2006 Agency Business Report: CKPR

Joel Curran, managing director, CKPR

Joel Curran, managing director, CKPR

Name of parent division/company (enter both where applicable)
Cramer-Krasselt

Name of person, if any, the most senior person named above reports to
Peter Krivkovich, CEO, Cramer-Krasselt

Did you make any senior hires in 2005 (VP and higher)?
Cathy Yingling, vice president (Zeno Group). Co-founded "Speaking Female" practice at Zeno.
Hugh Williams, vice president (Weber-Shandwick)
Lori Cuonze, vice president (Arnold)
Greg Goldscholl, vice president, (Edelman)

What senior staff have departed the firm?
Paige Peldo, vice president

Other senior management changes
Dan Pooley
, formerly svp/director of Chicago, promoted to director of strategic planning, CKPR corporate

How many offices do you have globally?
North America
Chicago, New York, Milwaukee, Orlando, Phoenix

Is there a particular region, US and globally, that is growing right now?
Midwest (over 50% in 2005)

Is there a particular region, US and globally, that's shrinking?
Not in our world

How many practice areas do you have?
Three core practice areas – Consumer, Reputation Management and B2B, with 29 focus areas *
* We're really moving away from traditional practice areas and more into demographic focused practices. Females of all ages (teens, working girls 25-25, moms, boomers) are most popular among our clients, followed by Boomers.

Of those, which ones are part of the core strategy of the agency?
Brand Planning
Integrated Services

What practice areas showed the most growth?
Consumer Healthcare and Crisis Communications.
We handled Hurricane-related communications for Florida Power & Light, VISIT FLORIDA, Celluar South (largest privately held wireless communications provider in the US)

Which practice areas showed the least growth?
B2b

What is the distribution of accounts across practice areas?
Consumer -- 65%, Reputation Management – 25%, B2B – 10%

What key account wins did you have in 2005? Whirlpool, UNO Chicago Grill, General Mills (various brands), Nicorette, Polident, Sensodyne, GE Healthcare, Kohl's (department stores), CareerBuilder.com, Florida Power & Light, The Little Gym, Wellcare, Eckerd Youth Alternatives, Blue Cross Blue Shield/Arizona

What key accounts did you lose in 2005?
Acco Office Products (resigned – too small), Au Bon Pain (client went in-house), Outer Banks of NC (contract change), Westcorp Shopping Centers (took in-house), VISIT FLORIDA (project ended)

Did you expand any existing accounts into new domestic or international markets?
Through C-K, CKPR is part of iCOM, an international affiliation of independent, integrated agencies. In 2005, we took several clients internationally through our iCOM affiliates – all in Europe (but are unable to disclose at this time since all are launching new products or services therein 2006).

Did any dormant clients start to spend with you again?
Nothing significant.

What proportion of your clients are on a retainer?
30-50% (depending on how "retainer is defined)
In the strictest definition, 50% of our clients are on some type of retainer. Most of those are our largest revenue generators through procurement-driven contracts. Many "retainers" are actually the way our clients have taken project fee estimates and rolled them up into one "retainer" that they pay. We have reconciliation agreements with each, meaning revenues can go up with hours rise above estimates.

Has this changed over the past year?
Yes. As we've moved up the client/brand food chain, we're seeing more procurement-based contracts that may cover multiple brands or business group within a client organization.

What was your 2005 US revenue?
$13.3 million

Record year for C/K and we have increased the percentage of revenues we contribute to C/K, establishing PR as a growing and more significant part of the integrated agency.

What was the % change over 2004 US revenue
24%
Largest jump in our 4 years of operating as a separate P&L from C/K. All offices recorded double-digit growth

Did you experience top-line or bottom-line growth in the past year?
Both

How did your performance, in terms of revenue and growth, meet expectations you had for the year?
Our revenue growth exceeded expectations.All offices grew. Each of our five offices produced double digit growth, and added quality clients and budgets.

Our Strategy Amplified, media-neutral approach continues to be validated by major brands. We added several major brand relationships to our roster, bringing with them larger budgets and the opportunity to expand project relationships into multi-project annual budgets, and to expand retainer relationships beyond our initial entry point brands.

Brand Planning through PR is growing. We're seeing a huge increase in the number of clients who accept that BP, and research to set benchmarks and validation, are integral to any communications plan.

PR-led integration is working. As we are part of an integrated agency (C/K), it is not a mandate that we open doors for other agency services. But, considering many of our growing CKPR offerings are rooted in C/K (e.g. Brand Planning, Digital/Web-based word-of-mouth, promotions), we are leveraging our full agency 360-degree thought-power to bring our clients the best ideas – regardless of what discipline they come from – that help build brands.

Brand managers lost in traditional agencies are seeking CKPR for refuge. Each office was able to add key staff that bolstered our counseling expertise and creativity, and continued to enhance our profile.

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