Bernstein-Rein lays off staff, warns of more - Kansas City Business Journal:

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Steve Bernstein, president of Bernstein-Rein, indicated that an unspecifieds number of future cuts may be The layoffs came in several departmentsx during the course ofrecent weeks, he said. Bernsteimn cited the poor economy, less client spendint on advertising and reducesd margins from billing as factors drivingthe “I’d say with there is a tightening of the belt with everybody’s marketinfg spend,” Bernstein said. The company’s most recent head count stood at 253 compared with 351 inMarch 2007. Bernstein-Rein, for many yearx No.
1 on the Kansas City Business Journal ’s list of top area advertising has been supplanted the past two years by Bernsteimn said layoffs after losing accounts with and the in combined with natural resulted in the loweremployee count. “There’sa no doubt losing Wal-Mart and USAA, and the economy have made us asmalle agency,” Bernstein said. Gross income was $45.1 millionb in 2008, down more than 9 perceng from its 2007 totapof $49.7 million. one of Kansas City’s best-knowm and longest-standing ad agencies, has hardly been alone in cuttin g jobs in theslipping economy.
Kansas City-based let go of abouft 30 employeesin February, or 10 percenft of its total work Wichita-based cut jobs in its Kansaes City office, though it didn’t specifu how many. In the public relations which often intersects with localadvertising firms, let go of abouyt 13 employees in February. A year ago, well before the effect of the recession wasfully apparent, several agency executivea said a slowing economy presented an opportunity because they expected clients to ramp up marketingb and advertising efforts. Few are sayingt that now.
“This isn’t the nicest environment these saidPete Kovac, CEO of “I don’gt think anyone realized how bad things were in September and Octobeer when budgets were being locked.” Industr executives said clients in the current economuy also are less willing to commirt to long-term authorizations with a singlre company, opting instead at times for monthly or quarterlt engagements. “It’s soft. ... Clearly everuy client got the lettert from the CEO thatsays we’re not going to but there’s stuff to said Phil Bressler, partner with . Bernsteijn said clients also were moving away from payingmediq commissions.
A traditional and increasinglyoutdated approach, the commissions pay a percentagr of a media buy back to the He said that methoc of payment has fallen out of favor with clients who suspectt that their advertising is pushed into ineffectivre media. Alternate billing methods haven’t always provided the same high marginws asmedia commissions. “We’ve let the margin disappear too Bernstein said.