Skilled at networking

For agencies, an independent network can provide ballast. For clients, it can open up doors all over the world.

For agencies, an independent network can provide ballast. For clients, it can open up doors all over the world.

Rockwell Automation was looking for a way to make its European PR operations run more reliably. A mishmash of unaffiliated firms spread across the continent was not providing the consistency the company had come to expect from its agency Padilla Speer Beardsley (PSB) in North America.

"One of our challenges is that in Europe, we really needed to increase our visibility," says Matt Gonring, VP of global marketing and communications.

So the $5 billion Milwaukee-based company and Minneapolis-based PSB decided to leverage the agency's membership in Worldcom, one of several networks of independent agencies that give members the ability to work like a global firm, yet still preserve their independence and identity.

"These networks have formed out of a matter of necessity," says Eric Mower, CEO of Syracuse, NY-based Eric Mower & Associates, a member of agency networks IPREX and IN. "You need capacity in different regions and access to different resources. But the overarching need has been independent agencies' need to stay competitive, particularly as they're often locked in a fierce battle with [global agencies] for business."

Rockwell has worked with PSB for 18 years, and Gonring says the agency has the right combination of size and quality. But he wanted to find a European agency partner that could work seamlessly with PSB, without having to always go through Rockwell. Worldcom enabled Rockwell to work with a handful of member firms in Europe, with London-based Kaizo as the coordinating agency.

"We chose this approach because we liked the close ties to [PSB] in the US," says Gonring. "We liked that there was a lead office making sure everything is coordinated."

With global firms, there's no guarantee of consistency across offices in a region, says Gonring. But with a network, Rockwell could pick and choose its partners.

As independent agencies face growing competition, being able to provide multi-market support is essential, says Matt Kucharski, an SVP at PSB and current chairman of Worldcom's Americas region. And networks provide geographic scale while allowing agencies to remain independent.

But Worldcom does not market itself, or try to pitch business, to clients. The member agencies pitch the business and present Worldcom as a strong component of their offering.|

Using a network was also an appealing option for Denver-based Frontier Airlines. It relied on Pinnacle Worldwide for crisis communications; all other communications are handled in-house.

"When you utilize a global agency, you have a big administrative overhead you're paying for," says Joe Hodas, Frontier's corporate communications director. "We're able to work locally, but leverage a national presence and tap into crisis communications and airline experience."

Such networks are not just about geography or mimicking global firms' reach, adds Kucharski. It's also about industry expertise.

And that is what GlobalFluency is about. The network of tech-centric agencies doesn't present itself as a network, says Donovan Neale-May, managing partner of GlobalFluency, and president of Neale- May & Partners, based in Palo Alto, CA. Instead, he says, it presents a single brand identity.

"We don't want the client to think it's hiring five or six different firms," Neale-May adds.

"And the agencies are getting more than an affiliation. They're getting stronger integration and the chance to compete for business they normally wouldn't be able to go after."

At Pinnacle, the key to success is highlighting the strength of local agencies, not as a one-size-fits-all global entity, says Ron Hanser, Pinnacle global president, and president and principal of Des Moines, IA-based Hanser & Associates. But it does work to benefit all members, regardless of how they pitch, when it comes to research or developing new products, such as word-of-mouth marketing.

Yet a network is as only as good as its members and, thus, is quite particular about who joins. At Pinnacle, all potential members are scrutinized and must be sponsored by an existing member agency. They must submit financial information, as well as more qualitative information about their position in their respective market.

After a formal presentation to the board, admittees must pay a joining fee, as well as annual dues, and participate in network meetings.

For GlobalFluency, it's about deep-domain experience in technology. And Worldcom requires all agencies to submit to a review every 18 months, says Kucharski.

"We've had to ask agencies to leave because they didn't pay their dues or didn't participate or didn't meet other requirements," he says. "We want to make sure we have the right coverage, geographically and by industry. We need to make sure we have the right partners."

And it's that selectiveness that can ensure survival for many firms.

"With so much M&A activity, you have the big global firms and then a handful of independents," says Hanser. "It's about being able to compete and win."


AGENCY NETWORKS

Pinnacle Worldwide
Age: 30
Network leader: Ron Hanser, global president
Number of agencies: 57
Number of countries in the network: 31
Number of clients: About 1,700
Annual revenue: $190 million
Sample clients: Rouche, GlaxoSmithKline, Target, Cigna, Shell Oil
Specialties: Crisis communications, healthcare, public affairs, IT

Worldcom Group
Age: 18
Network leader: John Holt, chairman of the board
Number of agencies: 98
Number of countries in the network: 33
Number of clients: About 100
Annual revenue: $183.76 million
Sample clients: Bausch & Lomb, Ernst & Young, General Mills, Harrah's Entertainment, Johnson & Johnson
Specialties: Consumer, technology, healthcare, financial services, public affairs, crisis communications, travel and tourism

GlobalFluency
Age: Three
Network leader: Donovan Neale-May, managing partner
Number of agencies: 53
Number of countries in the network: 72
Number of clients: 436
Annual revenue: $39.2 million
Sample clients: McAfee, Visto
Specialties: Perception management, demand generation, research and global intelligence, creative and digital services

PROI (Public Relations Organisation International)
Age: 36
Network leader: Jean-Leopold Schuybroek, president
Number of agencies: 38
Number of countries in the network: 25
Number of clients: More than 2,000
Annual revenue: $170 million
Sample clients: Delta Airlines, Coca-Cola, Deloitte, Orkin
Specialties: Generalist (IR, healthcare, consumer, public affairs)

IPREX
Age: 23
Network leader: Kathryn Blanchard, president-worldwide
Number of agencies: 46
Number of countries in the network: 23
Number of clients: More than 800
Annual revenue: Not disclosed
Sample clients: Administaff, Bank of America, Bosch, Freddie Mac, Nestlé, Susan G. Komen Breast Cancer Foundation, travelocity.com
Specialties: Full range of PR and marketing communication including automotive, crisis management, defense/security, financial services, food and beverage, nonprofit and real estate

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