Hi-Tech PR - Agencies play name game but who wins? - Over the past month, Porter Novelli joined forces with C&B to form the PN Convergence Group, TSI divided into three separate agencies under GlobalComm, and Cunningham split into six distinct compa

’It’s all about building and maintaining the brand.’ Hi-tech PR firms have hammered this mantra into clients’ minds for years, but a recent spate of agency name changes suggests that this principle has gone right out the window.

’It’s all about building and maintaining the brand.’ Hi-tech PR firms have hammered this mantra into clients’ minds for years, but a recent spate of agency name changes suggests that this principle has gone right out the window.

’It’s all about building and maintaining the brand.’ Hi-tech PR

firms have hammered this mantra into clients’ minds for years, but a

recent spate of agency name changes suggests that this principle has

gone right out the window.



First, the news broke that Weber subsidiary Technology Solutions (TSI)

was diluting its brand by forming three separate agencies - TSI

Communications Worldwide, Mindstorm Communications, and Web development

company Ovation Studios - under the newly formed GlobalComm Group

Losing the Technology Solutions name wasn’t a huge shock, as the agency

had been going by TSI for quite some time, and Mindstorm and Ovation had

also been in development before they were formalized under

GlobalComm.



Cunningham Communications followed suit late last month when it

announced a split into six separate companies - Cunningham PR, Brand

Momentum, Momentum Research, InMomentum, Austin-based Cunningham

Ventures, and San Francisco-based Fifth Gear. While this was largely a

formalization of existing practice areas a la GlobalComm, the last two

practices were created to work with dot-coms in their local geographies

and experiment with a mix of cash and equity for services.



Going in a different direction, Porter Novelli merged its tech practice

with Copithorne & Bellows’ to form the Porter Novelli Convergence Group,

erasing the esteemed C&B name. While CEO David Copithorne admits this

was a risk and cites the work that had gone into building the C&B brand,

it apparently wasn’t enough to save the C&B name.



Is there strength in numbers?



Why are agencies trading a strong brand name for numerous weaker

ones?



One reason appears to be greed.



’If there’s a conglomeration of several firms and one holding company,

they are able to take on more business because they don’t have

conflicts,’ says Harry Pforzheimer, EVP and GM of Edelman’s Western

region. ’But if it’s consolidated, there are tremendous nightmares and

competes.’



Some pros also say that agencies splitting into different brands are

trying to appeal to the influx of dot-com business. ’These agencies see

tremendous opportunity in start-ups,’ says Jonelle Birney, president and

CEO of Blanc & Otus. ’Everyone’s trying to look like a hot start-up and

approach the market differently.’



And by forming different groups, agencies such as Cunningham may be

making it easier to sell off certain parts of the business and retain

ownership of others. ’As you break up component parts, you naturally

liberate certain pieces of the business for their own future growth,

including a potential acquisition,’ says Miller/Shandwick chairman Fred

Hoar.



’Cunningham has been for sale forever, but (chair and CEO) Andy

(Cunningham) wanted such a premium for the brand that no one thought

about acquiring it,’ says one industry insider, adding that these

smaller parts of the business may be more attainable. When asked about

the possibility of selling off one or more of the six parts, Cunningham

hedged: ’I’m sure that might someday come into play, but right now, I’m

thinking of growing our footprint.’



Those who have divided into several agencies claim the move will help

with employee recruitment and retention, the current bane of the

industry.



For example, having multiple companies means that senior-level employees

have a greater chance of heading one of them. Employees looking for a

change can also go to a sister company, rather than a competitor -

Cunningham thinks Fifth Gear will attract pros who want to be in a Bay

Area, entrepreneurial environment.



While this may give employees a reason to stay, is it really going to

help fill the empty entry and mid-level slots? ’You can have 50

different companies, but it doesn’t change the fact that we have serious

talent issues in the business,’ says FitzGerald Communications CEO Maura

FitzGerald. ’There are only so many great people to go around.’



Porter Novelli CEO Bob Druckenmiller counters by saying that the PN

Convergence Group plans to develop a stronger technology practice in

Washington, DC. Since this was an area where C&B did not previously have

an office, the firm may be able to find more talented hi-tech PR help

there than in other areas, he argues.



But what about the benefits to clients? ’No one has been able to

articulate that,’ says FitzGerald. ’This is fundamentally a

consultant-based business, and if you can’t answer that question, you

shouldn’t be doing these things.’



Cunningham thinks it won’t matter to clients at all. ’It will be fairly

invisible,’ she says. And Pforzheimer doesn’t believe that clients care

if an agency is operating under several different names. ’All agencies

offer the same stuff anyway,’ he says. ’I don’t think that clients are

caught up in, confused by, or impressed by methodology or new brands -

they care about results.’



He adds that if spin-offs are too small and don’t have global

capabilities, clients will not be interested in them. And Copithorne,

now managing director of the PN Convergence Group, says that clients

really want everything under one roof.



However, GlobalComm CEO Cohen says that by creating a more nimble

organization, each company has the ability to be smarter and faster for

clients, and Hoar agrees that by splitting up into separate companies,

agencies can provide better service.



’This is kind of a seismic development which can service targeted, very

specific needs of narrower slices of business,’ says Hoar. ’I suspect

that clients will regard the narrower slice as more tailored to their

needs.’



It looks like a trend, but will others soon follow? Cohen thinks so.



’If you’re interested in growing in a competitive market, you have to

look at growing new brands,’ he says. But industry veterans remain

skeptical.



While Birney says B&O is looking at ways to position itself differently,

she says it won’t be parceling off pieces of business under different

names. ’That specific approach is confusing,’ says Birney.



Confusing yet compelling



FitzGerald also says she will not be following suit, and even claims

that rivals forming separate brands will help her business. ’By

confusing everyone, they’re making our story easier and more compelling

to tell,’ she says. Cunningham admits that outsiders won’t be able to

tell what services each company offers by its name, but says there’s

actually a disadvantage to attaching the Cunningham name to each unit:

’The fashion is to stay away from the owner’s name. It creates a

problem, because people still think that since my name is on the door,

I’m going to work on their account.’



With hi-tech PR agencies championing themselves as creators of the

brand, it will be interesting to see how successful they are in creating

their own.



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