EDITORIAL: Dawn of a new era or a red herring?

Fleishman-Hillard, last year, nudged ahead of Burson-Marsteller to

become the largest agency in the US. Today, it is officially crowned the

largest agency in the world, sweeping past Burson, Hill & Knowlton and

Weber Shandwick Worldwide in the process.



It's been an extraordinary rise for Fleishman. In 1980 (20 years ago),

the St. Louis-based firm was billing dollars 2.75 million. Today it's

doing dollars 267 million in the US - nearly 100 times that amount. But

the biggest change this year has been its global surge, with worldwide

revenues swelling to dollars 343 million, up 61%.



(By comparison, Hill & Knowlton, then the largest firm with revenues of

dollars 34 million, has grown just under 10 times to dollars 306

million.)



The race has not been won without a fight. The merger of Interpublic

companies Shandwick and Weber was cunningly devised to leapfrog WSW to

the No. 1 spot, giving CEO Larry Weber the 'bully pulpit' from which to

boss the PR industry agenda. But Fleishman has resorted to its own

cunning ruses, merging GPC, an Omnicom-owned public affairs agency -

with strength in Canada, Brussels and London - into the Fleishman

fold.



These moves have left the old-school firms of Hill & Knowlton and

Burson-Marsteller floundering in their wake. For Burson in particular,

the new world order has been felt most keenly. Last year, it lost the

top spot in the US, but it was still the largest agency in the world

This year, it drops to No. 4.



But the race for the No. 1 spot is a red herring. With four companies

posting global revenues in excess of dollars 300 million, the old

one-two is over. The PR agency business has entered a new era of

competitiveness, and we expect to see constant leapfrogging over the

next few years.



Nor is this a moment to congratulate ourselves on the 'coming of age of

PR.' That's just another red herring. 'It used to be,' wrote Advertising

Age, 'that whenever the economy sneezed, the public relations industry

would come down with pneumonia. Considered a non-essential function by

top management, PR was among the first to be cut when business slowed

down, and even the suggestion of a downturn was more than enough to send

shivers through the PR industry. Today, however, PR seems much more

robust.'



That article was written in 1980 - when Fleishman was a little PR shop

in St. Louis. But the fact is, Fleishman is still little by comparison

with management consultants, accountancy firms, law firms and others in

the management advisory chain. For example, Fleishman is the same size

as the 48th largest management consultancy.



The good news is that there is still plenty of upside. While the

stuttering economy will certainly have an impact on the extraordinary

growth enjoyed by agencies in the past three years, it cannot dim the

obvious potential that PR has to nestle and jostle itself into the

management consciousness.



But the focus must not be on the race for No. 1. And the industry must

shed its obsession with respect. All growth and all acquisitions must be

focused on improving the client offering. If we get that right -

professionalizing, formalizing, validating - the other objectives will

follow, naturally



Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Would you like to post a comment?

Please Sign in or register.