SUPPLEMENT: TOP EUROPEAN CONSULTANCIES 1996; Cultural shifts

PR consultancies must balance individual cultural identity with a European overview. The state of the industry is as diverse as the continent itself as Kate Nicholas discovers

PR consultancies must balance individual cultural identity with a

European overview. The state of the industry is as diverse as the

continent itself as Kate Nicholas discovers



While Europe’s politicos struggle with the realities of creating a

consolidated European union, the public relations industry - fuelled by

strides in technology and demands from international clients - has found

itself facing a mirror pan-European dilemma.



As agencies such as Shandwick and the newly-dubbed Porter Novelli

International look to consolidate their branding across Europe,

differences in distribution systems, regulatory frameworks and cultural

values remind of the need for separate national identities.



Consequently, agencies walk a tightrope between unity and multi-

culturalism, particularly when selling their product to US and Asia

Pacific clients who would prefer to see Europe as a single manageable

entity.



Admittedly brands such as Nintendo, Nike, Coca-Cola and Pepsi are able

to cross cultural barriers, but the 1980s concept of global marketing

perpetuated by the Saatchis so successfully on behalf of British Airways

now seems somewhat naive. Outside of the homogenous youth and fashion

sectors, the situation is just too complex.



Cost alone is a factor. Clients from outside Europe frequently

underestimate the financial commitment required for a truly pan-European

campaign. ‘We all suffer from clients who come in and say we want the

whole of Europe. People from outside Europe don’t understand the costs

involved,’ says Jennifer Potter, head of Charles Barker International

Connections. As a result most companies have to pick and choose their

markets.



Among industry operators there is, however, a greater recognition of the

need to create a fine balance between regional awareness and a pan-

european overview. This has been reflected in staffing practices.



Training continues to be a major preoccupation - Fleishman-Hillard, for

example, runs regular induction sessions at its Paris headquarters for

new recruits throughout Europe in an effort to create a cohesive team

identity. As countries seek to improve cross-border business, there is

increasing fluidity between local offices, with staff swaps enabling a

broader range of employees to become familiar with different regional

situations. A considerable investment continues to be made in new

technology in terms of video conferencing, Internet and Intranet

capability. And increasingly agencies are finding themselves pitching

together with representatives of regional agencies from their own remote

stations.



Agencies working in Europe are also reporting a growing demand for

integration of client and agency through senior strategic secondments.

At the same time, there are increasing moves towards outsourcing.

‘Companies are looking at cost and instead of building a huge

communications department they keep some body very senior in the

organisation and then outsource services to agencies.’ says Francois

Giannesini of Fleishman-Hillard, who maintains that Europe lags behind

the UK in terms of consultancy. ‘It is part of the Anglo Saxon culture

to buy consultancy services. French managers would tend to think that

they could do it along side everything else,’ he says.



International clients are however getting to grips with the complexities

of the European situation. ‘In the past US companies have looked to

agencies just to implement programmes [in Europe] but have now woken up

to the fact that there is a need for management over the long term, and

that with such a diverse audience there is a need to control the

message,’ says Globalink director Crispin Manners. ‘Increasingly we are

being seen by the American parent as part of the PR process so we work

with US companies to develop a strategy, getting the right spin for over

here right from the start.’



European companies with US agency partnerships have also reported an

increase the export of European business to the US - five to 20 per

cent of work carried out by Fleishman-Hillard in the US is now generated

from Europe - mainly in the form of trade associations or companies

looking to be listed on the New York Stock Exchange.



Germany and the UK are still viewed by international clients as the main

gateways to Europe. Despite a troubled economic year, GPRA, the German

trade association, was able to report a healthy seven per cent industry

growth, a trend set to continue in 1996 according to Hannie Stitz GPRA’s

representative at the International Committee of Public Relations

Consultants. Last year, GPRA members reported that 20 per cent of their

fees were generated from international work, with particular growth in

US and EU work, with many domestic clients deferring decisions regarding

high ticket spend until the economic horizon brightens.



Five years of accelerated growth have created considerable interest in

the French market among owned groups on the European acquisition trail

and networks looking to build their European presence. According to

Syntec Conseil’s President Jacques Marceau the increase in international

work has in turn driven an increased professionalism in the industry,

with a significant growth in spend on technology and a more structured

approach to staff training.



The Netherlands now boasts one of the fastest growing public relations

industries in Europe, being relatively unhampered by economic or

political instability.



By contrast, Switzerland suffered a slight drop in overall PR income as

a result of a continuing economic trough. The market continues to be

dominated by large scale domestic players, with little real inroad made

by international groups.



In Belgium, most consultancies had a flat first half of 1996 with the

Belgian economy going through difficult times with unemployment running

at 14 per cent. However, by necessity Brussels remains a focus of

international strategic communications and public affairs activity.



The Italian market has now stabilised after several mercurial years and

developed as the most sophisticated hi-tech markets in Europe. According

to trade body ASSOREL its members experienced an overall growth of seven

per cent in 1995, its 23 consultancies bringing in a total fee income of

34 million ecu.



The Spanish PR industry also showed a healthy growth and, with a new

party in power, is now set to benefit from a similar wave of

privatisations that have already netted significant gains for

international and domestic agencies in Italy.



Central and Eastern Europe continues to be an area of development but is

still dominated by owned groups as many networks wait for the maturation

of home-grown talent before coming into select potential partners.



The UK’s traditional position as a central buying point for pan-European

campaigns has diminished with Euro-wide accounts increasingly being led

from the continent. ‘People want to buy in a different way now,’ says

Potter. Some clients still cling to a central buying point, while others

prefer to manage their own network following an initial introduction.

And as clients learn to take a more sophisticated approach to European

PR, agencies are being called on to justify every penny or peseta spent

in terms of real benefits.



‘There have been significant changes in the market in the last year.

When you get a request from a client, the connection between the

communication solution and the business is very tight,’ says Giannesini.

‘Clients want PR activity to be directly allied to their business

objectives.’



Rankings: European trade bodies



With the exception of ASSOREL in Italy and Syntec Conseil in France, a

majority of the European PR industry associations produce their own

industry league tables. The Netherlands organisation VPRA produces a

ranking of member agencies on the basis of calendar year net fee income

minus mark-up, with only an occasional overlap with advertising spend.



The Swiss trade association BPRA adheres rigidly to the PR fee-only

rule, and has broadened its net to include non-members in a calendar

year ranking put together by an independent auditing company. The

Spanish trade association ADECEC produces a members-only ranking based

on PR-only fee income as does the Belgian trade body BPRCA - ADECEC’s

ranking being based on fee income only to year end 30 April, two months

in advance of the audited year end of 30 June, while the BPRCA’s table

is based on calendar year income. The German association GPRA does not

organise a formal ranking of agencies, but does publish a break down of

the economic development of member companies.



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