Porter Novelli: Agency Business Report 2006

PN is deservedly proud to report that 20 staffers returned to the agency in 2005.

PN is deservedly proud to report that 20 staffers returned to the agency in 2005.

Last year's rebranding, instigated by CEO Helen Ostrowski, still resonates. "We are continuing our efforts of living that positioning," says president Gary Stockman.

PN says client budgets and RFPs rose in scope and number in late 2005, while client interest in its corporate and public affairs areas rose, too. The firm expects clients to start tapping into more of its specialty practices in hopes of running more fully integrated communications efforts.

Now, says Ostrowski, the firm is focused on "drilling into exactly how the work gets done at the agency," identifying what are the best approaches and delivering them consistently to all clients. She also says that acquisitions might be in the pipeline.

Ostrowski's role as 2006 Council of PR Firms chairman will likely have the halo effect of putting her own agency a little further under the spotlight.

Name of parent division/company

Name of subsidiary companies

Name of global CEO and US CEO (or most senior equivalent)
Helen Ostrowski, CEO
Gary Stockman, President

What is your current headcount, and how has it changed from this time last year? What was the percentage of staff turnover?
Due to Omnicom policy, we are unable to provide this information.

Did you make any senior hires in 2005 (VP and higher)? Returning staff – Porter Novelli's boomerang trend continues. In 2005, 20 employees returned to the agency, most citing our culture as the reason for their return. These boomerangers cross all discipline/industry areas and all levels, from AAE to SVP. Our SVP boomerangers in 2005 were:
Elisia Canna, SVP, health care (New York) who rejoined the agency after a 1.5-year absence. Elisia was previously with Ogilvy.
Simon Dibb, SVP, corporate (New York) who rejoined the agency full time after a six-year absence. Simon worked for a small boutique agency and as a freelance consultant before re-joining Porter Novelli.
Kevin Slagle, SVP, head of land use sector (Sacramento) who rejoined the agency after a one-year absence. Kevin's previous position was with Teichart.

Other senior hires include more than a dozen VPs and the following SVPs and above:
Isabelle Claxton
, EVP, health care (New York). Previous position was with Cohn and Wolfe.
Peter Eschbach, SVP, corporate (New York). Previous position was with Eastman Chemical.
Soon Mee Kim, SVP, technology (Atlanta). Soon Mee previously held senior leadership roles at Blanc & Otus Public Relations.
Mark Plungy, SVP, technology (Silicon Valley). Previous position was with The Hoffman Agency.
Sandra Sokoloff, SVP, head of national media relations (New York). Sokoloff has 18 years of communications experience in developing, managing and implementing media strategies and campaigns for brands such as Reynolds Wrap Aluminum Foil, Heinz and Coors.
Karen Weidenaar, SVP, consumer (Atlanta). Prior to joining Porter Novelli, Karen founded Impact Communications, Inc., a boutique agency specializing in business-to-business clients. She also served as vice president of executive visibility for Ogilvy.

What senior staff have departed the firm? Please state name and previous title.
Sheila Corriveau, president, Porter Novelli Canada, left the agency at the end of 2005 due to personal reasons.
Jim Bartell, managing director, San Diego, left the agency to start his own firm.
Pat Chui, managing director, Singapore, left the agency in 2005 for personal reasons.
John Tsantes, managing director, Advanced Technology Division (formerly Tsantes and Associates) left for personal reasons.
Warren Egnal, senior vice president, left to pursue another position.
Jerry Franz, EVP, Washington D.C. left for personal reasons.

Porter Novelli also made the following senior promotions:
Will Ludlam
, director, Asia Pacific; Will retains his post as managing director of the Seattle office
Trevor Campbell, managing director, Canada (Toronto)
Ed Dixon, managing director, Singapore
Anna Leonard, managing director, Silicon Valley
Steve Spurgeon, managing director, San Francisco
Jean Wyllie, managing director, United Kingdom (London)
Robyn Castellani, partner, social marketing sector leader (Atlanta)
Michael Kehs, partner, public affairs (Washington DC)
Sandra Kleinberg, partner, co-managing director, Mexico
John Orme, partner, Dow global account leader (Brussels)
Sandy Skees, partner, HP global account leader (Silicon Valley)

Have you made any acquisitions in the past year, or merged with another agency?
Porter Novelli acquired leading life sciences agency Atkins + Associates at the end of 2005. With this acquisition, Porter Novelli established a dedicated life sciences business unit, Porter Novelli Life Sciences. This new unit also took on the life sciences team of Porter Novelli subsidiary, FischerHealth, and is supported by Porter Novelli's full range of global talent and resources.

How many offices do you have globally?
Porter Novelli is represented in all major markets, comprised of both wholly-owned locations and network member locations.

North America
Atlanta; Austin; Boston; Chicago; Fort Lauderdale; Los Angeles -- 2 locations: Porter Novelli and FischerHealth; New York; Irvine; Sacramento; San Diego -- 2 locations: Porter Novelli and Porter Novelli Life Sciences; San Francisco; Seattle; Silicon Valley; Washington D.C.; Toronto; Montreal; Vancouver; Canada.

Central America/Caribbean
Network members only (see below).

South America
Additional network members (see below).

Belgium, England
(France, Netherlands, Portugal, Spain)*
(Greece – majority owned through Omnicom)
Additional network members (see below).

Middle East
(Israel – majority owned through Omnicom)
Additional network members (see below).

North, South Asia & Asia Pacific

In addition, Porter Novelli has an extensive group of more than 40 network members around the world. These agencies carry the Porter Novelli brand and work closely with our owned offices.

*To all intents and purposes, our offices in Mexico, France, The Netherlands, Portugal, Spain and Singapore function as owned offices. Internally, they are viewed in the same light as our US and other owned offices.

Is there a particular region, US and globally, that is growing right now? Is there a particular region, US and globally, that's shrinking?
The US and Mexico grew this past year. Belgium and The Netherlands also had a better 2005 than 2004, and the UK also saw improvement. Singapore experienced a recovery toward the end of the year. China and India are of intense interest to clients, with more requests for work in these rapidly growing markets, while Central and Eastern Europe are also growing in importance. Overall, client budgets and RFPs began increasing in scope and number in the latter half of 2005, which indicates, we believe, a continued strengthening of the public relations business.

How many practice areas do you have?
Rather than practice areas, Porter Novelli focuses on clients by organizing around three inter-related areas to serve stakeholder needs:

Disciplines: marketing, corporate and public affairs.
Industry groups: health care, technology, consumer, financial services, diversified industries (e.g. automotive and manufacturing), resources (e.g. energy, agriculture and chemicals) and government and advocacy institutions.
Specialties: strategic planning and research; media and influencer relations; multicultural; alliance building; advertising/corporate identity; interactive; sponsorships/sports marketing; event management; and crisis and issues

Media relations as a specialty continues to be strong--and we believe there is a new-found respect for what public relations can deliver on this front. Other specialties, such as advertising, interactive, multicultural and strategic planning are integral pieces of a more holistic approach to communications programs that help the agency meet client business objectives.

Which ones are new?
The reorganization according to disciplines, industries and specialties took place in 2005. While we have not added any new areas, we continue to develop our expertise within the disciplines, industries and specialties to ensure that we offer clients the best possible counsel on emerging communications strategies and channels. For example, our interactive team now includes blog and podcast offerings, and within our marketing discipline, buzz marketing and entertainment marketing are two growing areas.

Of those, which ones are part of the core strategy of the agency?
The offerings and organization described above are all core to the agency's strategy.

Which practice areas have been phased out in the past year?

What practice areas showed the most growth? Which practice areas showed the least growth?
All three of our discipline areas were strong, but we continued to see increased focus by many clients in tapping corporate and public affairs help as they confront a highly complex and fast-changing world. In some cases, this has meant redeployment of marketing dollars into issues managements programs, which has benefited the growth of our corporate and public affairs disciplines. As well, more and more clients are tapping our specialties--particularly advertising, creative, interactive and events--as they seek more fully integrated communications programs around a core strategy and concept.
In terms of industry sectors, we are seeing strong performance in technology, consumer packaged goods, health care and social marketing.
In addition to client expansion, the agency's health care sector was strengthened through the Atkins + Associates acquisition and the launch of Porter Novelli Life Sciences.

What is the distribution of accounts across practice areas?
The distribution of accounts across our disciplines is Marketing (60%), Corporate (20%) and Public Affairs (20%).

Did any dormant clients start to spend with you again?
No, not in the US

What proportion of your clients are on a retainer?
Due to Omnicom policy, we are unable to share this information. However, we can say that very few of our clients are on retainer.

Has this changed over the past year?

What was your 2005 US revenue?
Due to Omnicom policy, we are unable to share this information.

What was the % change over 2004 US revenue?
Due to Omnicom policy, we are unable to share this information.

What was your 2005 global revenue?
Due to Omnicom policy, we are unable to share this information.

What was the % change over 2004 global revenue?
Due to Omnicom policy, we are unable to share this information.

Did you experience top-line or bottom-line growth in the past year?
We experienced modest topline growth in the United States.

How did your performance, in terms of revenue and growth, meet expectations you had for the year?
Met expectations.

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