Ogilvy PR Worldwide: Agency Business Report 2008

Overall, Ogilvy had a "smashing year," says global CEO Marcia Silverman, with things going really well in the US as well as Asia, and the firm posting a "good" year in Europe.

Outlook
Overall, Ogilvy had a "smashing year," says global CEO Marcia Silverman, with things going really well in the US as well as Asia, and the firm posting a "good" year in Europe.

"We had new business, good growth in existing clients, and hired a lot of good staff," she says. "There was lots of growth from emerging markets, but still great growth in North America. Our Digital Influence practice is growing greatly, and all of our practices are firing on all cylinders."

The public affairs practice in DC is accelerating at the moment, particularly in healthcare. Though there is talk generally of a recession, Silverman says she has yet to see any signs of that within public affairs or other practices.

"There have been times when public affairs have gone well for other agencies but not for us, but right now we're doing very well," she notes. "We keep saying we need to plan for a recession, but I don't think any of the PR companies have seen it coming yet."

Turnover this year was better than last, in part due to a stronger training program within the firm that, among other things, included staff initiatives such as: "Generation O," in which junior staff can share best practices; "Take Five," a social activity for staff members; and the firm's first "Bring Your Parents to Work Day" in New York.

For clients, Ogilvy sought to strengthen specialty services such as health policy, research, crisis management, IR, and multicultural communications. Internally, the firm aimed to build its global communications ability through in-person summits with team leaders around the world.

Within the PR industry, Ogilvy executives involved with organizations included Silverman's chair of the Council of Public Relations and the election of 360 Degree Digital Influence MD John Bell and SVP Virginia Miracle to the WOMMA board of directors.

For 2008, Ogilvy plans to continue strengthening its worldwide practice. "If it ain't broke, don't fix it," Silverman explains. "We want to continue to emphasize the global nature of the agency."

Staff

The firm declined to give an exact headcount, but said its staff numbers were "more than 1,600 people worldwide," an increase of 6% to 10%, compared with 2006. Turnover was slightly more than 20% in 2007, versus 35% in 2006.

Senior hires included EVP and group head of consumer marketing Patrick Simpson, formerly with Edelman; EVP of healthcare Kathy Lauri, previously with Porter Novelli; SVP and head of digital strategy Virginia Miracle, formerly with Brains on Fire and Dell; SVP of technology Siobhan Aalders, formerly with APCO Worldwide; and SVP of social marketing Natalie Adler, formerly of Porter Novelli.

Departures included Chicago MD Betsy Neville, New York MD Kym White, MD of organizational and strategy development Shellie Winkler, and EVP Christopher Loder. Senior-level promotions included Kate Cronin, from global healthcare MD to MD of the New York office; Mike Hatcliffe, who is now MD of Ogilvy's Chicago office in addition to heading its corporate practice; and Beth Ruoff and Lisa Hayden, both former MDs promoted to EVP.

Structural changes
Ogilvy PR made no acquisitions or mergers with other agencies in 2007, though the firm did group its UK-based healthcare staff with a new team called Ogilvy Health PR.

Regional performance
In 2007, the firm opened new offices in Sao Paulo in February; Mexico City in March; and Santiago, Chile, in July.

Practice areas

Practice areas cover public affairs, corporate, healthcare, social marketing, consumer marketing and entertainment, and technology. The firm "globalized" its 360 Degree Digital Influence offering in 2007 through a training program with offices worldwide and regards it as a significant differentiator between Ogilvy and competitors.

Overall, the firm aims to offer integrated communications to clients that cut across its practice areas. Showing the best growth for the firm in 2007, however, was client work tied to the digital communications, healthcare, public affairs, corporate, and consumer marketing practices. Global accounts generated good growth for the tech practice, while social marketing had the least growth.

Accounts

New clients or new projects with existing clients included California Closets, CDW, Centers for Disease Control and Prevention, the Department of Health and Human Services' pandemic flu preparedness campaign, and Unilever. Account wins covering three or more countries included Prudential, BMC Software, LexisNexis, Wrigley, Bristol-Myers Squibb, and Deutsche Bank. Expanded work for existing clients included Johnson & Johnson, Unilever, Nestle, Ford, Motorola, and DuPont. Ogilvy said about 25% of its clients are on retainer - about the same as 2006.

Financial performance
The firm did not provide exact results for 2007, but it said its global revenue was between $200 million and $300 million, and its US revenue totaled between $100 million and $200 million, both up about 15%. Global profit margin was between 20% and 25%, while US profit margin was between 25% and 30%. "Strong top-line growth led to increased bottom-line contribution," the firm said.

Key facts

Principals: Marcia Silverman, global CEO; Paul Hicks, regional CEO, the Americas

Ownership:
WPP Group

Subsidiary Agencies:
Ogilvy Government Relations, Feinstein Kean Healthcare, BWR

Offices:
Nine in the US; 67 worldwide

Revenue:
Global, between $200 million and $300 million; US, between $100 million and $200 million

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