Update: PR outperforms group at IPG in Q3

NEW YORK: Revenues at Interpublic Group's PR division outperformed the overall group in Q3 2010, increasing 11.4% year over year to $261.5 million.

NEW YORK: Revenues at Interpublic Group's PR division outperformed the overall group in Q3 2010, increasing 11.4% year over year to $261.5 million.

Overall Q3 group revenue increased to $1.56 billion from $1.43 billion in 2009, a 9.4% increase.

IPG's Constituency Management Group includes PR agencies Weber Shandwick, GolinHarris, Jack Morton, Future Brand, and Octagon.

Harris Diamond, CEO of Weber Shandwick and CMG, added that PR is driving much of the growth within the group; on a like for like basis, PR was up 6.4% from the nine months ending September 30 and Q3 revenue was up 6.7%.

Not surprisingly, Diamond said that digital has driven much of the growth within CMG, again, particularly within its PR agencies.

“Social media has become day in and day out part of what we do,” he noted, adding that CMG approaches digital from the perspective of an "inline world," recognizing that consumers' offline and online activities inform each other. “For the first time in my career- the technology by which people receive info is playing to PR's strong suits.”

Additionally, Harris said, that CMG's growth is helped by the fact that the events business, which was severely affected by the recession, has bounced back significantly. However, he conceded, that it may still be a while before revenue is back to 2007 and 2008 levels, which were the best performing years in recent memory.

IPG's Integrated Agency Networks, which includes McCann Worldgroup, Draftfcb, Lowe, Mediabrands, and its domestic integrated agencies, reported $1.299 billion in Q3 revenue, a 9.0% increase over last year.

“The unique skill that PR brings is that we know how to engage the consumer in ways that they don't view it as advertising," he added. "I think the proof is that [PR] is growing faster than [other disciplines]." 

Michael Roth, IPG chairman and CEO, said during a conference call that, while the first nine months are encouraging, there is still some uncertainty going forward. For new business he said there has been a fair bit of activity for the year and that the pipeline is solid across all disciplines.

In the US, IPG achieved organic growth of 10% in the three months to the end of September. Group revenue was $4.52 billion in the first nine months of 2010, compared to $4.23 billion in 2009, an increase of 5.2%.

Third-quarter operating income was $100.2 million, up from $58.3 million a year ago.

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