Edelman had a great year for new business and client work. Better yet, it got out in front of the issues that dominated the PR industry, to the benefit of both its clients and its own marketing goals.
Richard Edelman recently posted an entry on his blog titled, "I Am Even More Certain That Now Is Our Time." It's not uncommon for the Edelman CEO to write or speak on the theme of how PR can and should dominate the marketing mix, about its power to reach people as no 30-second spot ever will.
But to watch Edelman's trajectory during the past year, one might assume that the CEO was writing about his own firm.
For the past few years, through its strengths in consumer and healthcare in particular, it has been able to rebound smartly from the downturn. But in 2005, Edelman simply moved to a different league, if not in actual client work, then in profile and reputation, and in sheer competitive will power.
It is impossible not to be struck by how many different aspects of the cultural, political, and commercial landscape Edelman has popped up in during the past year. From Wal-Mart to Dove's Real Beauty, from Swiss Re to Morgan Stanley, to the Xbox 360, Edelman has played a role in each of these newsmaking phenomena. New accounts include Royal Dutch Shell, PhRMA, the United Way of America, and the American Heart Association's Go Red for Women campaign.
Though the business side of the story is the primary reason for the buzz, it has been complemented by the firm's ability to harness its success for its own PR benefit. Edelman has a unique marketing drive that it directs towards its own organization.
The firm has, at times, been part of the news, as it was in the recent front-page story in The New York Times on Wal-Mart's strategies for combating its critics, including its Bentonville, AR "war room." The piece looked closely at the work being done by such Edelman stars as vice chairman Leslie Dach on behalf of the retailer.
To be sure, this was not the kind of story that every agency would embrace. But whatever one thinks of the PR firm becoming part of the story, the opportunity to see the key role being played by an agency in one of the most important business stories in the US is significant.
Edelman has also employed many of the contemporary tools of the new-media trade to deliver both case studies and ideas. Streaming video on its website offers insights from its leadership on various PR case studies. Podcasts of the firm's leadership are deployed as an employee communications tool.
A survey of bloggers in partnership with Technorati.com, and a study on staff bloggers with Intelliseek, have further solidified Edelman's status in new media expertise. Indeed, of all the large, multinational firms, the agency was the quickest to publicly seize on the implications and challenges of the media environment.
Edelman's blog, too, has been an unexpected boon. There are a number of CEO bloggers in the PR world, including a few mentioned in these pages. Richard Edelman does not post every day, and the topics have the typical varying levels of relevancy that one expects to find in many blogs that the author does not write for a living.
But as the industry turned inside out during the past year, in the wake of issues like the DoE's contract with Armstrong Williams, the blog has become a site where Richard Edelman's opinions on whatever may be currently roiling the industry will reliably be found. Pushing out these perspectives has had a PR benefit of its own, and Edelman himself recently appeared on the CBS Evening News to talk about the issue of the Pentagon paying news outlets to run pre-written news stories in Iraq.
There are many in the industry who would eschew that kind of profile, and Edelman has been criticized at times for views expressed about issues that impact competitors.
But even though one might not agree with the tactics, through its efforts, Edelman is changing the marketing landscape for other firms, particularly those of a similar size.
The firm has been nimble enough to take ownership of issues as they are emerging, and translate their implications into strategies for clients.
Edelman has also continued to invest in deep thought leadership plays, such as the annual Trust Barometer. Richard Edelman each year addresses the World Economic Forum at Davos, another platform for communicating credibility, and an understanding of the broader economic, political, and commercial landscape.
As we begin 2006, it remains to be seen whether Edelman can sustain this level of frenetic external and internal activity. Other questions linger, too, about its consistency in attracting and retaining talent. Too many senior hires seem not to work out. This has been particularly noticeable in the Bay Area, where leadership changes have been endemic. Pam Pollace, previously of Intel, is the latest global head of the technology practice, a role that had been vacant for some time.
In direct counterpoint to that is the tenure of key people, some of many years' standing, such as Pam Talbot, president and US CEO, Nancy Turett, president and global director, Gail Becker, president, Western region, Matthew Harrington, president, Eastern region, Mitch Markson, president of consumer brands and global creative director, Michael Deaver, vice chairman, Alan VanderMolen, president, Asia Pacific, and David Brain, president and CEO, Europe. Edelman's international presence was bolstered with acquisitions in the UK and India, but business outside the US is still an area of development.
Last year, Edelman reported revenues of $152.7 million, a 10% increase over the previous year, with 1,010 employees. All signs point to double-digit growth again this year. As the world's largest independent firm, Edelman cannot rely on referrals from advertising holding company partners, in the way that its primary competitors can. Each year the question remains: Will this independent stalwart finally sell? Odds are, this is not the year, as growth, and not margins, is its priority.
The personality and culture of Edelman have been as much a part of its story this year as its successes. Consistently aggressive, occasionally polarizing, and always fascinating, Edelman promises to keep delivering on its reputation this year.
Global external relations officer
Procter & Gamble
Jim Stengel, P&G's high-profile CMO, seems to be everywhere these days, particularly on the cover of marketing publications whose contents describe at length the innovations and successes that have led it to be named Marketer of the Year by Advertising Age, and heralded as an industry leader.
P&G's turnaround story is a compelling one, and for the PR industry one of the most gratifying innovations has been the corporation's development of a measurement tool, called PREvaluate, which quantifies the impact of PR on business performance. The company then focused its attention, for 18 months, on developing the program, and tested it on six brands where the marketing mix modeling approach could be applied.
The results confirmed what many in public relations had suspected. Out of the six brands tested, four of them demonstrated that PR had the biggest ROI of any other marketing discipline. It's a great measurement story, inasmuch as it is still rare to find companies willing to invest that much time and resource to prove the impact of a comparatively inexpensive marketing discipline.
It stands to reason that Charlotte Otto, SVP and global external relations officer, will play an ever more critical role going forward, if that's possible. Her will to prove the value of PR is a big reason why this research was done in the first place.
Otto has long been a leader at the company. A P&G lifer who joined in 1976, Otto started her career on the advertising side, where she spent 13 years managing such brands as Sure, Pert, and Bounty before moving on to the public affairs department.
A central part of Otto's role has been to elevate the PR function to a policy level within the company, and Otto herself rose to become the company's first female corporate officer. Otto has observed the growth of PR within corporations long before this recent research validated its contribution more tangibly.
"We were order takers 13 years ago," Otto told PRWeek in 2003. "We were lucky if we got in to write the press releases in a lot of companies."
When we interviewed her for our 5th anniversary issue in 2003, Otto was just embarking on the measurement challenge. "One of the deep frustrations I have is, for some who are disbelievers, we continually have this question about measurement," she said at the time.
Otto tapped P&G's innovation fund to develop a measurement project that she hoped would put an end to the debate over the contribution of PR to moving brands. "I am just so sick of this discussion," she said.
The results of P&G's research demonstrates just one aspect of the work that Otto and the entire marketing team has been doing to rethink the way that its brands interact with consumers. But in an industry where so much is deemed intangible, the leadership that Otto takes in applying rigor and metrics to the art of PR is an example for everyone, and a sign of truly exciting momentum for the company.
Last year's picks
PRWeek rates itself on last year's Who to Watch selections
WPP was chosen for its aggressive pursuit of business through holding company consolidations, led with swagger by CEO Martin Sorrell. Notwithstanding its success in scoring business from such companies as Hitachi Data Systems, the company made bigger news with its acquisition of Grey Global and another change at the top of Burson-Marsteller. But the holding company business story, for all the players, is still unfolding - in no small part because of WPP's tactics, which have dominated the discussion.
Andy Polansky, president, Weber Shandwick
Last year solidified the agency's profile in the market as it continued to win and grow business and recruit top talent, without losing much of either to rivals. The year-end bonus was a chunk of the Army account from advertising sister McCann-Erickson. While Polansky continues to embody the nice-guy role to perfection, the agency's no-nonsense management, client focus, and entrepreneurial momentum continue to be its hallmarks.