Brodeur Partners: Agency Business Report 2007

Tech is still core to Brodeur's business, but is no longer its only focus, Andrea Coville, Brodeur CEO says.

Tech is still core to Brodeur's business, but is no longer its only focus, Andrea Coville, Brodeur CEO says.

"It's important to stay one step ahead," she adds. "[Our tech] heritage has given us a leg up" in being at the forefront of new technologies and ideas.

The firm cites key developments with consumer business and electronics clients. It also reported advancements in b-to-b global corporate communications programs, as well as the entertainment sector, via work with clients such as The History Channel, Starz Entertainment Group, and Discovery Communications.

Key facts
Principal: Andrea Coville, CEO

Ownership: Omnicom Group, as part of Diversified Agency Services

Subsidiary companies: Rx Mosaic Health, Beaupre & Co., InComm Brodeur (Korea), Brodeur India

Offices: Seven wholly owned in the US, two wholly owned in the rest of the world. Six partly owned in Asia, and another 32 partly owned in EMEA through its Pleon partnership

Staff
Brodeur added several senior-level execs in 2006. Notably, former Zeno Group MD Charlotte Wray joined as president of the firm's newly launched Rx Mosaic Health. In addition, Judy Feder, EVP in New York, launched its new social entrepreneurship offer, and Jerry Johnson, EVP in DC, started the firm's strategic planning and digital-communications services group. Exits included Thom Brodeur, VP in Phoenix, who left to head global strategy at client Market Wire, and COO Ray Thomas, who started his own consultancy.

Structural changes
In July 2006, Brodeur launched Rx Mosaic Health, a boutique specializing in healthcare marketing and corporate communications. It also forged a partnership with digital communications firm Echo Ditto. Overseas, Brodeur expanded its branded operations in India to include the Indian PR arm of Omnicom sibling TBWA.

Regional performance
Business has been robust across the US, the firm reports. India, China, Vietnam, Turkey, Romania, and Bulgaria are among the global markets to have shown growth.

"It's important to stay one step ahead," she adds. "[Our tech] heritage has given us a leg up" in being at the forefront of new technologies and ideas.

Practice areas
Brodeur - long known as a tech PR firm - reports strong growth in each of its practices, including b-to-b (50%), consumer marketing (25%), social marketing, and healthcare. Within its core practices, it offers 16 functional divisions, ranging from analyst relations and CSR to experiential marketing and clean tech. New areas included strategic planning, digital communications, and social entrepreneurship.

Accounts
American Express, RWD Technologies, and The Pearl Harbor Memorial Fund were among key wins. Business grew organically, as well. According to the firm, project work for established b-to-b clients including Avnet and Corning continued to expand in the US and internationally. At Rx Mosaic Health, wins included CV Technologies/COLD-fX OrthoNeutrogena and Sepracor/Lunesta.

Financial performance
Brodeur achieved both top- and bottom-line growth in 2006. It reports annual US revenue under $50 million; global revenue between $100 million and $200 million.

Agency's full questionnaire follows below:

Name of parent division/company (enter both where applicable)
OMNICOM GROUP

Name of subsidiary companies
Beaupre & Co.
InComm Brodeur (Korea)
Brodeur India

Has your ownership status changed in the past year? If yes, please explain
No.

Name of global CEO and US CEO (or most senior equivalent)
Andrea Coville

Name of person, if any, the most senior person named above reports to
Dale Adams, president, DAS, Omnicom

What is your current headcount?
Unfortunately, due to SEC rules and Omnicom policy, Brodeur can no longer make public its revenue, employee numbers or any financial information. Brodeur is part of Omnicom Group, Inc. (NYSE: OMC).

How has your headcount changed since FY 2005?
Unfortunately, due to SEC rules and Omnicom policy, Brodeur can no longer make public its revenue, employee numbers or any financial information. Brodeur is part of Omnicom Group, Inc. (NYSE: OMC).

What was the percentage of staff turnover in 2006?
Unfortunately, due to SEC rules and Omnicom policy, Brodeur can no longer make public its revenue, employee numbers or any financial information. Brodeur is part of Omnicom Group, Inc. (NYSE: OMC).

Did you make any senior hires in 2006 (VP and higher)? Please state name, title (and unique responsibilities, if applicable), and previous company
Charlotte Wray, president, Rx Mosaic Health, formerly with Zeno Group (July 2006)
Melissa Weibel, SVP of Rx Mosaic Health (July 2006)
Rick Allen was appointed president of Brodeur Asia (August 2006). He was formerly with our affiliate EBA in Hong Kong.

What senior staff have departed the firm? Please state name and previous title
Ray Thomas, COO, left Brodeur in March 2006 to start his own consulting practice.
Judith Navoy, VP in the Boston office left Brodeur in September 2006 to pursue an advanced degree.
Thom Brodeur, VP in the Phoenix office, left Brodeur in January 2007 to head up global strategy and development at long-time Brodeur client, Marketwire.

Please list any other senior management changes, including restructures and significant, senior-level promotions
The Brodeur US operation is now organized into two areas, Consumer Marketing and Business-to-Business led by EVPs, Michael Brewer and Steven Marchant, respectively.

In early 2007, Leslie Tullio was promoted from VP to SVP and now runs the Brodeur Washington, D.C. office. Jerry Johnson, EVP of Brodeur's Washington DC office is now heading up Brodeur's Strategic Planning and Digital Communications Services.

Judy Feder, EVP of the New York office has started a new Social Entrepreneurship functional practice.

Sonia Bovio, VP in Phoenix is now leading the Phoenix office.

Have you made any acquisitions in the past year, or merged with another agency?
On February 8, 2006, Brodeur expanded its branded operations in India to include the Indian PR operations of sister Omnicom advertising agency TBWA. This resulted in Brodeur's immediate access to resources in six Indian cities. This move provides the springboard for Brodeur's expansion in the sub-continent, and is a key element in the agency's development strategy for the whole Asia Pacific region.

In July of 2006, Brodeur started a new division: Rx Mosaic Health a boutique-style agency specializing in healthcare marketing and corporate communications for the pharmaceutical, biotech, device/diagnostic and OTC healthcare space.

In January of 2006, Pleon Europe acquired six new offices in Central and Eastern Europe and Russia through a mixture of acquisitions and a transfer of responsibility from sister Omnicom agency BBDO. This move underlined Pleon's claim to be Europe's leading communications consultancy and made it the largest branded Agency in Europe with 31 Pleon-branded offices in 15 European countries.

How many wholly owned offices do you have globally? Please list with agency names and cities under the following headings. Add majority-owned offices in parentheses.
Brodeur operates Brodeur branded and equity-owned offices in the United States, Korea, Hong Kong and India, and serves clients in EMEA through the Brodeur | Pleon Worldwide network. Globally, including partners and affiliates, the Brodeur |Pleon Worldwide network operates from 80 offices in over 50 countries.

North America
Brodeur Boston
Brodeur New York
Brodeur Washington, DC
Brodeur Phoenix
Rx Mosaic Health New York
Rx Mosaic Health Washington DC
Beaupre & Co. -- Portsmouth, New Hampshire

Asia Pacific

Brodeur InComm: Seoul, Korea
Brodeur Asia Pac Regional HQ: Hong Kong
Brodeur India (6): New Delhi, Mumbai. Chennai, Bangalore, Pune, Coimbatore

How many partly owned offices or affiliates do you operate globally? Please list agency names and cities under the following headings.
Latin America (8)
Brodeur Argentina -- Buenos Aires
Brodeur Brazil -- Rio de Janeiro
Brodeur Brazil -- Sao Paolo
Brodeur Chile -- Santiago
Brodeur Krea Columbia -- Bogota
Brodeur/RU&A Panama - Panama City
Martec PR Mexico - Mexico City

Europe

Branded offices
Pleon Austria (5): Linz, Salzburg, Vienna, Klagenfurt, Graz
Pleon Belgium: Brussels
Pleon Public Affairs: Brussels
Pleon Central Europe: Croatia
Pleon Dialogue: Zagrab, Croatia
Pleon Impact: Prague, Czech Republic
Pleon France: Paris
Pleon Germany (8): Berlin, Bönn, Dresden, Düesseldorf, Frankfurt, Leipzig, Munich, Stuttgart
Pleon Hungary: Budapest
Pleon Italy (3): Milan, Rome, Genoa
Pleon Netherlands (2): Amsterdam, Tiel
Pleon Poland: Warsaw
Pleon Graffiti: Bucharest, Romania
Pleon Russia: Moscow
Pleon C-Matrix (2): Zurich and Geneva, Switzerland
Pleon UK: London
Pleon Talen: Kiev, Ukraine

Affiliates
Denmark: Holm Kommunikation (Copenhagen)
Finland: Netprofile Finland Oy (Helsinki)
Ireland: MRPA KINMAN Communications (Dublin)
Norway: Lynx Communications (Oslo)
Spain: Media Luna PR (Madrid)
Sweden: Turbolin PR (Stockholm)
Turkey: Bersay Communications Group (Istanbul)

Africa
South Africa: Sefin Communications (Johannesburg)

Middle East
United Arab Emirates Spot On Public Relations, Dubai

Asia Pacific
Australia: Recognition PR (Sydney)
China (4): Euan Barty Associates (Beijing, Guangzhou, Shanghai, HK)
Indonesia: Prisma Public Relations (Jakarta)
Japan: ad-comm group (Tokyo)
Malaysia: Samanea PR Sdn. Bhd.( Kuala Lumpur/Ampang)
New Zealand: Communication by Design (Aukland)
Philippines: Ardent Communications Inc (Makati City, Manila)
Singapore: Eastwest Public Relations (Singapore)
Taiwan: Access Public Relations (Taipei)
Thailand: Spark Communications (Bangkok)
Vietnam: Vietgate Communications (Hanoi)

What offices opened in 2006 or early 2007? (State when)
Rx Mosaic Health (NY and DC - August 2006)
Vietgate Communications (January 2007)

What offices closed in 2006 or early 2007? (State when)
Agency declined to give information

Which regions, US and globally, are growing, and why?
As a part of Omnicom, we can not comment on financial growth of our regions. However, we can tell you that as an industry we're seeing a general market growth in the following regions:

In the US, business has been strong as companies resume investing in PR as part of its overall marketing mix.

India and China remain strong growth areas, followed by Japan and also Vietnam, after its entry into the WTO in early 2007.

Eastern Europe is also seeing growth in terms of more advanced business services, the expansion of the EU to include Turkey and most recently, Romania and Bulgaria.

Which regions, US and globally, are growing, and why?
Agency declined to give information

Practice areas
How many practice areas do you have? Please list.
Under the Brodeur brand, practice areas have been reorganized into two distinct practices based on client audience: Business-to-Business and Consumer Marketing. Mike Brewer heads up the consumer marketing practice, Steve Marchant heads up Business to Business practice.

We also have functional expertise that sit across both of the practice areas:
Analyst Relations
Branding/Marketing
Corporate Communications
Corporate Social Responsibility
Change Management
Crisis Communications
Clean Technology
Digital Communications
Experiential Marketing
Financial Communications
Government/Public Affairs
Investor Relations
Media Relations
Mobility
Social Entrepreneurship
Strategic Planning (includes Competitive Intelligence and Research)

We also have two specialist brands serving two distinct industry practices:
Healthcare: Rx Mosaic Health, headed by Charlotte Wray in NY
Technology: Beaupre & Co., headed by Andy Beaupre in Portsmouth, NH.

Which ones are new?
The Rx Mosaic Health practice is new. Mosaic has already experienced tremendous success, bringing in new clients and doubling staff in the past six months.

In early 2006 Brodeur created Strategic Planning, headed up by EVP, Jerry Johnson. This team is focused on the research, planning and creativity that goes into all client programs. The philosophy and operating principles are based on research, results and ROI. Brodeur makes it central to every client program to develop a unique customer insight and point of view that drives our program approach, investing heavily in research in order to gain a grounded perspective.

Brodeur also formed a partnership with digital communications Agency, Echo Ditto, rounding out our Digital Communications expertise. The Pearl Harbor Survivors Project, an online initiative born out of an urgent need to honor those who lived on, is one of the projects from this alliance. Its aim is to engage younger generations in the preservation of survivor stories so that generations to come may understand and appreciate the sacrifices made at Pearl Harbor. The Project generated nearly 300 survivor stories, contributed to significant increases in individual giving, reached a 100m + national radio audience, a 10m + TV audience and 10m impressions on CNN Headline News alone.

The Social Entrepreneurship functional practice is also new. A culmination of Corporate Social Responsibility, For-Profit initiatives and a passion for community service and PR strategy skills, the Social Entrepreneurship practice is led by Brodeur NY veteran, Judy Feder. She has already begun working on "for-benefit" initiatives such as Arzu, a new venture that enables Afghan women to support themselves and their families through traditional rug-weaving, The Good Deed Foundation/Women's Funding Network partnership, and BCmets.org, a free listserve for patients and families living with metastatic breast cancer.

Brodeur has a long history as technology practitioners. This heritage has evolved to play important roles in two new functional practice areas: Mobility and Clean Technology.

By Mobility we mean the specific delivery of content to mobile devices. Brodeur brings over a decade of experience in consumer technology into this emerging business platform and has partnered with The Yankee Group to examine how the delivery of "snack sized" content to the third-screen is impacting the communications industry. Brodeur is working with clients in the travel and online industries to take advantage of this "always on" relationship between a consumer and a brand.

Building on its heritage for understanding technology, Brodeur has launched its clean technologies practice. This innovative group is helping clients make sense of the current landscape for alternative technologies. Our group of communications professionals is counseling clients on the best way to integrate and communicating effectively in today's marketplace and educate on the need for action on important global issues, such as global warming and sustainability.

Of those, which ones are part of the core strategy of the agency?
Our core strategy for Brodeur is to provide clients with the right needs and resources at the right time. This involves putting the client at the center of a circle of seasoned professionals across multiple disciplines that can bring a more holistic and brand-centric view to our clients.

In this fast-paced, Web 2.0 world, we view Strategic Planning, Digital Communications and Social Entrepreneurship as priority areas for enhancing our clients' relationships with their customers.

Which practice areas have been phased out in the past year?
We are continuing to enjoy strong growth throughout all of our practices but we have integrated client categories like Financial Services into the practice area in which they should reside - Consumer Marketing for consumer-facing brands and Business-to-Business for direct-to-business brands.

What practice areas showed the most growth? Please elucidate.
Our consumer marketing practice continues to grow as Brodeur becomes known for its expertise in helping clients to navigate the new world of social and mobile media. In addition to the Practice's core specialty in consumer electronics (current clients included RIM, Toshiba and Memorex/Imation), the Consumer Marketing Group has deepened its entertainment/lifestyle portfolio with clients like American Express, Starz Entertainment Group and The History Channel. Brodeur has also launched a third specialty area for the Consumer Practice in Mobility with anchor clients like RIM and in B2B with clients like DiBcom (mobile TV chips), Trimble Outdoors (GPS software for mobile phones) and supporting long-time client, Avnet's new mobile enterprise practice.

2006 was also a strong growth year both organically and in terms of new business in our business-to-business practice with a strong focus on lead-generating special projects and increased interest in digital communications among existing clients like Avnet, Corning, PerkinElmer, Hughes and LabCorp, as well as new additions to the Brodeur client roster, including Vectron International, RWD Technologies, the Pearl Harbor Memorial Fund and Trimble Navigation.

Which practice areas showed the least growth? Please elucidate.
For many years, Brodeur was known as a technology PR firm. While technology continues to be a strong part of our heritage and a core part of our business, it is no longer a single focus. Our understanding of technology has allowed us to diversify our business into other areas such as clean technology and mobility.

What is the distribution of accounts across practice areas?
Over half of our business resides within the Business-to-Business practice. Consumer Marketing currently makes up another quarter and the rest is healthcare and social marketing.

Accounts
What key account wins did you have in 2006? If based outside the US, or are global, please state regions.
Brodeur
AmericanExpress
The Pearl Harbor Memorial Fund
RWD Technologies
Vectron International
Abiomed
AppForge
Seoul Semiconductor
Trimble Outdoors
Imation (expanded Memorex account/won new brand)
The 41st Parameter

Rx Mosaic Clients:
CV Technologies / COLD-fX
OrthoNeutrogena, a Division of Johnson & Johnson / EVOLENCE
Schering AG, Germany / Sargramostim
Sepracor, Inc / Brovana
Sepracor, Inc / Lunesta
Sepracor, Inc / Xopenex
Teva Neuroscience / COPAXONE

Of your 2006 wins, how many were across three or more countries?
We had six new multi-national business wins.

What key accounts did you lose in 2006? If based outside the US, or are global, please state regions.
Brodeur continues to enjoy long-lived relationships with all of our top-tier accounts and the average length of our client relationship is five plus years. We are proud to say we did not lose any of our key accounts this year.

Did you expand any existing accounts into new domestic or international markets or sectors? Please elucidate.
Avnet continues to expand internationally with project work in Europe and Asia, as well as additional sectors of the business being supported in the U.S.

What proportion of your clients are on a retainer?
The large majority of our clients are retainer-based.

Has this changed over the past year?
We are doing a great deal more project work in and around our Strategic Planning function. We did 30 unique assignments on positioning and messaging and executive training work in 2006. About one-third of our Strategic Planning work was project based outside of retainer based relationships and about half of that work led to retainer business.

One example would be RWD, a professional services company who came to us to help them brand an updated version of a new product for the enterprise market. An intensive research project revealed that customer perception of the company was not in line with the performance support the product offered and we created a new name: uPerform. The dramatic change of messaging and subsequent success of the launch has led to an ongoing relationship with RWD.

Performance

What was your 2006 global (including US) revenue?
Agency declined to give information

What was the % change over 2005 global revenue
Agency declined to give information

What was your global profit margin in 2006?
Agency declined to give information

What was your 2006 US revenue?
Agency declined to give information.

What was the % change over 2005 US revenue
Agency declined to give information

What was your US profit margin in 2006?
Agency declined to give information

Did you experience top-line or bottom-line growth in the past year, or both? Please elucidate.
We met our 2006 expectations by achieving both top-line and bottom-line growth. Unfortunately, due to SEC rules and Omnicom policy, Brodeur can not elucidate beyond this statement.

How much of your growth was organic, and how much was due to new business won?
We secured a healthy amount of new business wins in 2006 and 70 percent of that was proactively driven. Brodeur |Pleon has always focused first on client satisfaction and 2006 was no exception, about one-third of our new business growth was organic.

How did your performance, in terms of revenue and growth, meet expectations you had for the year? Please answer this even if you have not submitted revenue figures, including any information that characterizes your 2006 performance.
We have met or exceeded our global expectations. In the US, we have seen growth in our consumer business, partly in consumer electronics with long-time clients like Toshiba, but also in the entertainment sector through such clients as The History Channel, Starz Entertainment Group and Discovery Communications. Our growing reputation as a consumer marketing company has also led to some exciting new work with American Express and Orbitz.

Our B2B group continued to thrive in 2006, particularly in the area of global corporate communications programs for long-time clients Corning Inc., PerkinElmer, Worldspace, efunds and Avnet. Additionally, Brodeur B2B saw growth in new integrated communications assignments for companies like Abiomed, LabCorp, Vectron International, Elster Group, IKON Office Solutions and AppForge.

The Brodeur | Pleon Worldwide Network continues to grow. Emerging markets are also showing promise for us particularly in Eastern Europe where we're seeing growth in terms of more advanced business services with the expansion of the EU to include Turkey and most recently, Romania and Bulgaria. India and China continue to be key priority areas for us; as well as emerging markets like Vietnam where we established a new partnership a week after Vietnam joined the WTO.

Please briefly outline any initiatives undertaken in 2006 that add to your agency's story, such as staff development/training, fundraising/charitable initiatives, community programs, business partnerships, etc.
Staff Training
At Brodeur we've always viewed our employees as our most important asset and 2006 marked the 12th year of Brodeur's Professional Development Program. We've had an on-site PD trainer involved with the management of our program for over a decade and believe that Brodeur has the most advanced employee development program around. The longevity of our staff -- especially among senior leadership who have risen "through the ranks" -- is a testament to this program. The average length of employment at Brodeur for GM-level and above is 7 years.

This year we started two new team and individual leadership programs that included executive coaching and the use of personality assessment tools. The DISC Personality System and the Personal Interests, Attitudes and Values (PIAV) self assessments improve leadership and team members' self awareness and communication skills. The DISC categorizes behaviors in four areas (Drive, Influence, Steadiness, and Compliance) and helps individuals recognize where they are adapting their natural styles to their work environments. It highlights areas for improvements and helps them understand their strengths and how their behaviors might be perceived by their colleagues. Just as the DISC describes behaviors, the PIAV helps individuals better understand their personal interests, attitudes and values and how their beliefs might differ from those around them. We've already used these tools to create a new process for evaluating the skill sets within the organization to better understand hiring requirements and succession planning.

This year's Profession Development program was focused on continuing our learning culture through proactive and opportunistic training sessions. From deeper thought leadership, to in-depth Analyst University days with employees on the subjects of new media and mobility, the PD program has renewed employee focus on critical management skills and facilitated deeper thought leadership.

Charitable Initiatives
Our employees continue to rally support for the survivors of Hurricane Katrina. Brodeur engaged with a half dozen other Omnicom companies to support "Making Change for Katrina," a national program with CoinStar that encouraged people to donate their spare change around the house to hurricane victims. The proceeds went to Habitat for Humanity and Brodeur supported the online efforts and publicity for the program.

Brodeur employees get paid community service hours each year and Habitat for Humanity has been a long-time recipient of many employees' efforts. We do an annual Habitat for Humanity day in Boston and we have also had team members donate their time to Habitat for Humanity in New Orleans.

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