consolidating the agency’s focus and efforts around Joburg makes business sense. It already houses its major clients, and its best growth prospects. According to him, the group tried to make the Cape Town office work but the market has remained small and the office hasn’t regained viability after PnP.
Servicing of Cape Town’s major remaining client, SKYY Vodka, has already been moved to Joburg. Russian Bear is being temporarily serviced out of there as well while it decides if it wants to move. Chevron is about to go out to pitch as it looks for a Level 1 BBBEE agency partner.
The decision to close down Cape Town affects 6–8 permanent staff members, most of whom are leaving the agency. Some posts in the Jozi office are available but requires relocation.
According to Xenopoulos, the Durban office has also been closed and all Durban clients are being serviced out of Jozi.
The agency would consider reopening in Cape Town if a major client required servicing out of the city but, for now, it has moved away from a multi-city strategy in a bid to save on overheads and logistics costs. A new leadership team will be announced for the Joburg agency in the near future.
Herman Manson (@marklives) is the founder and editor of MarkLives.com.