MARKET FOCUS: PENNSYLVANIA - The Pennsylvania PR story. Although Pennsylvania is a major agricultural state, it offers a diverse PR scene. As Kelley Crowley reports, the real action occurs in newly dubbed ’Philacone Valley’ and ’Ro

There’s an old Pennsylvania saying that the land between Philadelphia and Pittsburgh is Nebraska - Pennsylvania has the largest rural population in the nation and its economic keystone is agriculture.

There’s an old Pennsylvania saying that the land between Philadelphia and Pittsburgh is Nebraska - Pennsylvania has the largest rural population in the nation and its economic keystone is agriculture.

There’s an old Pennsylvania saying that the land between

Philadelphia and Pittsburgh is Nebraska - Pennsylvania has the largest

rural population in the nation and its economic keystone is

agriculture.



The Pennsylvania heartland is bookended to the east by cosmopolitan

Philly, with its insurance and pharmaceutical businesses, and to the

west by almost-Midwestern Pittsburgh, with its hi-technology and

healthcare industries.



The state’s infrastructure, communications and transportation

capabilities enticed many national and international companies to make a

home and often their headquarters in the Keystone State.



Fortune 500 companies like H.J. Heinz, Alcoa and PNC Bank are all a part

of Pittsburgh’s culture and the changing face of the local economy.

Alcoa’s new innovative, glass-heavy headquarters building on the city’s

North Shore garnered national media attention. PNC Bank will lend its

name and some of its cash to the new baseball stadium, dubbed PNC

Park.



For years, Philadelphia’s outgoing mayor, Ed Rendell, led the city’s PR

bandwagon by helping agencies with community-based programs, sometimes

attending six or seven events a day. Many in the PR community are

saddened by his departure and wonder if the incoming mayor, John Street,

will be as accessible. The waterfront ’Phillywalk’ is a dollars 98

million project geared toward bringing in even more tourism revenue. And

this solidly Democratic town will be hosting the Republican National

Convention next year, proving it really is the City of Brotherly

Love.



The mood wasn’t always so bubbly. The late-eighties economic downswing

caused the state’s big employers to tighten up. A lot of the largest PR

agencies struggled as corporations dropped their large retainers and cut

back on their own communications staffs.



The business atmosphere, however, became friendlier to entrepreneurial

types, with local governments working hard to entice Internet start-ups,

research firms and software makers to open shop in their areas. These

mid-sized outfits are starting to make a significant economic

impact.



Pennsylvania’s two largest cities are both hot in the race with the rest

of the country for hi-tech dollars. The Greater Philadelphia Region has

the third-largest concentration of research institutions in the US. R&D

companies like SmithKlein Beecham and United Research Laboratories have

decided to call Philadelphia’s suburbs home. The area has been dubbed

’Philacone Valley.’ The Wall Street Journal, focusing on Carnegie Mellon

University’s robotics program, recently named Pittsburgh one of the

nation’s hottest hi-tech cities. Local newspapers have been talking

about the emergence of ’Roboburgh.’



The state’s economic boom has been keeping Pennsylvania’s PR agencies

busy. Ketchum PR is one of the oldest agencies in the country and the

largest in the state in terms of 1998 in-state revenue (dollars 7.8

million), according to the PRWeek list of top 10 Pennsylvania agencies

by revenue.



The BSMG-owned Tierney Group, in Philly, ranks number two, with dollars

6.3 million, trailed by Burson-Marsteller (in Pittsburgh) with dollars

4.9 million.





Not an ugly step-sister



Philadelphia pros say their shops have kept pace with their haughty

cousins in New York. ’Some big corporations and agencies probably have

the perception that we’re an ugly step-sister to New York City,’ says

Scott Tattar of Tattar Cutler, the firm that ranks ninth on the PRWeek

list. ’We may be a step-sister, but we’re really not that ugly.’



Tattar and others in the Philadelphia area are starting to see local and

national businesses’ perceptions change. More often, Pennsylvania

companies are looking for something other than a brand name and are

being well served by smaller, locally run shops.



’A couple years ago, there was a real push in the Philadelphia community

to keep accounts ’in the family’ - to award them to Philadelphia

agencies instead of New Yorkers,’ says Jeanne Russo, PR director for

Schubert Communications.



’I believe this campaign helped increase local corporations’ awareness

of the resources they have here in our own backyard.’



Brian Tierney of the Tierney Group understands the sentiment about

Philadelphia doing work with Philadelphians, but he also thinks that his

peers should look at the quality of the work. ’Some people in the

business whine about Philadelphia (companies) going elsewhere for their

PR work,’ Tierney says, ’but I’m not going to support a restaurant in my

neighborhood if I don’t like the food - and I don’t think anyone else

should, either.’ The Tierney Group’s income accounts for only 6% of BSMG

1998 revenue.



While Philly agencies are battling it out with New York and New Jersey

shops, Pittsburgh finds there is little crossover when wooing a

client.



’Unless you are talking about a state contract, I have found very little

competition with Philadelphia,’ says Katie McSorley, who heads the

business-to-business practice in the Pittsburgh office of New York-based

Creamer Dickson Basford.



But McSorley says she sees increasing competition within Pittsburgh.



’There are many new, young agencies with three to 10 employees that have

been launched in the last 10 years’ by people who left - and now compete

with - the established agencies.



Pittsburgh’s economic condition improved with shots of hi-tech and

healthcare capital. The entrepreneurial companies that started 10 to 15

years ago have grown to the point where they now need complements to

their in-house staffs or firms that provide niche capabilities.



’Firms like ours have grown largely on the strength of the middle market

in Pennsylvania - businesses with less than dollars 500 million in

sales,’ says Karl Skutski of the Pittsburgh-based independent Skutski &

Oltmanns, which is sixth on the PRWeek list, with dollars 1.7 million in

revenue. ’Many of these accounts are too small for the major agencies to

service well and cost-effectively, but the clients still need the best

talent and a full complement of resources.’





Live locally, work globally



Indeed, Ketchum credits the Keystone State with only 8% of its income,

though it has big Pittsburgh-based clients such as Heinz and

Highmark/Blue Cross. ’Our client work is about 50% local with large

Pittsburgh companies and 50% from Washington, DC, San Francisco, New

York,’ says Kelley Murray Skoloda, SVP of Ketchum’s Pittsburgh office.

’I have the good fortune of being able to work and live in a relatively

small city, and at the same time be exposed to multinational client

work.’



As the number-one agency in the state, Ketchum has provided a solid

education for independent shops like Tattar Cutler and the

Pittsburgh-based Jack Horner Communications. Both Scott Tattar and Jack

Horner came out of Ketchum armed with the skills to start their own

business and they have thrived, even with big companies. For example,

Horner’s agency handled the PR campaign to unveil the Alcoa Corporate

Center to internal and external audiences, earning media coverage

throughout the US, including a four-page spread in The New York Times

Sunday magazine and a CNN segment.



Smaller agencies can find niches and flex with market demands. Bigger

agencies, however, don’t always have the economic elasticity of smaller

shops since they often rely on the large retainers of multinational

companies.



Philadelphia-based Earle Palmer Brown felt that squeeze when its numbers

for 1998 dropped by 20% while everyone else was cruising near an average

gain of around 20%.



’We lost significant business largely due to being on the wrong side of

mergers and acquisitions,’ says John Moscatelli, SVP and associate GM

for EPB. ’For example, one of our largest PR clients was

(convenience-store chain) Split Second at Amoco. When Amoco merged with

BP, they changed their C-store marketing approach, which resulted in the

termination of our relationship.’



EPB Communications, to which Earle Palmer Brown belongs, is continuing

to expand despite last year’s numbers for its PR unit. The network

recently acquired Ketchum Advertising’s Pittsburgh office, now called

Egan/St. James. Moscatelli thinks that larger agencies like his will be

forced to find ways to reduce overhead to remain competitive but some

things will always stay the same.



’For clients marketing nationally or globally, the agency no longer has

to live down the street,’ says Moscatelli, ’but there will always be a

need for PR pros who know the local market and can help a client with

locally driven issues and initiatives.’





KEYSTONE’S KEY PLAYERS: TOP 10 FIRMS

Rank      Company                       PA Income                 Change

98   97                                      1998         1997         %

1    1    Ketchum PR                    7,787,000    7,210,000         8

2    2    BSMG (The Tierney Group)      6,306,592    5,871,865         7

3    3    Burson-Marsteller             4,859,000    3,850,000        26

4    5    Dorland Sweeney Jones*        2,977,000    2,237,000        33

5    4    Earle Palmer Brown PR         2,100,000    3,200,000       -34

6    6    Skutski & Oltmanns            1,657,399    1,334,490        24

7    7    Dudnyk PR                     1,156,000      957,000        21

8    8    Andrews Sacunas & Saline        872,100      716,753        22

9    10   TattarCutler                    819,147      636,569        29

10   9    Toplin & Associates             789,471      657,648        20

          1998 Total Income            29,323,709   26,671,325        10


Rank       Company                            US income       PA %

98    97                                           1998       1998

1     1    Ketchum PR                       101,485,000          8

2     2    BSMG (The Tierney Group)         109,537,000          6

3     3    Burson-Marsteller                136,596,000          4

4     5    Dorland Sweeney Jones*             2,977,000        100

5     4    Earle Palmer Brown PR              8,800,000         24

6     6    Skutski & Oltmanns                 1,657,399        100

7     7    Dudnyk PR                          1,156,000        100

8     8    Andrews Sacunas & Saline             872,100        100

9     10   TattarCutler                         819,147        100

10    9    Toplin & Associates                  789,471        100

           1998 Total Income                364,689,117          8



Rank       Company                      US income    PA %       Location

98    97                                     1997    1997

1     1    Ketchum PR                  78,769,000       9     Pittsburgh

2     2    BSMG (The Tierney Group)    58,136,000      10   Philadelphia

3     3    Burson-Marsteller          119,330,000       3     Pittsburgh

4     5    Dorland Sweeney Jones*       2,237,000     100   Philadelphia

5     4    Earle Palmer Brown PR        6,500,000      49   Philadelphia

6     6    Skutski & Oltmanns           1,334,490     100     Pittsburgh

7     7    Dudnyk PR                      957,000     100        Horsham

8     8    Andrews Sacunas & Saline       716,753     100     Harrisburg

9     10   TattarCutler                   636,569     100        Horsham

10    9    Toplin & Associates            657,648     100        Dresher

           1998 Total Income          269,274,460      10


Source: PRWeek Top 200

*Includes San Francisco office.



Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Would you like to post a comment?

Please Sign in or register.