Weber Shandwick: Agency Business Report 2006

The juggernaut

The juggernaut

WS is well positioned to maintain its status as the preeminent global behemoth in the PR world.

The agency's broad cross-section of new account wins points to strength across its multitude of practices, and an ability to draw a diverse range of new business. Further, the decision of many clients to invest more in order to broaden the international scope of their programs can only bode well for WS, whose ability to execute campaigns in every continent can be matched by few other agencies.

"Our deep practice area expertise and our global footprint are often cited as differentiators when we talk with clients," says president Andy Polansky.

The firm is already heavily invested in the current hot markets, China and India, and its combination of affiliates and owned offices in Eastern Europe means it is well positioned to take advantage of anticipated growth in that underserved area.

Interpublic Group, which has been plagued by accounting troubles, client losses, and defections of key personnel, cited the performance of WS as one of the bright spots in the stumbling holding company's 2005 results. The fact that multicultural communications and Web relations – arguably the two most forward-looking practices in all of PR – were cited as particularly strong indicate that WS is working to stay ahead of the curve even as it grows, along with the rest of the industry, in what is perhaps the most positive business climate since the end of the tech boom.

Harris Diamond's role as head of IPG's Constituency Management Group allows the firm to tap into global resources across disciplines, and move into new markets, such as those in Eastern Europe.

"We'll take advantage of IPG anywhere, anytime there is a client need," he says. Public affairs was one area that did not find the same pace as the other practice areas this year, though government contracts both in the US and abroad did increase.

The agency's principals, long known for their unwavering optimism about the firm's prospects (even while its detractors predicted failure), are newly energized by their deepening global footprint.

"It used to be that business would almost always be hubbed out of a major city," Polansky says. "But now we are looking at hubs like Brussels, Beijing, Cologne. That's been an interesting development, and it speaks to the depth we have in our offices around the world."

Name of parent division/company
The Interpublic Group of Companies

Name of subsidiary companies:
N/A

Has your ownership status changed in the past year?
No

Name of global CEO:
Harris Diamond

What is your current headcount, and how has it changed from this time last year?
We do not release this information in compliance with our parent company's policy.

What was the percentage of staff turnover?
We do not release this information in compliance with our parent company's policy.

Did you make any senior hires in 2005 (VP and higher)? Please state name, title, and previous company.
A representative sampling includes:
Paul Jensen, general manager of the New York office and executive vice president of the office's corporate practice (Euro RSCG Magnet)

Tim Marklein, executive vice president and general manager, Northern California (Hewlett-Packard)

Robert Dowling, executive vice president and director of the technology practice in the New York office (Cohn & Wolfe)

Kim Metcalfe, senior vice president, corporate affairs group in Chicago (Edelman)

Katie Huang Shin, senior vice president, technology in San Francisco (Horn Group)

Ian Bailey, managing director of our UK financial communications agency, Weber Shandwick | Square Mile (Financial Dynamics)

Lucie Harper, deputy managing director of the London healthcare practice (Shire Health London)

Baxter Jolly, managing director of the Singapore office (GolinHarris)

Other senior management changes include:
Rolf Olsen
was promoted to CEO of Weber Shandwick in Europe

Sally Ward was promoted to vice chairman, Weber Shandwick in Europe

Josep Catlla was promoted to CEO of the Brussels office

Roberto Ferrigno was appointed director of the corporate practice in Brussels

Michelle McGlocklin was named chair of the European technology practice

John Russell was transferred to the new position of executive vice president, Asia Pacific, and is responsible for the regional corporate and public affairs practices

Ning Shao was appointed managing director of Powell Tate | Weber Shandwick in China

Walter Hueber was promoted to vice president and strategy director of the Beijing operation

What senior staff have departed the firm? Please state name and previous title
Jamie Parker, president of technology practice, New England.



Have you made any acquisitions in the past year, or merged with another agency?
No

How many offices do you have globally?
More than 75 owned offices in 38 countries and affiliates that expand the network to more than 100 offices in 65 countries. See attached for list of offices.

What offices opened in 2005 or early 2006?
We will be opening an office in Miami in the spring.

Is there a particular region, US and globally, that is growing right now? Is there a particular region, US and globally, that's shrinking?
Overall, performance in North America is very strong and we have had a year of healthy growth with particular strength in New York, California, Chicago and Minneapolis. Weber Shandwick also experienced good year-on-year growth in UK and nearly all Continental European markets. In particular, we saw strong performance turnarounds, under new leadership in Germany, Brussels and Switzerland. In Asia Pacific, we have experienced solid growth in all key markets, and our operations in China have grown extensively.


How many practice areas do you have?
26

Which ones are new?
Broadcast media services

Which practice areas have been phased out in the past year?
None

What practice areas showed the most growth?
Overall, Weber Shandwick's consumer marketing, financial services, healthcare, multicultural communications, technology and Web relations practices are expanding in the US and around the world.

What key account wins did you have in 2005? (Please exclude non-US business)
Ace Hardware
American Financial Services
BEA Systems
Celgene
Centers for Medicare and Medicaid Services
Clorox (multiple brand assignments)
Disney Publishing
DYMO (division of Newell Rubbermaid)
Freescale
Genentech
GlaxoSmithKline
Global Food Technologies
KFC
Message Labs
Microsoft Mobile and Embedded Devices
National Headache Foundation
Network Appliance
Olive Oils from Spain
Raytheon
Reliant Pharmaceuticals
Serono
Susan G. Komen Breast Cancer Foundation
SPX Corporation
US Army
US Department of the Treasury
What key accounts did you lose in 2005? (Please exclude non-US business)
Regional work for Dunkin' Donuts and Unisys.

Did you expand any existing accounts into new domestic or international markets?
We have seen a substantive increase in multinational engagements. This is one of the more significant trends we have seen over the past year, and one that has had a very positive effect on our business. Existing accounts, which grew appreciably, included:

ExxonMobil
General Motors
Hitachi
Honeywell
MasterCard International
Masterfoods
Microsoft
Monster Worldwide
Nestlé
Pfizer

Did any dormant clients start to spend with you again?
Yes, we have seen a fair amount of this, but we don't feel it is appropriate, given client confidentiality, to offer any specifics.

What was your 2005 US revenue (as entered into the separately submitted Rankings Form)?
We do not release this information in compliance with our parent company's policy.

What was the % change over 2004 US revenue.
We do not release this information in compliance with our parent company's policy.

What was your 2005 global revenue (as entered into the separately submitted Rankings Form)?
We do not release this information in compliance with our parent company's policy.

What was the % change over 2004 global revenue. We do not release this information in compliance with our parent company's policy.
Did you experience top-line or bottom-line growth in the past year? We do not release this information in compliance with our parent company's policy.

How did your performance, in terms of revenue and growth, meet expectations you had for the year?
Our financial performance exceeded expectations both in terms of revenues and profit. We continue to see strong organic growth in our multinational client portfolio, and significant growth in healthcare, financial services marketing, Web relations and multicultural communications.

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