Agency Strategy: New Labour no threat as Bell chases growth - After years of close links with the Tory Party and the departure of Neal Lawson and Ben Lucas, Lowe Bell is adapting to New Labour’s New Britain with an ambitious acquisition strategy

The last couple of months have not been easy for Lowe Bell. First Lowe Bell Financial was on the wrong side of the bid to break up the Co-op - as adviser to Andrew Regan’s investment trust Galileo.

The last couple of months have not been easy for Lowe Bell. First

Lowe Bell Financial was on the wrong side of the bid to break up the

Co-op - as adviser to Andrew Regan’s investment trust Galileo.



More seriously, according to its competitors, the agency was on the

wrong side of the election campaign. Many of its top people had high

profile roles in the Conservative campaign - not least its eponymous

chairman Sir Tim himself .



The departure, announced last week, of two of the best-known New Labour

figures from Lowe Bell Political - Neal Lawson and Ben Lucas - provoked

a spate of predictions from competitors claiming the agency would find

itself frozen out by the new Government. The simultaneous announcement

that the company had bought lobbying firm, the Russell Partnership, was

met by a resounding ’who?’.



But before we write Bell off, it is worth considering that seven years

ago he was said to be washed up politically. By last summer he was back

as one of John Major’s key advisers.



Bell himself rejects the idea that the only people who will be able to

lobby the new Government are Labour insiders. Most lobbying is done in

order to change Government policy, he says - ’You don’t hire lobbyists

to compliment the Government on how good its policies are.’ Neither do

you want them to be selling the Government’s policies rather than those

of their clients.



Bell also makes the point that working with Labour in Opposition is very

different from working with them in Government. And of other lobbying

firms he says: ’We’re all in the same situation.’



And yet there is no doubt that he is sensitive to charges that Lowe Bell

is too associated with the Tories - to the point that he has conducted

an audit of Labour contacts within the agency. He also admits that the

low-key and essentially apolitical profile of his latest purchase, the

Russell Partnership, was part of its attraction. ’We will have to make

some minor adjustments,’ he says, and promises to announce two Labour

hirings soon.



Of course Lowe Bell Political is just one of nine companies within the

mighty Lowe Bell empire. At around 15 per cent of total fee income, it

is nowhere near the largest. And yet the question of Bell’s own

political profile and influence are key to the agency in a way they are

not for Lord Chadlington - another member of Major’s kitchen cabinet -

and his company Shandwick.



Bell is adamant that he does not want to turn Lowe Bell into a branded

shop. He believes firmly that: ’these businesses need a figurehead,

somebody the outside world and clients can identify with’. This, along

with the sheer power of his personality and his evident enjoyment of the

political limelight, ensure that as long as he is around coverage of his

business will focus on him.



Of the rest of the senior management team, perhaps the best known is

Piers Pottinger. However, he has his hands full with Lowe Bell Financial

where the departure of Terry Collis last year and, more recently, the

news that deputy chairman Jem Miller is to retire have left the agency a

little thin in the ’grey hair’ department. Even if the agency has found

the senior figure it said it would look for when Collis went, the signs

are that they will come in as deputy chairman, rather than chairman as

originally intended.



The need to bring more managers into the business and provide another

focus apart from Bell provide some explanation for the company’s stated

intention to buy another major well-known brand. Negotiations are

believed to be underway with at least one top 30 independent UK

advertising agency, although M&C Saatchi has been ruled out.



Such a move would, insiders suggest, be a natural extension of the

group’s services as well as providing a solution to one of Bell’s

biggest frustrations - his failure to move the share price. Despite

impressive financial results - a 21 per cent increase last year in both

operating income, to pounds 22.5 million, and operating profit to pounds

3 million - parent company Chime’s share price is now languishing at

38p, two pence above its introductory price in 1994.



The truth, according to Bell, is that with a market capitalisation of

pounds 22 million, Chime is just too small to attract much of a

following. Market watchers believe his aim should be to at least double

the size of the business.



Bell again dismisses rumours of a merger with Shandwick, which surfaced

in February after UK Active Value Fund added a five per cent stake in

Chime to its existing 15 per cent holding in Shandwick.



Yet, the group is undoubtedly very active with the acquisition of the

Russell Partnership, a prime example of Bell’s strategy of growing

existing businesses by buying in good people and clients. Russell may

not be the most dynamic lobbying firm - its client list has hardly

changed in five years - but it comes with an excellent monitoring

operation, some good clients and Westminster office space.



Mindful, perhaps, that Lowe Bell has been weak in terms of international

coverage, Bell has been active on that front. After backing away from a

deal with Adamson Associates in Brussels, he has now signed a joint

marketing deal with European lobbying network EPPA. A lacklustre

start-up in the US under Alan Capper has also been scrapped in favour of

an equity stake in local firm The Torrenzano Group.



In the UK, the company is believed to be looking at acquisitions in

sports and entertainment PR. At the other end of the spectrum, Bell

confirms he is keen to move into the corporate strategy business - which

he describes as a kind of half-way house between communications and

management consultancy.



With such activity, it seems PR’s great survivor intends to be around

for a while yet.



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