MSLGroup: Agency Business Report 2008

MS&L had its best year ever with a strong margin performance of 19% that placed it second among all parts of Publicis Groupe, says global CEO Mark Hass.

Outlook
MS&L had its best year ever with a strong margin performance of 19% that placed it second among all parts of Publicis Groupe, says global CEO Mark Hass. Growth was top-line and bottom-line; due to global revenue (30%) and organic growth (15%). With 50% growth, Asia was a shining star among its international regions.

"We used to be an American firm that had offices globally," says Hass. "We're now an international firm that comes from an American spirit, history, and position."

The international digital team, which began investing in CSR three years ago, is investing in several new areas to keep ahead of client interest. "We have a serious commitment to the creation of new knowledge that can then be analyzed and lead to new business [for our clients]," says Hass.

Despite economic forecasts, Hass is optimistic about 2008. "We went in with an ambitious business plan despite economic softness," he says. "We don't think it [will] be as bad as people are feeling."

Staff

Global headcount in 2007 rose 61% to 1,250. Staff turnover was 2.9%. In North America, hires included David Chamberlin, SVP; Karen Margolis, VP; and Megan Jordan, SVP and co-director of its global ECO Network. London additions included Judith Cranford, head of healthcare, and Vicki Newbold, head of corporate. In Asia, Eric Hess was named MD, Tokyo.

Senior departures were Larry Kamer, president, North America; Erica Backhaus, CEO in Frankfurt; and Mike Konzcal, deputy MD in DC.

Structural changes
Two major acquisitions: Hanmer & Partners (now Hanmer MS&L), a communications consulting firm based in India; and The McGinn Group, a corporate communications firm in the US, renamed TMG Strategies. MS&L added 16 offices in all.

Regional performance
Several of the firm's largest offices internationally delivered more than 20% margins. MS&L's Asia network saw 50% growth.

Practice areas

Five main areas: consumer, healthcare, corporate, technology, and financial communications. Consumer represents about 35% of global business, while corporate and healthcare total about 30% each.

Accounts
New business included Heidrick & Struggles (AOR), Clinique, Bayer, Abu Dhabi National Energy Company (TAQA), and Johnson & Johnson. The firm expanded its business with Coca-Cola and GM. In North America, about 10% of the firm's clients are on retainer; internationally, between 30% and 40% are on retainer.

Financial performance
Global revenue was between $200 million and $300 million, while US revenues were in the $100 million to $200 million range. Global change in revenue was 19%.

Key Facts

Principal: Mark Hass, global CEO

Ownership:
Publicis Groupe, as part of SAMS (Specialized Agencies and Marketing Services)

Offices:
42 wholly owned offices globally, including 11 in the US, 18 in EMEA, and 13 in Asia-Pacific

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