FEATURE: TOP 40 TECH CONSULTANCIES 2007

The combined income of the top 40 tech agencies grew by a solid 10 per cent in 2006. Alex Black reports.

The technology PR sector is booming. Yes, we’ve all heard this before, but it has emerged more diverse, confident and savvy from 2006. The combined fees of the top 40 UK tech PR agencies totalled more than £70m, showing ­solid growth of around 10 per cent.

The fact that 2006 was a good year suggests that the sector has now fully recovered from the downturn of a few years ago, argues Hill & Knowlton’s technology MD Mark Jackson.

‘Last year was the first time in ages that we saw decent budgets,’ says Jackson. ‘Between 2002 and 2005 we saw accounts moving between agencies, but many of the budgets were still fairly paltry. Now though, companies are putting serious cash back into PR.’

The reason for this, Jackson believes, is the strategic nous comms consultants can offer. Or, as he puts it: ‘Clients know we can shape marcoms campaigns through messaging.’

Interestingly, the increase in strategic work and the rise in budgets has something of the ‘chicken and egg’ analogy about it. PR agencies, sniffing bigger budgets, have had to offer more services; while clients, aware they are going to have justify spending an extra £5,000 to £10,000 a month, are asking for more results.

So the agencies are developing increasingly diverse and sophisticated options, all the time trying to keep up with developments in technology. The overall effect has been to accelerate the growth and diversification of the tech PR sector. And that divergence is not just into consumer brands.

Edelman’s European technology MD Jonathan Hargreaves is keen to highlight the work of the agency’s emerging science and technology division, currently working on briefs to promote the work being done by pharma multinational Astra Zeneca’s research & development team.

Some companies appear to be a little too eager to embrace the brave new world of Web 2.0.


Elia: ‘identify key
opinion formers’

‘Companies understand that consumers do much of their research online rather than in print, and some prospects have asked us for “online PR” that hits across the spectrum,’ says Cohn & Wolfe’s business and technology MD Gladys Elia.

‘My advice has always been to proceed with caution. You don’t need to target every blogger. You just need to identify influential media and key opinion formers for your particular products.’

 

Focused online campaigns

Weber Shandwick’s technology MD Michelle McGlocklin agrees there has been a rise in research into things such as social networking and online influencer programmes.

‘Companies are now interested in the line-of-sight to the customer,’ she says, ‘so online campaigns are becoming very focused on specific audiences.

‘Clients are starting to realise the value of identifying and reaching passionate advocates.’

There is no doubt that the web has become a powerful tool, and this is not going to diminish. The message from the comms experts is that brands should first learn how to listen to the online community, and then seek expert guidance on how to respond.

User-generated content increases exponentially year by year, and more service companies are setting up to make it easy for people to find their 15 seconds of fame.

While the vast majority of this will be mostly virtual flotsam floating in the web’s vast ocean, corporate online reputation is also becoming increasingly important. If someone can create a funny video in their front room for YouTube, a company should invest the resources necessary to make sure it is hitting the right online audiences.

Online content doesn’t just appear on the web of course, and 2006 saw a marked increase in mobile phone-based content.

Edelman’s Hargreaves says the launch of the mobile phone domain name ‘dotmobi’ last year will lead to more mobile internet content this year.

A glance at the figures in out Top 40 Tech table would suggest all is not as rosy as people are making it out to be: 12 agencies saw a dip in fee income, including top-placed Metia (see profile).

However, there is no sense of alarm. For some of those who have dipped, tech PR makes up a relatively small proportion of their fee income.

No reason to hit the panic button
Technology work accounts for half of Mulberry Marketing Communications’ fee income and its tech PR income dropped 13 per cent last year. But the agency’s overall fee income grew by more than a fifth to £1.3m – hardly an excuse to hit the panic button.

Similarly, Nelson Bostock Communications’ tech PR income dropped 29 per cent last year. PRWeek’s Top 150 PR Consultancies table (published last month) shows the agency’s overall growth slightly up, and our Top 50 Consumer table (PRWeek, 4 May) credits the agency with a 152 per cent leap in its consumer fees.

MD Lee Nugent makes no excuses for pushing the agency’s tech clients into the consumer tech arena, and he is already planning ways to make more use of his consumer specialists in 2007.

As is often the way in any sector of PR, the main concentration of tech agencies is in London. Only 14 of the firms listed are outside the capital, with only three of those – Freshwater in Cardiff, MC2 in Manchester and Ptarmigan Consultants in Leeds – outside the home counties or Brighton.

Only three of the agencies in the Top 40 Tech table do not feature in our Top 150 table, showing that the tech sector is holding its own in terms of well established, heavyweight agencies. The top 26 in the table pulled in more than £1m worth of tech fees in 2006, confirming H&K’s Jackson’s belief that serious budgets are at last being offered.

First-quarter results for 2007 indicate that the market is still healthy and the general consensus in the industry is that ‘cleantech’ – or ‘greentech’ – is going to be a big factor in 2007 and beyond. WS’s McGlocklin predicts tech companies that can demonstrate sustainability and longevity of their products will make a big noise this year.

If social networking and developing interactive content were key in 2006, then clean technology and consumer tech look to be the drivers in 2007.

Anecdotal evidence suggests this year will be even better than last, with clients spending more money on a wider range of services. This is backed up by a client survey undertaken by H&K, which suggests nearly half of budgets are on the increase. The tech market may be more vulnerable than others to unpredictable fluctuations, but business confidence is at a high, and that can only be good news for PR agencies.

Click here for the Top 40 tech consultancy table

WHAT IS TECH PR?

Producing a tech PR league table is getting harder. With every year, the definition of tech PR – and indeed the definition of ‘tech’ gets more muddled.

A semiconductor manufacturer is a tech company, but so is Apple and indeed, a firm that makes coffee machines. VoIP used to be regarded as tech, but think of Skype and you think ‘consumer tech’. And does analyst relations for a financial services company then become a tech PR brief if it is looking at online opportunities?

To a certain extent, PRWeek is relying on the industry’s definition of ‘tech PR’ holding true from agency to agency but, for now at least, this seems a reliable marker based on conversations the magazine has had with the sector.

However, as the boundaries continue to blur, the term ‘tech PR’ may become as old-fashioned and outdated as the concept of a PC with a monochrome monitor and acres of beige wires lurking in the corner of the spare bedroom. Watch this space…

 

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