Is Publicis Canada Toronto bound?
Quebec agency looks outside the province for growth

The balance of power is shifting at Publicis Canada. As recently as 1998, Quebec's second largest agency generated about two-thirds of its $31.7 million revenues from within the province's borders.

But with the hiring of new Toronto-based management talent, and the pick up of some high profile accounts -- notably Microsoft Canada ($30 million in annual billings) and the Canadian Imperial Bank of Commerce ($50 million in annual billings) -- the company's focus is turning west.

"It's not normal that a large firm such as ours be so heavily concentrated in one market (Quebec)," said Serge Rancourt, Publicis Canada's president and COO. "With current growth, next year the company's revenue split will be roughly 50-50 between Quebec and Ontario."

Considering the relative weight of the two economies, Rancourt believes the ideal balance would be one third of revenues derived from within Quebec, and two-thirds from the rest of Canada.

But he strongly denies that his decision to live in Toronto after he was hired as president last May -- with a mandate to triple the agency's annual revenues -- implies a move in the company's head office. "What's the importance of a head office in today's economy?" asked Rancourt. "Our head office is wherever I decide to plug in my laptop."

Publicis Canada has been part of Publicis SA -- the tenth largest agency in the world --since former owner Yves Gougoux, sold a 70 per cent stake in the company's Montreal office, (now known as Publicis-BCP) to the Paris-based giant. Soon after the deal was closed, Gougoux was nominated president of Publicis Conseil, the international giant's France division.

Gougoux's growing influence within the Publicis SA group, influenced both the hiring of Rancourt as head of Publicis Canada, and the infusion of extra cash into the Canadian operation.

Flush with the extra cash, Publicis Canada picked up some pricey talent, notably brothers Andrew and Duncan Bruce, who were appointed vice-president and COO and senior vice-president and creative director, respectively, of PublicisoSMW, the firm's Toronto office.

The new team soon delivered, landing both the Microsoft and CIBC accounts against what surely must have been long odds, for a firm that until recently had a relatively week Ontario presence.

"You have to remember that although we do not have any banking clients, all of our senior staff people had experience in the industry," said Rancourt. "The CIBC was also interested in developing a new strategic orientation, an area in which we are strong."

Because of their huge advertising budgets, Canada's chartered banks are restricted to dealing with ad agencies that have the extensive resources to handle a multi-disciplinary marketing program. That limits them to the big agencies.

"Although it was a fair process, it was one of the toughest pitches I have ever been on," said Rancourt. "They started by looking at 90 different agencies, and stage by stage narrowed it down to one."

In practice, when a big-six bank, wants to choose an agency, those handling its five big competitors are off limits. That, and the fact that a large Canadian agency would inevitably be the winner, gave Publicis Canada its crack at the can.

To handle the extra business Publicis Canada has been on a hiring spree, which along with acquisitions, such as the March buyout of design firm Goodhue & Associés, should see the firm's staffing rise to above 400 by the end of the year, up from 265 in 1998.

But as if new clients, new staff and acquisitions were not enough, Rancourt must also deal with the uncertainty caused by parent company Publicis SA's negotiations to purchase a major American ad agency.

The latest front runner is Young & Rubicam, for whom Rancourt worked as director of operations at its German subsidiary Wunderman Cato Johnson, before being hired by Publicis Canada. A combination of the two giants, would create the world's fourth largest agency

"I don't have any inside information about the negotiations to give you, all I know is what I read in the paper" said Rancourt. "What I can say is that Publicis SA is very committed to North America. And you have only seen the beginning."

 

Photo caption: According to Publicis-BCP president Serge Rancourt, the company's head office is wherever he happens to set up his laptop.

E-mail can be sent to Peter Diekmeyer at peter@peterdiekmeyer.com

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