26 Oct Taking a look back: Jupiter Joburg closes, Black Powder take over baton
by Herman Manson (@marklives) Iconic South African ad agency The Jupiter Drawing Room (Johannesburg) has been closed down, The Lionheart Brand Holding Company, owners of The Jupiter Drawing Room brand, has confirmed. The agency is no longer trading and the shutdown happened over the course of 3–4 months earlier this year. It no longer employs any staff.
Two former senior managers at the agency, Gugu Madlala and Sizwe Kumalo, have contracted with Jupiter Joburg’s remaining client roster through their agency, Black Powder (as in gun powder). Madlala explains that he and Kumalo had initially joined Jupiter Joburg to help drive new business opportunities and to explore empowerment options for the agency.
Intended as a separate agency
The two have launched Black Powder as an integration specialist through-the-line agency, developed out of The Jupiter Drawing Room & Partners Group. While it had sat next to and pitched alongside Jupiter Joburg, it had been intended as a separate agency whose future would not depend on the commercial success of Jupiter.
Black Powder has been operational for several months and has been holding off on announcements pending completion of formal shareholder agreements, which will see it transformed from a majority-black-owned agency into a 100% black-owned business. Its clients include the South African Reserve Bank (SARB), Tiger Brands, AMKA Brands, Denel Aeoronautics, ABInBev and ZTE.
The Jupiter Drawing Room was launched in 1989 by Graham Warsop. In 2009, WPP acquired a 49% stake in The Jupiter Drawing Room & Partners, which included agencies in Johannesburg and Cape Town plus subsidiaries, such as Black River FC and MetropolitanRepublic.
Famously won R1bn in new biz
Jupiter Joburg famously won R1bn of new business billings in three pitches over three consecutive days in 2007. Its client roster came to include Absa, Edcon, MTN and Sasol but in 2016 it lost the last of these accounts, when FCB Africa won the consumer component of the Barclays Africa Group ad account from the agency. Since then, it has been an open question as to how long the agency would survive.
Says Warsop on the launch of Black Powder, “Last year The Jupiter Drawing Room (Johannesburg) took a significant hit after a mandatory procurement-led RFP process by client Absa/Barclays, which saw the client leaving the agency. Before this, we had already been looking at how we could operate as a fully transformed agency, so it made sense at that time to make a radical move. We could have divested additional shares in the Jupiter (Jhb) agency to move to 51% black-ownership, but we decided instead to look at how we could create a new 100% black-owned agency.”
Madlala explains that Black Powder is set to become 100% black-owned following an agreement with The Lionheart Brand Holding Company (WPP will own no shares in Black Powder). While the agency will retain a licensing agreement, all shares will be held by Madlala and Kumalo.
Works closely with Timesquare
Black Powder has seven permanent employees but works closely with independent marketing communication agency, Timesquare, with which they share an office and in which Madlala also has a shareholding. Timesquare assists with creative, production and delivery, and gives Black Powder access to another 12 staffers.
According to Madlala, Black Powder’s offering is differentiated by its appreciation of the commercial reality of its clients. It has an appetite for the business of business, and respect for the commercial aspects of a client’s business, especially the need to increase sales. It also loses the ego at the door and works well in a team with multiple agency partners.
Meanwhile, The Jupiter Drawing Room (Cape Town) has had a tough 2017, having lost both Hyundai (to FoxP2) and Windhoek Beer (to M&C Saatchi Abel Johannesburg). A statement released by The Jupiter Drawing Room & Partners states that Jupiter’s operations in Cape Town and outside of South Africa (in Zimbabwe, Malawi, Zambia and Mauritius) “continue with business as usual and are unaffected by these developments”.