WeWork wants you to know that it means business. After what can only generously be described as a disastrous fall--culminating in a canceled IPO and the resignation of CEO and co-founder Adam Neumann and massive layoffs--the company has changed not only its leadership but its strategy. Or at least that's the message the company is trying to convey with a full-page ad that ran over the weekend in newspapers including The New York Times, The Wall Street Journal, USA Today, and others.
The ad is the first move by WeWork's new chief marketing officer, Maurice Levy, and was created by Publicis Groupe, where Levy is still chairman. The fact that the co-working rental company brought in one of the most powerful men in advertising to guide its rebranding strategy tells you everything you need to know about how bad things really are.
Look, I'll readily acknowledge that Levy is a far more accomplished marketer that I am. However, I still think it's worth asking whether an ad is likely to make any kind of difference at this point in the We story. Here's why:
WeWork's brand is broken. That didn't happen because the company had a bad advertising strategy. It didn't happen because WeWork wasn't marketing itself in the right places with expensive ads in the biggest daily papers in America. It happened because the company was broken.
The company had been broken for a while, it turns out. Despite its unicorn status, WeWork had problems that were apparently easy for investors to overlook. That's what happens when a company puts on enough of a show--it's hard to tell what's real.
But the company's problems go far beyond its wild-spending co-founder and the fact that he had almost absolute control of the company. Control that he used to install family members and self-deal in ways that raised concerns once the company was looking to go public.
For example, WeWork was lending money to Neumann at almost no interest, which he used to purchase buildings, in which he would then rent space back to WeWork. Not a bad arrangement if you can get it. Except the company is losing huge amounts of money ($900 million in the first half of this year). That just doesn't add up.
Now, WeWork and its SoftBank benefactor seem to be pretty serious about trying to turn things around. Much of the previous leadership team has been replaced. The company is laying off 2,400 people and getting rid of the private jets. It booted Neumann (though it paid him handsomely on the way out the door). And, of course, the ads.
Those ads are aimed at turning the corner on a run of bad PR, and maybe they will, but a nice poem printed in ink on newsprint doesn't actually make you a leader of a "movement." If you have to tell people you're leading a movement, you probably aren't. If you were, we'd already know. We'd see it by your actions, not by your ads.
Actions, by the way, that are largely missing from the substance of the ad. Sure, it says right there that WeWork is "ready to do what's needed to be an even better partner." That sounds great, but I have no idea what it means. Really, it isn't all that surprising for a company that refers to itself as a champion of "space as a service," which isn't actually a thing.
Instead, it's marketing speak for "we want you to think of us as a tech company because then it's OK that we lose money." That part, it seems, hasn't changed. WeWork is still the same company with the same business model. It just happens to have better copywriters than before and an ad guy who knows how to get the message out.
Whether that message is anything more than fancy words depends on whether WeWork has figured out how to fix what's broken, or whether it's just more show.