Top 50 Digital Consultancies

With digital playing an increasingly important role in PR, John Owens looks at the agencies leading the way in the fast-changing landscape of online comms.

Top digital agencies: leading the way in the fast-changing landscape of online comms
Top digital agencies: leading the way in the fast-changing landscape of online comms
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Digital is still the hot topic on every agency head's lips. Looking at the Top 50 Digital Consultancies table, it is easy to see why. Nearly every agency in the table has experienced a level of growth in its digital fee income above the Top 150 overall average of nine per cent.

Grayling takes the top spot with £7.4m and nine per cent growth, but it is Edelman in second place that really catches the eye.

Its move up the table represents a 140 per cent increase from 2010, to a figure of £6.4m - 18 per cent of its total fee income.

Also showing impressive growth in the upper echelons of the table was the sole digital-only agency We Are Social, which moved up two places to fourth.

Most improved in digital, meanwhile, was The Whiteoaks Consultancy, which saw digital income rise to £1m and moved up the table from 41st to 18th. This represented an impressive 219 per cent growth on 2010, 25 per cent of its total income.

Other honourable mentions should go to Octopus Group and Munro & Forster, both of which saw digital income more than double.

Overall growth, meanwhile, is illustrated by the fact that 18 agencies made more than £1m from digital work, compared with 13 agencies last year. The amount of digital revenue needed to make it on to the list has also gone up. Seven Hills, in 50th position, made £341,000, compared with DTW's £196,000 last year.

The story was not quite so good for Communications Management, which dropped out of the top ten after being the only agency to see a percentage decline in its digital work. The drop of 13 per cent meant it moved down to 14th position.

This is the second year PRWeek has published the table. And, as with last year, we publish this table with caveats. Although it provides an informative snapshot of the industry, it should not be treated as a definitive guide.

While it is an increasingly essential tool in an agency's offering, online is a channel rather than a specialism, and this leaves many agencies unable to separate their digital fee income from their overall total.

So while some firms may not appear in our table, that does not mean they have a low fee income from digital activity.

Overleaf we take a more in-depth look at how digital work has changed over the past 12 months.

Click here to see the full table

Also read: Robin Grant: A man on a digital mission

THE LANDSCAPE The agency marketplace

Throughout 2011, agencies continued to ensure that all members of staff had digital skills, rather than just a select few.

Grayling's MD of digital, Victor Benady, says he saw this happening as 'anxiety' around digital work fell away and agencies embraced the medium.

'There's been a tendency to undervalue digital and that's changing. Account executives are now more informed about digital channels and clients are seeing the value in digital work,' he says.

This growing realisation, and the financial constraints of the current economic situation, has meant agencies generally favour integrated digital offerings over separate departments.

MHP's head of digital Mark Pack says: '2011 was a relatively tough year for the PR industry, so that has held back developments like the launch of digital branches and spin-offs.' But he argues that the financial constraints have been a blessing in disguise - as technology matures, there is less of a need for separate divisions.

These integrated agency structures are also reflected in the way agencies charge fees - they are increasingly being incorporated into the overall fee structure. 'Digital is being seen more as a core part of our offering. Just like you wouldn't think of charging clients for work done using telephones, digital is a core part of how good outfits approach their work,' says Pack.

And during a year in which the impact of tablets and smartphones really kicked in, increasing the need for adaptable digital products, some believe PR is winning the digital turf war.

'Last year was a step forward for PR,' says Consolidated PR's head of digital Paul Borge. 'There's been a goldrush over the past three years and it's nice to see the industry emerging from that in a strong position.'


DEMAND What do clients want?

In the past, there was a perception that clients wanted to develop a digital offering because it was fashionable, and they were worried they would be left behind. But last year, this 'me too' attitude gave way, to be replaced by a desire for something less superficial. Clients are becoming more educated about the digital world and its potential, and are now often coming to agencies with digital proposals rather than having to be persuaded by agencies.

There is an emphasis on deepening digital offers, whether through further developing established websites or offering crisis management through channels such as social media.

Benady says he is seeing more digital-only briefs: 'Companies are looking for big inside-out global strategies which tend to be separate from PR programmes. We're also finding existing clients coming to us for an extra digital element.'

The focus of these briefs is still on mainstream sites like Facebook, Twitter and YouTube. Pack says more clients are aware they need to engage with journalists on Twitter, even if the brief is offline.

Bite Communications' head of digital Dan Sands says as Facebook has grown and matured as a platform, it has become relevant to more audiences than before. 'There are a lot more communities we can reach on Facebook than in the past so it's not just about consumer work,' he says.

Internal comms, for example, is seeing a step change. 'Employers are investing time and resources to work more collaboratively. Digital is the catalyst to break down divisions within their own comms offering,' says Borge.


SECTORS Which areas are most fertile?

While consumer work still frequently sets the pace,the most notable move forward over the past year was in corporate.

'We've seen a big growth in the corporates' need for digital work,' says Benady. He believes corporate clients are beginning to understand that the digital world can have a huge impact on their reputation both internally and externally: 'Rather than being seen as something to be dealt with by marketing teams and management consultants, social media have filtered down, with employees now frequently using them. This means the flow of information is much freer than it was before, pushing social media into the realm of larger reputation management issues and thus PR agencies.'

In particular, regulation-restrained financial groups are starting to take note of digital, whether through monitoring their reputation online or managing crisis comms. Pack believes US banks are engaging well with social media, and are setting a great example for the more tentative UK banks to follow.

For example, US-based investment firm Pimco has an active Facebook page that is regularly updated, generates comments and has more than 5,600 'likes'.

Edelman's digital MD, EMEA, Marshall Manson agrees digital work has become more evenly spread across different sectors: 'Consumer brands have led the way in social media, but there's been a lot of catching up and consumer isn't a dominant part of our digital revenue any more.'

But there are differences in the content of the various sectors' briefs. Manson says he saw more digital briefs in the health sector, but that they were often more traditional in their approach - perhaps a symptom of the restrictions on marketing drugs.

'Healthcare is not as social media-driven as elsewhere. It's more driven by traditional digital techniques such as developing websites and use of email,' he says.

Benady believes consumer briefs are becoming more competitive, with clients bringing in agencies from different disciplines to pitch against each other - a practice yet to take off in the corporate sector.


THE FUTURE Where next?

The explosion of tablets and increasing ubiquity of smartphones will continue to shape online work. And with smart TVs also on the rise, video content is tipped as an area of huge potential.

This spread of increasingly sophisticated technology means PR professionals need to create content that will work across platforms, whether on a phone or a laptop.

'PR professionals will need to increase their understanding of the point at which the consumer will be engaging with a brand. People will generally not be sat in front of a PC screen engaging with your brand - it will be in the palm of their hands while they are out and about somewhere,' says Borge.

Access to content is one challenge. The second is the changing platforms themselves. The major social media sites are unlikely to be toppled soon, but they are continually developing.

'Social media-led CRM (customer relationship management) is a really interesting area. As online communities grow and grow we're going to have to go back and look at how we engage in one-to-one comms. Increasingly platforms like Twitter and Facebook allow more CRM as they become more flexible in their use,' says Manson.

Looking beyond social media, Benady says the past few months have seen an explosion of growth in multi-market clients showing interest. He points out this is work that only a smaller pool of agencies are able to service.

Pack believes politics will have a significant impact for the rest of 2012 and beyond. This includes government efforts to extend powers for online monitoring and the proposed Communications Bill.

'There are measures to encourage high speed broadband. It will be interesting to see how this plays out in raising internet connectivity in certain areas and the impact it will have on clients with a strong presence there,' he says.

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