Rick Murray, President, Edelman Chicago
Was named to his current post in 2010 after five years leading the agency's global digital business
I'm no seer, but given the growth we've seen in the past five years, three of which had us deep in the worst economy in 80 years, I think $1 billion is definitely within reach. Here are four ways it could happen.
- Consolidation. PR might skew local, but clients are increasingly seeking global reach and value pricing that's only viable with matching economies of scale. In this scenario, one or more of the top five firms could get there by merging with or acquiring smaller firms that match up with their portfolio.
- Credible metrics. The fact we can't yet prove PR works as well or better than advertising is the principal thing standing between PR and a much bigger share of client budgets. On average, PR is seeing about five cents of every client's dollar. If we resolve the measurement issue, all bets are off.
- PR wins social media. PR is ideally positioned to help clients succeed in social media. We're definitely headed toward a market where real-time engagement with stakeholders is the norm. The spoils will go to any firm that can scale its social media, community management, and content generation across every practice and market.
- BRIIC-ME acceptance. The vast majority of global PR firms' fees are still derived from Anglo-American markets. Most clients in the rest of the world continue to view PR through a lens we abandoned a decade ago, but that perspective is changing. At Edelman, we're seeing high double-digit growth in what we call the BRIIC-ME markets (BRIC + Indonesia and the Middle East). I imagine others are seeing similar success. For all of us, future growth will stem from broader bases.
Truth be told, I have no idea whether anyone, Edelman included, will get to $1 billion in five years. In the end, size might offer bragging rights, but quality in all you do is what drives relationships, reputation, and revenues. Our founder Dan Edelman says it best: "It's nice to be the biggest, but it's important to be the best."
Tim Dyson, Global CEO, Next Fifteen
One of the early pioneers of tech PR, his group includes Text 100, Bite, M Booth, and The OutCast Agency.
The challenge is not necessarily getting to a billion dollars; it is more about building a communications agency with the right people at its heart and driving an entrepreneurial culture that will maximize the opportunity it's afforded. PR firms have repeatedly gotten to the $400 million to $500 million level, but have never managed to get above that. They've always hit some ceiling.
In the "traditional" PR world, the idea of growing 15% per annum uninterrupted over five years is unrealistic. The most practical way it can be done is via acquisition and not purely organic growth, as this will require a huge cultural, staff change and a retention culture - nigh on impossible. In short, traditional markets will not let you grow at that speed.
Digital is a great way of growing the business. It changes the rules, opens up PR to a bigger and broader market, and provides growth opportunities. However, PR agencies must not become complacent; PR alone has no divine right to win. Anyone who thinks the advertising industry is just going to stand back and watch PR agencies take their business is being naive. As clients of all marketing services disciplines become more digitally savvy and - rightly - demand measurable business outcomes, we will without doubt see a real shakeout of agencies that deliver truly integrated campaigns and those that don't.
So while I foresee great opportunities for agencies in the coming years, particularly around digital, and it is entirely possible for a firm to get to the billion-dollar mark, growing at that speed would clearly be a huge task.
Moreover, aiming for an arbitrary target could cloud the judgment of any business leader; it only takes one significant mistake to mess things up. If you want to grow at that speed, beware of what you wish for - you expose yourself to great risk.
While the PR industry might have never before been presented with the opportunity that digital provides it now, the fact is the fundamentals of running a great business remain the same as ever. Let's watch this space.
While reaching the $1 billion mark within five years is possible, the vast competition for digital business that will most likely facilitate that - and the odds of increasing revenue that much in the given time - makes it unlikely.