All indications are that WS remains the largest and broadest PR firm in the world.
Harris Diamond, WS CEO, says bluntly that 2006 saw "the best growth in the history of the firm," driven by organic growth. And Andy Polansky, president, reports that the firm experienced double-digit growth in all of its major geographies.
"That's never happened before," says Diamond. "Usually one geography [lags]. We've never had them all grow."
Polansky says organic growth has been driving the overall growth of the agency. It's a good thing, too; while the woes of its parent company have continued (albeit less dramatically than last year) on the advertising side, IPG's PR agencies have been a consistent bright spot for the company's financial performance. That gives the holding company even more incentive to treat WS well. Considering the current revolution in marketing communications overall, a crown jewel PR firm like WS would likely be more attractive in the open market than some of IPG's more downward-trending ad agencies.
Diamond says the corporate, consumer, and technology practices were the three strongest performers last year. The firm is seeing growth so far this year being mainly driven by healthcare, technology, and financial services. All of those are core practices of every major agency and competitive in their own right. The fact that WS, perhaps the furthest thing there is from a "specialty" agency, can compete strongly in specialist-ridden fields like tech and finance is an indication of the firm's ability to distinguish its own specific capabilities while maintaining a unified offering powerful enough to attract the world's biggest clients.
Polansky also says WS is winning more government contracts, making DC a potential steady growth hub. The firm added significant strength to Powell Tate, its public affairs shop, with the hiring of Wallace, the high-profile former White House communications director.
WS has also been nimble in responding to current areas of demand, ratcheting up its corporate responsibility work in an atmosphere of constant scandals, and launching corporate reputation research work dubbed "Safeguarding Reputation." The addition of Gaines-Ross from Burson-Mar- steller will go a long way toward boosting WS' thought-leadership work in the area of corporate reputation, as well.
Moving forward, WS appears well positioned to not only keep current clients happy, but also to be quick to expand and fill the gaps in global demand for PR services. Although Eastern Europe is not yet a high-volume area, it is widely cited as an intriguing prospect for growth, and WS covered the entire region last year through both new office openings and new affiliate relationships. Time will tell whether the top is truly a comfortable place to be in the rapidly evolving PR world.
KEY FACTS
Principals: Harris Diamond, CEO; Andy Polansky, president; Jack Leslie, chairman
Ownership: Interpublic Group
Offices: 83 owned offices globally in 40 markets, including 22 in the US
Staff
Key hires included Leslie Gaines-Ross, chief reputation strategist; Bonin Bough, EVP of emerging media and interactive marketing; Deb Bohren and Nicolle Wallace, EVPs of Powell Tate/WS; Thomas Graham, EVP and GM, Austin, TX; Kerry Harris, EVP and GM, Toronto; Rachel Pay, European healthcare practice MD; and several SVPs. Barb Iverson was promoted to president of the North American financial services practice. Departures included Fiona Hall, European healthcare practice MD; Sally Ward, vice chairman, Europe; and David Yelland, vice chairman, London.
Structural changes
WS opened new offices last year in Miami, the Philippines, Sweden, Poland, Croatia, and Bosnia and Herzegovina. It also signed new affiliate offices in Iceland, Romania, Slovakia, Serbia and Montenegro, Latvia, Lithuania, and Estonia.
Regional performance
In the US, WS cites the Baltimore; Cambridge, MA; Chicago; Dallas; LA; Minneapolis; New York; San Francisco; Seattle; and DC offices as having particularly strong years. Internationally, the firm reported strong growth in the UK and throughout continental Europe, rapid expansion in China and the rest of Asia, and business turnarounds in Germany, Brussels, and Switzerland.
Practice areas
WS has 26 practice areas, covering the broad range of communications services for various audiences. In 2006, it relaunched its interactive media group, Screengrab, and launched a Cleantech unit under its technology practice. The corporate responsibility group was cited for strong performance. The strongest growth last year came in the healthcare, financial services, consumer, technology, multicultural marketing, and Web relations practices, and the firm reported "healthy growth in all practice areas."
Accounts
Key wins included A1 Grand Prix, American Council on Education, BBC World, Centers for Medicare and Medicaid Services, Cerberus Capital Management, Champion, Chicago Federal Reserve, Credit Suisse, Goodyear, Ikea, Lipitor, Save Darfur, Tyco Healthcare, US Mint, UPS, and Vonage. The agency reported 10 account wins across three or more countries. Key account losses included Freescale Semiconductor, Lexmark, and BEA. Existing clients that expanded their accounts included American Airlines, Department of the Treasury, Genentech, GM, MasterCard, Microsoft, Pfizer, Unilever, and Verizon Wireless.
Financial performance
The agency did not release specific financial information. It did say, "Our financial performance exceeded expectations both in terms of revenues and profit," and cites "strong double-digit growth in our multinational client portfolio." WS says it experienced a 28% organic growth rate across its top 40 clients. Speaking of IPG's full-year results for 2006 in a conference call, CEO Michael Roth said, "Within CMG, every one of our units made contributions, with particular strength in PR." CFO Frank Mergenthaler cited WS, and sister firm GolinHarris, specifically.
Agency's full questionnaire follows below:
Name of parent division/company (enter both where applicable):
The Interpublic Group of Companies
Name of subsidiary companies:
N/A
Has your ownership status changed in the past year?
No
Name of global CEO and US CEO (or most senior equivalent):
Harris Diamond, CEO
Andy Polansky, president
Name of person, if any, the most senior person named above reports to:
Michael Roth, chairman and CEO, Interpublic
What is your current headcount?
We do not release this information in compliance with our parent company's policy.
How has your headcount changed since FY 2005?
We do not release this information in compliance with our parent company's policy.
What was the percentage of staff turnover in 2006?
We do not release this information in compliance with our parent company's policy.
Did you make any senior hires in 2006 (VP and higher)? Please state name, title (and unique responsibilities, if applicable), and previous company:
Weber Shandwick made many strategic senior hires in 2006/2007 including:
North America
- Dr. Leslie Gaines-Ross, chief reputation strategist, New York (Burson-Marsteller)
- Bonin Bough, EVP, Emerging Media/Interactive Marketing, New York (Ruder Finn)
- Deb Bohren, EVP, Powell Tate | Weber Shandwick, Washington, D.C. (WellChoice)
- Nicholle Wallace, Executive Vice President, Powell Tate | Weber Shandwick (White House Communications Director)
- Thomas Graham, EVP/GM, Austin (Edelman)
- Kerry Harris, EVP/GM Toronto (Level 5)
- Jennifer Blake, SVP, Los Angeles (Manning, Selvage & Lee)
- Emil Hill, Senior Vice President, Powell Tate | Weber Shandwick, Washington, D.C. (Manning, Selvage & Lee)
- Kevin Hooks, SVP, The Axis Agency, Los Angeles (UPP Entertainment Marketing)
- William Kenny, Senior Vice President/Management Supervisor, New York (Robinson Lerer & Montgomery)
- Jeanne McIntyre, SVP, Chicago (Fleishman Hillard)
- Greg Peverill-Conti, VP, Cambridge (Davies Murphy Group)
- Dan Pooley, SVP, Chicago (CKPR)
- Wally Sabria, SVP, Los Angeles (Raw Media)
- Richard "Denny" Shields, VP, Minneapolis (Minnesota Air & Army National Guard)
- Leslie Wheeler, SVP/Celgene client relationship leader, New York (Ruder Finn)
- High Williams, VP, Chicago (CKPR)
Europe
- Rachael Pay, managing director, European Healthcare practice (Euro RSCG Life PR)
- James Warren, director, Web Relations, London (Bite Communications)
- Wolfgang Lang, managing director, Cologne (BBDO/Bob Bomliz Group)
- Annamaria Ferrari, managing director, Milan (Publicis Consultants | Rowland)
Asia Pacific
- Darren Burns, managing director, Shanghai and Guangzhou (GolinHarris)
- Wei Hsiang, general manager, Taiwan (Ketchum)
- Charles Shen, VP, corporate and technology practices, Beijing (Intel)
- Ken Hong, managing director, Thailand (Manning, Selvage & Lee)
What senior staff have departed the firm? Please state name and previous title.
- Fiona Hall, managing director, European Healthcare practice
- Sally Ward, vice chairmwoman, Europe
- David Yelland, vice chairman, London
Please list any other senior management changes, including restructures and significant, senior-level promotions.
Senior appointments and promotions included:
- Barb Iverson appointed president of Weber Shandwick's North American Financial Services practice.
- Marc Abel promoted to EVP in our St. Louis office.
- William Brent was promoted to SVP and appointed head of Cleantech unit.
- Bryan Specht promoted to EVP in our Chicago office.
- Tim Fry promoted to EVP and continues in his role as Microsoft Client Relationship Leader.
- Chris Perry promoted to EVP, general manager of Detroit office.
- Miguel López-Quesada Gil expanded his role in the newly created position of chairman Iberia/Latin America while continuing to serve as CEO of operations in Spain.
- David Liu promoted to managing director, China.
Have you made any acquisitions in the past year, or merged with another agency?
No.
How many partly owned offices or affiliates do you operate globally?
With a core of 83 owned offices in 41 markets and affiliates that expand the network to more than 121 offices in 73 markets, Weber Shandwick operates in virtually every major media, government and business center on six continents.
Headquartered in New York, Weber Shandwick's global network is comprised of the following regions and offices (both wholly-owned and Weber Shandwick affiliates):
United States
Atlanta, Austin, Baltimore, Boston/Cambridge, Chicago, Dallas, Denver, Detroit, Houston, Irvine, Kansas City, Los Angeles, Miami, Minneapolis, New York, Orange County, Portland, San Francisco, Seattle, St. Louis, Sunnyvale, Washington D.C.
Canada
Calgary, Ottawa, Toronto, Vancouver
Latin America
Argentina (Buenos Aires*, Rosario*), Brazil (Rio de Janeiro*, Sao Paulo*), Chile (Santiago*), Mexico (Mexico City*), Uruguay (Montevideo*)
Europe, Middle East & Africa
Algeria (Algiers), Austria (Vienna*), Azerbaijan (Baku*), Bahrain (Manama), Belgium (Brussels), Bosnia & Herzegovina (Sarajevo), Bulgaria (Sofia*), Cote d'Ivoire (Abidjan*), Croatia (Zagreb), Cyprus (Nicosia*), Czech Republic (Prague), Denmark (Copenhagen*), Egypt (Cairo), Estonia (Tallinn*), Finland (Helsinki*), France (Paris), Germany (Berlin, Cologne, Frankfurt, Hamburg, Munich), Greece (Athens*), Hungary (Budapest), Iceland (Reykjavik*), Ireland (Dublin), Israel (Tel Aviv), Italy (Milan, Rome, Turin), Jordan (Amman), Kenya (Nairobi*), Kuwait (Safat), Latvia (Riga*), Lebanon (Beirut), Lithuania (Vilnius*), Macedonia (Skopje*), Morocco (Casablanca), Netherlands (The Hague), Nigeria (Lagos*), Norway (Oslo*), Oman (Ruwi), Poland (Warsaw), Portugal (Lisbon), Qatar (Doha), Romania (Bucharest*), Russia (Moscow*), Saudi Arabia (Jeddah, Riyadh), Serbia & Montenegro (Belgrade*), Slovakia (Bratislava*), Slovenia (Ljubljana*), South Africa (Cape Town*, Johannesburg*), Spain (Barcelona, Madrid), Sweden (Stockholm), Switzerland (Geneva, Zurich), Tunisia (Tunis), Turkey (Istanbul*), Uganda (Kampala*), Ukraine (Kiev*), United Arab Emirates (Dubai), United Kingdom (Aberdeen, Belfast, Cardiff*, Edinburgh, Glasgow, London, Manchester)
Asia Pacific
Australia (Sydney), China (Beijing, Guangzhou, Hong Kong, Shanghai), India (Bangalore, Mumbai, New Delhi), Indonesia (Jakarta), Japan (Tokyo), Korea (Seoul*), Malaysia (Kuala Lumpur), Pakistan (Islamabad*, Karachi*, Lahore*), Philippines (Manila), Singapore (Singapore), Taiwan (Taipei), Thailand (Bangkok)
* Affiliate office
What offices opened in 2006 or early 2007?
Our global reach expanded in 2006 as we opened new offices and forged new strategic alliances. We opened six new offices - Miami, the Philippines, Sweden, Poland, Croatia, and Bosnia and Herzegovina. We also opened new affiliate offices in Iceland, Romania, Slovakia, Serbia and Montenegro, Latvia, Lithuania, and Estonia.
What offices closed in 2006 or early 2007?
None
Which regions, US and globally, are growing, and why?
North America continues to be a powerful engine for the growth of U.S.-based multinational clients, drawing on firm resources around the globe. Our offices in Baltimore, Cambridge, Chicago, Dallas, Los Angeles, Minneapolis, New York, San Francisco, Seattle and Washington, D.C., all have had strong years.
Further fueling our progress was year-on-year growth in the UK and in nearly all Continental European markets. In particular, we saw strong performance turnarounds, under new leadership, in Germany, Brussels and Switzerland. We also had rapid business expansion in China and solid growth across all major Asia Pacific markets more broadly.
Practice areas
How many practice areas do you have? Please list.
Weber Shandwick has 26 practice areas and specialty groups:
Biotechnology
Broadcast Media Services
Business to Business
Consumer Marketing
Corporate
Crisis Management
Entertainment Marketing
Financial Communications
Financial Services Marketing
Global Strategic Media Group
Government Relations
Healthcare
Internal Communications
Issues & Advocacy Advertising
Litigation Support
Media and Presentation Training
Multicultural Communications
Public Affairs
Research
Scientific Communications
Sports Marketing
Technology
Travel
Visual Communications
Web Relations
Youth Marketing
Which ones are new?
Contributing to our healthy growth was an emphasis on specialty practice groups. We continued to provide our clients with new services in high-demand areas, including our interactive media group, which we relaunched as screengrab. The group's mission is to use today's enhanced communications resources to most compellingly tell our clients' stories, deliver new ideas, craft the most targeted messages and engage audiences meaningfully - putting our clients at the epicenter of the screens their targets are using.
The Axis Agency (our multicultural marketing partner created in 2005 from a Weber Shandwick practice) and our Cleantech practice (launched in 2006 as part of our Technology practice) are led by the Weber Shandwick colleagues whose passion and business insights drove their creation. In addition, our corporate responsibility group, led by Brendan May in London, is adding value to many client programs in another area that is under intense scrutiny today.
Of those, which ones are part of the core strategy of the agency?
All of our practice groups and specialty areas are integral to the core strategy of Weber Shandwick.
Which practice areas have been phased out in the past year?
None
What practice areas showed the most growth?
Growth has been particularly strong in healthcare, financial services, consumer, technology, multicultural marketing and Web relations practices.
Which practice areas showed the least growth?
We experienced healthy growth in all practice areas.
What is the distribution of accounts across practice areas?
Agency declined to give information.
Accounts
What key account wins did you have in 2006?
New account wins in 2006/2007 include:
- A1 Grand Prix (across three or more countries)
- Alzheimer's Association
- American Council on Education
- BBC World
- Centers for Medicare and Medicaid Services
- Cerberus Capital Management (across three or more countries)
- Champion
- Chicago Federal Reserve
- Commonwealth Connector
- Credit Suisse
- Goodyear (Europe) (across three or more countries)
- HD DVD Promotion Group
- IKEA
- Intercontinental Hotels and Resorts
- Lipitor (across three or more countries)
- Living Steel (across three or more countries)
- MAC Aids Fund
- Micron (across three or more countries)
- Save Darfur (across three or more countries)
- Sochi 2014 (across three or more countries)
- Sustainable Forestry Board
- Tyco Healthcare
- United States Mint
- UPS (Europe) (across three or more countries)
- VeriSign (across three or more countries)
- Vonage
Of your 2006 wins, how many were across three or more countries?
See above
What key accounts did you lose in 2006? If based outside the US, or are global, please state regions. Freescale Semiconductor, Lexmark and BEA.
Did you expand any existing accounts into new domestic or international markets or sectors?
Weber Shandwick experienced impressive organic growth from key multinational clients. We took on new assignments from existing clients such as American Airlines, AWARE (Americans Well-Informed on Automobile Retailing Economics), Colombian Coffee Federation, Department of the Treasury, Federal Reserve Board, Genentech, General Motors, MasterCard, MasterFoods, Microsoft, Monster Worldwide, Pfizer, Raytheon, Susan G. Komen Foundation, Unilever and Verizon Wireless.
What proportion of your clients are on a retainer?
Agency declined to give information.
Has this changed over the past year?
Agency declined to give information.
Performance
What was your 2006 global (including US) revenue?
We do not release this information in compliance with our parent company's policy.
What was the % change over 2005 global revenue:
We do not release this information in compliance with our parent company's policy.
What was your global profit margin in 2006?
We do not release this information in compliance with our parent company's policy.
What was your 2006 US revenue?
We do not release this information in compliance with our parent company's policy.
What was the % change over 2005 US revenue:
We do not release this information in compliance with our parent company's policy.
What was your US profit margin in 2006?
We do not release this information in compliance with our parent company's policy.
Did you experience top-line or bottom-line growth in the past year, or both?
We do not release this information in compliance with our parent company's policy.
How much of your growth was organic, and how much was due to new business won?
We experienced organic growth of 28 percent across our top 40 clients, and won a significant number of high-profile assignments around the globe as well.
How did your performance, in terms of revenue and growth, meet expectations you had for the year? Please answer this even if you have not submitted revenue figures, including any information that characterizes your 2006 performance.
Our financial performance exceeded expectations both in terms of revenues and profit. We continue to see strong double-digit organic growth in our multinational client portfolio, and significant growth in healthcare, financial services marketing, consumer, technology, Web relations and multicultural communications.
Please briefly outline any initiatives undertaken in 2006 that add to your agency's story, such as staff development/training, fundraising/charitable initiatives, community programs, business partnerships, etc.
For more than a decade, Weber Shandwick's communications professionals have been providing reputation management counsel to leaders at Fortune 500 and other companies, government organizations, countries and other municipalities, and educational institutions around the world. To continue to offer our clients the highest level of reputation management services, knowledge and resources, Dr. Leslie Gaines-Ross, the world's leading expert in CEO and corporate reputation, joined our team as chief reputation strategist.
In 2006, we launched Safeguarding Reputation (first wave of our corporate reputation research). The inaugural global launch focused on strategies for safeguarding reputation once crisis strikes. A comprehensive executive summary accompanied the first release of the findings. The second wave was released in November 2006 and focused on the role of corporate responsibility in safeguarding and recovering reputation. These findings were also amplified in an executive summary devoted to corporate responsibility's critical role in reputation management. The third wave of research and analysis was released in February 2007 and focused on triggers of reputation failure.
Last year, we also launched www.webershandwick.com/reputationRx (provides the latest news, research, best practices and commentary on how to build and protect CEO and corporate reputation), CEO Turnover and Trends, and http://www.webershandwick.net/newsroom/www.reputationXchange.blogspot.com (Dr. Gaines-Ross' reputation management blog).
The strategic hire of Dr. Gaines-Ross and the development of Weber Shandwick's reputation team have brought the structure of our reputation management services and thought leadership platform to an exciting new level. Weber Shandwick colleagues around the world are now further able to provide clients with the most relevant, customized strategic counsel, groundbreaking research and the latest insights into corporate reputation.
Intellectual Capital and Propriety Tools
Whether reaching untapped consumers, protecting reputation, or understanding patient empowerment in China or trends in travel and tourism, companies are increasingly looking to their public relations firms for research-based insights that can steer them through their most pressing challenges. The following are among the proprietary surveys Weber Shandwick launched in 2006, whose findings are making meaningful contributions to client communications programs.
The Changing Face of Marketing and Communications in Today's Creativity Economy
Reaching key audiences through customized and personalized means is increasingly critical in today's Creativity Economy, which is based on ideas and innovation rather than knowledge and education. This survey of business executives, performed by Weber Shandwick and its opinion and market research company KRC Research, found that marketing and communications are being widely embraced by senior executives as leading drivers of top-line growth. It also revealed the critical role customized and personalized communications such as social networking and niche marketing are now playing in consumer outreach.
Safeguarding Reputation
Weber Shandwick, in partnership with KRC Research, conducted this extensive global survey of 950 business executives in North America, Europe, Asia and Brazil that examines the full range of reputation issues. The survey covers such topics as drivers of corporate reputation, triggers for reputation damage and reputation recovery post-crisis. Among the survey's findings is that a significant 63 percent of a company's market value is attributable to its reputation. The study also showed that nearly 90 percent of executives surveyed agree that there has been a growing trend of corporate reputation damage, with Asia executives even more likely to report a rise in tarnished reputations. Other reputation research surveys explore issues ranging from CEO departure rates and the potency of CEO apologies to the rise of interim CEOs.
The Screening of America
Weber Shandwick launched a new study in 2007 of consumer screen habits conducted by KRC Research on behalf of screengrabTM. The study found that the average person is likely to be using more than three screens daily for information and entertainment.
Patient Power in Asia
In an environment where patients in Asia were perceived to be less proactive than their Western counterparts on personal health issues, Weber Shandwick performed a study to determine the accuracy of this perception. The study, conducted with TNS, a global provider of market information, found that patients throughout Asia - China, Hong Kong, Korea, Singapore and Taiwan - are becoming more resourceful and knowledgeable about their health before and after visiting the doctor. It found that while doctors still top the list of information providers, patients rated the Internet and news media as reliable sources of medical information. The study also revealed that not only are patients in Asia proactively seeking more information, but they are also using it to confirm their diagnoses and requesting specific prescription medicines. These groundbreaking results indicate that Asians are following a growing trend of patients who no longer rely solely on their doctor's advice when considering the state of their health. They also position Asia as a burgeoning growth market for the pharmaceutical industry. This Weber Shandwick study is the first of its kind in Asia.
Country Brand Index
FutureBrand, a leading global brand consultancy, partnered with Weber Shandwick on the second annual Country Brand Index (CBI) survey to identify the top overall country brands and emerging global travel trends in the world's fastest-growing economic sector - travel and tourism. More than 1,500 international travelers, travel industry experts and hospitality professionals participated in the global survey. The CBI ranked Australia as the top overall country brand, followed by the United States and Italy. China, Croatia and the United Arab Emirates were declared the top three "rising star" countries that are likely to become major tourism destinations in the next five years. These results further show that branding is a tremendous opportunity for both developed and developing countries to build preference, consideration, loyalty and advocacy.
Weber Shandwick | Making A Difference
Our commitment to our clients and employees extends to the communities in which we work and live. Our employees offer their time, knowledge and resources to non-profit organizations; volunteer for local causes; and organize employee teams to participate in charity fundraisers. Weber Shandwick's "Making a Difference" internal awards program recognizes our offices' superior pro-bono community outreach programs around the world. Award-winning 2006 campaigns were the UK's War Child, "Help: A Day in the Life"; Hong Kong Cancer Fund, Opening of CancerLink Support Centre; and "Telling Your Story" Workshop in Minneapolis. Our community efforts were further recognized when the ERM Certification and Verification Services (ERM CVS) awarded our London office the internationally recognized ISO14001 certification following its review of our environmental management and procurement practices.
2007 Agency Business Report
