ANALYSIS: The Agency Business: Integrated firms don't necessarily require a lesser role for PR

Most PR pros think that in an integrated agency, PR loses its role as the dominant part of the business. Paul Cordasco finds that in some integrated firms, however, PR can maintain its primary standing

Most PR pros think that in an integrated agency, PR loses its role as the dominant part of the business. Paul Cordasco finds that in some integrated firms, however, PR can maintain its primary standing

Rick French was tired of sending revenue out the door. His Raleigh, NC-based PR and public affairs agency had been growing its list of consumer brands since its inception in 1997, yet he was frustrated that he couldn't offer his clients the additional suite of marketing services they often needed. When it came to collateral marketing materials, direct mail, and other types of non-PR outreach, he was forced to outsource such work to freelancers and other specialty agencies. "When we opened the firm, I had no intention of building an integrated marketing firm," explains French, CEO of French West Vaughan (FWV), originally called Richard French & Associates, which opened its doors in 1997. "It is honestly something our clients were looking for. I saw that there were enough creative opportunities - not necessarily in traditional advertising, but in promotionally related disciplines - that we felt like it was potential business that was going elsewhere." So in 2001, French decided it was time to make a serious move. He acquired respected local ad firm West & Vaughan and merged that offering with his firm. He was suddenly leading an integrated marketing firm. "When we acquired West & Vaughan in 2001, we did it because we do so much work in the consumer area, where we had some well-known brands that were offering us opportunities to go beyond traditional PR," explains French, whose client list includes such blue-chip brands as Wrangler, Honda, and Jack Daniels. "We realized that the ad business is uniquely different from the PR business, and rather than try to build it from the ground up, we thought acquisition was a good route to take." FWV is now a somewhat unique firm. It's an integrated marketing agency whose dominant business remains PR. That image is very different from the one most PR pros envision when they hear the words "integrated marketing." Indeed, PR's role in the marketing mix is often one of so-called "support." Yet at FWV, the leadership is committed to keeping PR in front. "PR is still the dominant part of our business, and I don't want that to change," says French. "But that doesn't mean we would turn down a $25 million ad account. What it does mean is that if we won such an account, we would have to work that much harder to keep PR dominant." The firm's evolution demonstrates that turning a PR agency into an integrated marketing agency doesn't necessarily mean having to turn your back on PR. This is true at FWV, even as its non-PR offerings continue to grow. The firm now offers a suite of services to clients that includes everything from product design to media planning to consumer research. The offering provides great cross-selling potential because it's all coordinated under one roof by one team. For instance, Wrangler is about to unveil a new home-furnishings line. It tapped FWV to handle both the media planning and the creative side of the advertising effort. The company has been a PR client with FWV since the firm's inception. "That's an example of us taking a long-term PR relationship and leveraging it," says French. He says that the cross-selling aspect of the integrated approach was something he thought the firm could exploit early on. "West & Vaughan already had a well-established base of national clients that would offer us some cross-selling opportunities," he explains. Nevertheless, in the years before he opened the firm, French had gained experience working with the advertising side at the agency and client level. And he freely admits that he has had to rely on that experience when building out the ad component of his shop. Others who have made similar acquisitions say that their mergers were born out of a longstanding partnership. "We were comfortable making the merger because we had partnered on several clients beforehand," says Karen Albritton, managing partner at Raleigh-based Capstrat, which has bought a design firm and a marketing communications practice in recent years. French says that the primary reason for the success of his firm's integrated offering is that it grew naturally out of its existing client work. "The client's needs are really what drove our acquisition strategy," says French. "If we did not have so many consumer product clients, I don't know if I would have looked to advertising as the right complimentary discipline for us." Keys to building an integrated agency
  • Client needs can dictate the necessity of offering services outside of PR
  • Partnering with other types of firms can be a strong step toward an acquisition
  • PR need not take a backseat in the marketing mix
  • Cross-selling potential opens another channel for new business

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