WeWork was planning to spend millions on advertising even as its own finances were collapsing
WeWork
- WeWork was planning to spend millions on advertising even as its own finances were collapsing.
- WeWork wanted to better define its brand and run a major ad campaign following a planned initial public offering.
- WeWork invited some of the hottest ad agencies including Wieden and Kennedy, 72andSunny, Droga5, and Vice's Virtue to pitch for its business earlier this year.
- According to several sources, the campaign would have cost at least $5 million.
- As investors grew increasingly concerned about WeWork's finances, the review was placed on hold and eventually cancelled.
- "We pitched, and the next week everybody got fired," one source said.
- After the IPO's cancellation, WeWork named Maurice Levy as interim CMO and hired his agency, Publicis Groupe, to handle its marketing.
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Even as WeWork's flashy initial public offering collapsed this fall, the troubled co-working company was planning a multimillion-dollar ad campaign.
Several of the industry's top creative agencies - including Wieden and Kennedy, 72andSunny, McCann, Anomaly, Droga5, and Vice-owned Virtue - were invited to pitch for what the startup positioned as an opportunity to introduce its brand to the world at large with a bang.
The review ended when WeWork's IPO "exploded in their faces," one source said, with executive chairman Marcelo Claure trying to clean up the mess by naming Publicis Groupe chairman Maurice Levy as interim CMO and hiring Publicis to oversee WeWork's advertising.
Business Insider first reported on Publicis Groupe's inaugural WeWork campaign, which went live December 6 with print placements in major newspapers.
WeWork wouldn't comment for this story. Spokespeople for all the agencies declined to comment or did not respond to emails.
WeWork planned to spend at least $5 million on the campaign, but its own finances were shaky
Seven people with direct knowledge of the matter said the beleaguered co-working company wanted to better define its brand and create a major post-IPO ad campaign.
Two sources said Droga5, Virtue, and 72andSunny were the finalists for a contract that would entail at least $5 million in fees and production costs, with room to expand.
The company had already proven its willingness to spend heavily, with a sales and marketing budget that ballooned to $375 million in 2018.
Companies that size usually use an outside consulting firm to choose an agency, but WeWork decided to manage the process itself, from writing its own request for proposal (RFP) documents to making the agency selection. Like a lot of startups, WeWork did most of its marketing in-house.
WeWork issued its RFP in late July, less than one month before the now-infamous IPO filing. Some agencies passed on the opportunity while others quickly got to work developing their best ideas for the brand.
WeWork wanted the campaign to make an epic cultural statement
One source close to the business said WeWork wanted a campaign to explain its offerings to the world. Another described the agency brief as "very light," showing the company wanted to make a major cultural statement rather than addressing any specific business objectives.
The review process lasted about two months, continuing even as WeWork entered financial crisis mode.
The chaotic six weeks that followed its August 14 S-1 filing, which led to the withdrawal of the public offering and Neumann's subsequent ouster, have been well-documented. As negative press overwhelmed the company and most of its top marketers left, the review stalled.
The second source told Business Insider that his agency was scheduled to meet cofounder Adam Neumann and his wife around the time WeWork place the review on hold.
As a third person put it, "We pitched, and the next week everybody got fired."
The unicorn goes into damage control mode
Marcelo Claure joined WeWork as executive chairman about one month later and began to plot the brand's comeback.
A major part of that effort involved naming a new executive team that included Levy. The first source familiar with WeWork's business said Levy, who still actively works with Publicis clients, came on quickly, and that the company is still waiting to learn what his focus will be as he familiarizes himself with the business.
Publicis Groupe's debut print ad for WeWork ran in The New York Times, The Wall Street Journal, and The Financial Times and called WeWork a business "on the move," "in the vanguard," and "the world's leading co-working and service-as-a-space platform."
Meanwhile, WeWork's challenges go well beyond advertising as real estate experts question Claure's expansion-heavy turnaround plan and WeWork's primary investor Softbank looks to recover from a 30% drop in its shares since the disastrous S-1 filing.
