MSLGroup: Agency Business Report 2014

MSLGroup saw slight single-digit revenue growth globally and flat revenue in the US in 2013, missing expectations for the year.

Principals: Olivier Fleurot, CEO (pictured); Paul Newman, president, North America
Ownership: Publicis Groupe
Group agencies: Kekst and Company, PBJS, Publicis Consultants, and Qorvis MSLGroup
Offices: Global: More than 100 wholly owned; US: 15
Revenue: Global: $450 million to $500 million; US: $150 million to $200 million
Headcount: Global: 3,400-plus; US: 629

MSLGroup saw slight single-digit revenue growth globally and flat revenue in the US in 2013, missing expectations for the year. The agency cited a weaker-than-expected economy, particularly across Europe, for the disappointing year.

"When the euro is suffering, it has a big impact on our business," says MSLGroup CEO Olivier Fleurot.

In its Q2 earnings report, parent company Publicis Groupe attributed a slight dip in revenue in the period to "weak performance" in PR activity in North America.

Around the world, the agency saw its strongest growth in Abu Dhabi, Dubai, Canada, Brazil, and Greater China, in that order. Its Los Angeles office also fell short of expectations. The best performing locations in the US were Boston, Chicago, and San Francisco.

"Overall, it was a decent year, but a disappointing one in certain parts of Europe in terms of business," says Fleurot. "We had a few changes, hiring a new president – Paul Newman – for North America. We continued to have good growth in many markets, such as China, a very good year in Canada, Brazil, Poland, and a few other European countries."

Lucrative account wins
In terms of business wins, the firm won Huawei’s business in India, expanding work with the company to five markets.

It won Mexico’s lucrative tourism communications business and in May 2013, won the international AOR account for Emirates Airlines, and North America AOR for PayPal. However, the agency lost communications duties for Procter & Gamble’s homecare brands Swiffer, Mr. Clean, Dawn, and Cascade in North America to Citizen Relations.

The final part of the year and early 2014 were also periods of rapid change. Former North America president Renee Wilson stepped back into the chief client officer role and the firm brought on Newman, formerly of eBay, to fill the position.

Meanwhile, the agency made waves in the nation’s capital by acquiring public affairs specialist firm Qorvis Communications in January 2014 and renaming the shop Qorvis MSLGroup. As part of that process, Michael Petruzzello was named president of the rebranded firm and North American public affairs director.

"The acquisition in DC gave a real boost to our business," Fleurot adds, as "we were now able to offer many new services."

While the agency, Publicis’ flagship unit in PR, is awaiting the finalization of the merger of its parent company with Omnicom Group, it does not expect major changes in the holding company’s communications structure.

Fleurot did not disclose specific figures, but said profitability "remains at a healthy double-digit margin."

The firm did see "significant" revenue growth in Canada, Brazil, and China, driven by new business wins and organic growth, as well as its acquisition of Espalhe in Brazil, which brought the agency new offices in Rio de Janeiro and Sao Paulo. Although MSL already had an office in Rio, the firm says the additional outpost there will boost its network prior to the 2016 Olympic Games.

The firm is in the process of closing the Carré Noir office in Turin, Italy, and closed the Emotion experiential Asian office in 2013. The agency formally added technology as a global practice, as well as its corporate and brand citizenship unit.

MSLGroup named Shellie Winkler North American chief strategy officer.

Key senior hires in 2013 included chief talent officer Maree Prendergast, Midwest MD Brad Wilks, and SVP and practice lead Linda Recupero in New York. However, the firm lost New York MD and SVP Joel Curran, also the former leader of its Chicago office. Amanda Glasgow, former consumer SVP, left for Edelman.

Other departures included former New York SVP Elise Titan and Asia social and digital lead Gaurav Mishra. Former corporate SVP Peter Harris left to become US CEO at Grayling.

The firm maintained a global staff of about 3,400, but turnover was 29.1%.

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